PURPOSE
Provides lower-interest financing for certain types of projects.
AUTHORIZATION
Internal Revenue Code of 1986, as amended, Codified at 26 U.S.C. §§ 141 to 150
Sections 108.500 to 108.532, RSMo
ELIGIBLE AREAS
Statewide.
ELIGIBLE APPLICANTS
Certain state agencies, cities, counties and industrial development authorities.
ELIGIBILITY CRITERIA
Details about eligible bonds are on the federal tax code. It is very important that determinations of eligibility be made only after consulting the applicable federal law.
For general informational purposes, small manufacturing facilities are included in the types of projects for which tax-exempt bond cap may be allocated.
PROGRAM BENEFITS/ELIGIBLE USES
The federal tax code authorizes each state an allocation of tax-exempt bond cap. The amount is based upon the state's population in the preceding year.
In Missouri, the Department of Economic Development (DED) has the authority to allocate the tax-exempt cap to projects.
Because there is no tax on interest earned by the holders of tax-exempt bonds, the interest rate is typically lower than conventional financing, including taxable bonds.
FUNDING LIMITS
Missouri's cap for 2011 is $568,948,065, and $50,000,000 of this year's cap has been reserved specifically for disaster recovery in Joplin.
APPLICATION/APPROVAL PROCEDURE
• Once the issuing entity has passed an inducement resolution, an application is submitted to DED. Applications are accepted year-round. Applications should be clearly marked as applying for disaster recovery allocation.
• The standard application fee will be waived for disaster recovery applicants during 2011.
• For Industrial Revenue Bond (IRB) projects, a copy of the local Industrial Development Authority (IDA) application or relevant job, wage, and investment data must be submitted with the application.
• A "hold letter" is typically issued to every applicant pending a decision by the department.
• A decision is made on a case-by-case basis
• An allocation letter is issued if appropriate.
• The allocation is good for 60 days from the date of the letter. A 30-day extension can be granted.
• Upon issuance of the bonds, the issuer must notify DED both by telephone (no later than the next business day) and submit a report of issuance by overnight courier or certified mail (no later than five calendar days from issuance).
• The issuance fee will be waived for disaster recovery applicants during 2011.
REPORTING REQUIREMENTS
Annual activity reports must be filed no later than January 31st of the year following issuance.
MISSOURI DEVELOPMENT FINANCE BOARD
MDFB is one statewide issuer of various types of tax-exempt bonds, including some for small manufacturing facility projects. Additional information about the programs and services provided by MDFB can be found at www.mdfb.org.
LOCAL ENTITIES
Many local entities, such as industrial developoment authorities, can issue tax-exempt bonds. The contact information for the Industrial Development Authority of the City of Joplin is:
Rob O'Brian CEcD
President
Joplin Area Chamber of Commerce
320 E. 4th Street
Joplin, MO 64801
Phone: (417) 624-4150
CONTACT
Missouri Department of Economic Development
Division of Business and Community Services
Business and Community Finance Team
301 West High Street, Room 770
P.O. Box 118
Jefferson City, MO 65102
Phone: (573) 751-4539
Fax: (573) 522-4322
E-mail: dedfin@ded.mo.gov