Martin County Industrial Development Authority
About the MCIDA
The Martin County Industrial Development Authority was formed by the Martin County Board of County Commissioners in 1981 in accordance with state statute (Chapter 159, Part III). As a means to support economic development, the MCIDA provides access to tax exempt and taxable bond financing as an inducement to local, qualified companies.
The Board of County Commissioners appoints five members to serve on the MCIDA Board of Directors. Directors serve a four-year term and are eligible for reappointment. The executive director of the Business Development Board of Martin County (BDBMC) serves as secretary, and the BDBMC operates as staff to the IDA. Programs implemented are consistent with the Authority's legal status and compatible with the economic development goals established by the Board of County Commissioners and the Business Development Board of Martin County.
Martin County IDA works with new and existing companies to provide necessary assistance to bring about successful expansion or location for business in Martin County. This is accomplished in partnership with the Business Development Board of Martin County, the county's official economic development organization and Enterprise Florida partner. The role of the MCIDA is primarily executed through the issuance of tax-exempt Industrial Development Revenue Bonds.
Industrial Development Revenue Bonds (IDBs) are securities issued by a local governmental agency, such as the Martin County Industrial Development Authority, for the purpose of financing capital projects. The Martin County Industrial Development Authority recognizes the importance of IDBs, also known as "private activity bonds," as a viable method of financing industrial relocation and expansion.
Industrial Development Revenue Bonds finance business and industrial expansions for firms with strong credit. IDBs can provide low-interest loans for large projects by permitting the borrower to take advantage of long-term financing with lower than prime interest rates. Additionally, for certain types of manufacturing facilities, interest rates can be lowered further due to the tax-exempt status of the bond issue. Private parties purchase the bonds, in effect making the loan to the borrowing business.
Issuance of IDBs provide below market interest rate financing for fixed asset projects. The debt service on the bonds is paid solely from the revenues or payments received from the company, and there is no undertaking on the part of the local agency, county or any other governmental unit to make such payments other than from the lease or installment payments received.
The Martin County IDA requires the proposed projects be capable of producing tangible economic benefits in the form of new employment, the preservation of existing employment, new capital investment, or combination thereof. No project will be financed for any individual or company that is not financially responsible and fully capable and willing to fulfill its financial obligations. Companies applying for IDB Funding must obtain a qualified Bond Counsel.
Industrial Development Revenue Bonds (IDBs) finance business and industrial expansions for firms with strong credit. IDBs can provide low-interest loans for large projects by permitting the borrower to take advantage of long-term financing with lower than prime interest rates. Additionally, for certain types of manufacturing facilities, interest rates can be lowered further due to the tax-exempt status of the bond issue. Private parties purchase the bonds, in effect making the loan to the borrowing business.
IDBs may finance up to 100 percent of project costs, with loans up to $10 million available if the financing is tax-exempt. In the case of taxable bonds, no cap on the amount exists. Since significant legal costs are necessary with an IDB issue, projects should be at least $1 million in value to be cost effective.
Interest on IDBs may be at a fixed or variable rate. Variable rates typically range from 85-100 percent of prime, depending on the strength of the firm's credit. Fixed interest rates average approximately one percent below prime. Maturity varies from five to 30 years, matching the life of assets.
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