The SLC IDA provides a variety of financing and incentive programs to help jumpstart your business in St. Lawrence County.
Tax Abatement Programs
The general policy of the St. Lawrence County Industrial Development Agency (“Agency”) is to grant applicants real property tax abatements and exemptions from sales, use and mortgage recording taxes as described below. The Agency may grant enhanced benefits on a case by case basis for a project expected to have a significant economic impact on St. Lawrence County, as determined by the Agency’s members. The Agency will grant enhanced benefits only after approval is given for said enhanced benefits by the local taxing jurisdictions involved.
A. Real Property Taxes
The Agency maintains a policy for the provision of real property tax abatements for qualified projects. The abatement provided applies to value added by construction or renovation; provided, however, in no event will the involvement by the Agency result in revenue to the affected taxing jurisdictions in any tax year less than the revenues received in the tax year preceding involvement by the Agency. Unless otherwise agreed to by the local taxing jurisdictions, the period of exemption will not exceed ten (10) years. The Agency’s policy applies to both industrial (including, but not limited to manufacturing, re-manufacturing, assembly, processing, product research and development, warehousing and distribution) and non-manufacturing projects (including, but not limited to qualified retail, office, hotel, nursing home, extended care facilities and health care facilities). The abatement for industrial projects in the first five (5) years after project completion, i.e. issuance of a Certificate of Occupancy will be 100%; in years six (6) through ten (10) the abatement will be 50% of what the taxes would otherwise be on the improvements. For non-industrial projects the abatement will be whatever the developer and local taxing jurisdictions agree upon.
Any deviation from the standard policy will be made only under the following conditions: after approval of deviation/enhancement by the local taxing jurisdictions as described above; with the specific approval of the Agency’s members based on the factors listed in paragraph E; and those factors described in the New York State General Municipal Law Section 874(4)(a).
B. Payment-In-Lieu-Of-Taxes
Each project receiving an abatement will be subject to a Payment-In-Lieu-Of-Tax Agreement (“PILOT Agreement) in a form acceptable to the Agency. When granting enhanced benefits the Agency will consider project factors, similar to those described in paragraph E herein. A copy of the PILOT Agreement will be forwarded to each of the affected tax jurisdictions within fifteen (15) days of execution. Unless otherwise agreed by all the affected taxing jurisdictions, such payments shall be allocated among the affected tax jurisdictions in proportion to the amount of real property tax and other taxes which would have been received by each affected taxing jurisdiction had the project not been tax exempt due to the status of the Agency involved in the project.
C. Sales and Use Tax Exemptions.
- Purchases of construction materials and equipment rentals and purchases of project related equipment, furnishings and services are made as agent for the Agency, and are therefore afforded full exemption from local and New York State Sales and Use Taxes until the project is completed (i.e. certificate of occupancy) or until the date certain established by the Agency on a project-by-project basis. Operating and maintenance expenses of projects are not incurred as agent of the Agency, and no sales tax exemption is provided thereof.
- All project applicants must agree in writing to file with the New York State Department of Taxation, in form and at times required, an annual statement of the value of all sales and use taxes exemption claimed in connection with the facility in full compliance with Section 874(8) of the General Municipal Law, and any other statutory or regulatory requirements.
D. Mortgage Recording Tax Exemptions.
The Agency’s policy is to permit mortgage recording tax exemptions on all project related financing to the full extent permitted by New York State Law, whether or not the Agency has issued its bonds to finance the Project.
E. Deviations.
In addition to or in lieu of the foregoing the Agency may determine, on a case-by-case basis, to deviate from the guidelines described above or provide enhanced benefits for a project expected to have significant impact in the locality where the project will be located. Any deviation from the guidelines set forth above requires an affirmative vote by each local taxing jurisdictions on the proposed deviation. The Agency may consider any or all of the following factors in making such determination, no single one of which is determinative:
- The nature of the proposed project (e.g. manufacturing, commercial, civic, etc.).
- The nature of the property before the project begins (e.g. vacant land, vacant building, etc.)
- The economic condition of the area at the time of the application and the economic multiplying effect the project will have on the area.
- The extent to which the project will create or retain permanent, private sector jobs, the number of jobs to be created/retained and/or the salary ranges of such jobs.
- The estimated value of tax exemptions to be provided.
- The economic impact of the project and the proposed tax exemptions on affected taxing jurisdictions.
- The impact of the proposed project on existing and proposed businesses and economic development projects in the vicinity.
- The amount private sector investment generated or likely to be generated by the proposed project.
- The likelihood of accomplishing the proposed project in a timely fashion.
- The effect of the proposed project upon the environment and surrounding property.
- The extent to which the proposed project will require the provision of additional services including, but not limited to, educational, transportation, emergency medical or police and fire services.
- The extent to which the proposed project will provide additional sources of revenue for municipalities and school districts in which the project is located.
- The extent to which the proposed project will provide a benefit (economic or otherwise) not otherwise available within the municipality in which the project is located.
F. Intentionally Omitted.
G. Effective Date.
This Uniform Tax Exemption Policy shall apply to all projects for which the Agency has adopted or adopts an Inducement Resolution after March 19, 1999 and all refinancings of any project induced or closed after said date.
H. Amendments.
The Agency, by resolution of its members, and upon notice to all affected tax jurisdictions as may be required by law, may amend or modify the foregoing policy as it may, from time to time, in its sole discretion determine.
Bond Financing
The St. Lawrence County Industrial Development Agency is a public benefit corporation empowered to finance the acquisition, construction, or reconstruction of manufacturing, warehousing, research, commercial, industrial, and pollution control projects. One method of raising funds to accomplish these purposes is through the issuance of negotiable, tax-exempt or taxable bonds and notes.
ELIGIBILITY
Substantial companies with a strong financial position and a good operational “track record” which will create jobs through added capital investment in St. Lawrence County may apply for industrial revenue bond financing. The Internal Revenue Service Code imposes general limitations on the amount of tax-exempt financing which an industrial development agency may provide for any one project. Limitations and exceptions thereto are cited in the Internal Revenue Code, Tax Equity and Fiscal Responsibility Act of 1982 and the Deficit Reduction Act of 1984.
APPLICATION PROCEDURES
Any company considering the use of industrial revenue bond financing should first meet with representatives of the Agency to discuss the firm’s financial needs and eligibility for industrial revenue bond financing.
If a company is eligible for this form of financing, a formal application must be submitted accompanied by a $2,000 filing fee. (If project financing is completed with the Agency, the filing fee will be forwarded to the St. Lawrence County Clerk’s office in the form of an in-lieu-of-filing fee payment.) The company must provide evidence, in the form of a letter of intent from a reputable financing institution, that a market for the bonds exists.
The company must locate an underwriter, a bank, or a group of banks willing to purchase the Agency’s bonds to be issued on behalf of the company. The company negotiates the terms and conditions of the loan with the purchaser or purchasers; this includes: maturity, interest rate, security, prepayment conditions and restrictions, if any.
Upon receipt of a complete bond application, the Agency will appoint a committee to comply with the State Environmental Quality Review procedure.
Effective January 24, 1985, the St. Lawrence County Industrial Development Agency adopted the following Additional Procedures Affecting Tax Exempt Bond Financing:
Beginning January of each year, the Agency will evaluate applications from firms and induce projects on a case-by-case basis. From January 1 of each year through June 30, the Agency will only act on bond resolutions for manufacturing or related facilities, e.g., warehousing, which meet the IDA criteria of creating new full-time jobs or preserving existing ones. Eligible projects, other than manufacturing, will be induced by the Agency based on the Agency’s evaluation of the number of jobs created, value of wages and the importance of the project to community economic development.
After July 1 of each year, the Agency will consider bond resolutions for other than manufacturing projects permitted under the governing legislation. The resolutions will be considered in the order that the applications were induced by the Agency.
Inducement resolutions authorized by the Agency will be valid for 60 days from date of authorization. During the 60-day period, the applicant will secure a satisfactory financial commitment letter sufficient to cover purchase of bonds. In case of inducement for non-manufacturing projects between January 1 and June 30, the resolution will be valid through August 15 of the year in which the resolution was induced. Applicants will have until that date to evidence financial commitment.
Upon receipt of such satisfactory commitment, the inducement resolution will be extended an additional 120 days. Closing will take place on or before the 180th day after adoption of the inducement resolution.
The St. Lawrence County Industrial Development Agency may, at its sole option, extend inducement resolutions for specified periods of time if the Agency believes that such extensions are in the interest of the County’s economic welfare.
FOR FURTHER INFORMATION
To obtain further details about industrial revenue bond financing in St. Lawrence County, you are encouraged to contact the Agency’s Chief Executive Officer at (315) 379-9806.
We will schedule an exploratory meeting with you to identify your firm’s specific needs and to determine how those needs might be met through the St. Lawrence County Industrial Development Agency.
BENEFITS OF INDUSTRIAL REVENUE BOND FINANCING
- Financing of up to 100% of the cost of land, construction, equipment, planning, and financing fees.
- A possible sales tax exemption on building materials and production-related equipment purchased from bond proceeds.
- Exemption from real estate taxes. Company and Agency will negotiate a payment-in-lieu-of-taxes agreement.
- Building, land, and equipment remain on company financial statements as assets while the lease is shown as a long-term debt on the liability side of the balance sheet.
ADDITIONAL BENEFITS OF TAX EXEMPT BONDS
- Interest income is tax-exempt to the bond holder.
- Interest rates are lower than conventional bond rates.
FINANCING COSTS
- Bond Counsel Fee – Bond Counsel is a legal firm, which specializes in tax-exempt and taxable bond issues. Usually a bank or underwriter will not participate in the purchase of a bond issue unless it has a legal opinion from a recognized Bond Counsel. The Bond Counsel reviews the company’s project to assure that it qualifies under State and Federal Laws and Codes. It also prepares all documentation required for the issue. Fees vary and are dependent upon the complexity of the issue and the amount of time involved.
- Agency Fee – The St. Lawrence County Industrial Development Agency is a self-supporting agency. In order to pay its expenses, the Agency charges clients a fee equal to 1% of the face value of the tax-exempt bonds issued. The Agency fee for a taxable bond is one-half of 1%. The Agency also charges the client for any direct out-of-pocket costs such as legal advertising.
- Other Legal – An applicant company will retain an Attorney to assure that its interests are protected. The bank or buyer of the bond issue will normally have outside Counsel whose fees are usually passed on to the company. In addition, the Agency is represented by its own Counsel whose fee is charged to the Company.
All documents recorded at the St. Lawrence County Clerk’s Office carry a charge of $10.00 per document and $3.00 per page.
Because of the significant fees involved, industrial revenue bond financing for projects under $1,500,000 is usually not practical. It should be noted that all of the aforementioned fees can be included in the principal amount of the bond financing.
A recognized Bond Counsel must render a positive opinion to the Agency regarding the appropriateness of a company’s proposal under existing New York State Law and the Internal Revenue Service Code.
At this point, the Agency will consider an Inducement Resolution and if said resolution is approved, the Agency will appoint the company to act as its agent and the company may proceed with the project.
Bond Counsel prepares a “first draft” of the bond documents for the review of all parties prior to the preparation of the final bond documents.
Once the Agency approves the application and the bond purchases is committed to the loan, a closing can usually be accomplished within 90 days or shortly thereafter.
BOND ISSUANCE
The Agency issues revenue bonds in its own name. These bonds are secured by a mortgage on the property and/or a lien on the machinery and equipment involved and by a subsequent lease to the company.
These bonds are issued upon the full faith and credit of the company and are not an obligation of the Agency, the municipality nor of the state. These bonds are amortized by the revenue from the project, i.e., lease payments.
The ability to sell the bonds for each project will depend on three major factors:
- the reputation and financial position of the company;
- the economic merits of the proposed project;
- and prevailing bond market conditions.
Upon completion of the project, the facilities, improvements or equipment are leased to the company for a term equal to the term of the Agency’s bond issue. The annual lease payments equal the annual principal and interest due on the Agency’s bonds.
The company pays all operation and maintenance expenses associated with servicing the bonds or the project. The security for the Agency’s bonds is a first mortgage on the project and an assignment of the Agency’s rights under lease with the company. At the end of the lease term, the company is obligated to purchase the project for $1.
Loan Funds
There are a number of loan funds available to businesses in St. Lawrence County. Funding is offered for a variety of company sizes and types, from microenterprise firms and startup to large manufacturing and industrial companies.
The following loan funds are administered through the St. Lawrence County Industrial Development Agency:
- SLC IDA Local Development Corporation Business Venture Fund
- St. Lawrence County Local Development Corporation
- Microenterprise Loan Fund
- Greater Massena Economic Development Loan Fund
- Local Loan Funds
- Regional Loan Funds
SLC IDA Local Development Corporation Business Venture Fund
Summary Sheet:
Area of Eligibility:
Businesses located in St. Lawrence County.
Eligible Businesses:
Manufacturing, industrial, commercial and warehousing operations.(No loans will be made for lodging, restaurants, alcohol sales, legal, medical or nursing services, retail firms, casinos and other gambling establishments).
Loan Amount:
Lesser of 30% of the projects cost or $400,000.
Use of Funds:
Real estate acquisition, building construction and rehabilitation, or machinery and equipment acquisition and rehabilitation, or working capital and inventory with adequate security.
Rate and Terms:
Rate fixed at one-half of the prime rate plus one percent. Terms are normally five to ten years.
Equity:
Minimum equity investment of 10%.
Bank Participation:
The IDA Local Development Corporation will approve applications only when the required commitments from the primary lender and other necessary financing parties have been secured.
Application Considerations:
Job creation and/or job retention is considered. The applicant’s hiring plan must demonstrate creation or retention of at least one job for every $15,000 of financing. The borrower is required to fill 51% of new jobs with low-moderate income persons.
Fees:
$100 non-refundable application fee. Borrower is also responsible for all closing costs, if applicable.
Review Process:
Four to six weeks, on average.
Microenterprise Program
The St. Lawrence County Microenterprise Loan Program provides financing assistance to low-moderate income persons in St. Lawrence County to start or expand their microenterprise businesses (i.e. businesses with five or fewer employees, one of whom is the owner).
Greater Massena Economic Development Fund
Greater Massena Economic Development Fund
The Greater Massena Economic Development Fund was created by the New York Power Authority to induce business enterprises to establish, maintain or expand plants, facilities or operations in the Town of Massena and St. Lawrence County.
The GMEDF will make low-interest loans up to the lesser of 30% of the project’s cost, or $200,000. The applicant must provide at least a 10% equity contribution to the project. In-kind labor, materials and/or services may satisfy this contribution. The loan fund is administered by the St. Lawrence County IDA Local Development Corporation.
The 5-member GMEDF Board includes a representative from each of the following: St. Lawrence County Industrial Development Agency, New York Power Authority, New York State Empire State Development Corporation, New York Job Development Authority and Town of Massena.
Area of Eligibility:
Businesses located in St. Lawrence County.
Eligible Businesses:
Industrial, manufacturing, research and development, high technology, agricultural, or non-retail service businesses. (No loans will be made for lodging, restaurants, alcohol sales, legal, medical or nursing services, retail firms, casinos and other gambling establishments).
Loan Amount:
Lesser of 30% of the projects cost or $200,000.
Use of Funds:
Machinery or equipment.
Rates & Terms:
Interest rate is typically fixed at one-half of the prime rate plus one percent. Terms will generally be ten years for real estate and five to seven years for machinery and equipment.
Equity Participation:
Minimum equity investment of 10%.
Bank Participation:
Normally, a private lender must provide at least 30% of the project financing.
Application Considerations:
The purpose of this loan fund is to offer low-cost financing as an inducement to established firms to expand their operations. As such, it is limited to healthy firms with collateral sufficient to secure the loan. The applicant’s hiring plan must demonstrate they will create or retain at least on job for every $15,000 of funding.
Fees:
$100 non-refundable application fee and closing costs, if applicable.
Review Process:
The entire process should take from 4 to 8 weeks provided all necessary documentation, including other financing commitments, are in place.
Local Loan Funds
In addition to the available countywide and regional lending programs, the following local municipalities have their own individual loan funds:
Canton
St. Lawrence Initiative
Canton Office of Economic Development
(315) 386-2871, x5
www.cantonecondev.com
Gouverneur
Gouverneur Area Development Corporation Loan Fund
1227 USH 11
Gouverneur, NY 13642
(315) 287-1940
www.gouverneurny.com
Ogdensburg
Ogdensburg Growth Fund Development Corporation – Low-interest loans for acquisition, renovation, equipment and working capital. A special program for construction assistance may allow for short-term borrowing at 0% when permanent financing has been arranged.
Ogdensburg Empire Zone
330 Ford Street, City Hall, Room 10
(315) 393-7150
www.ogdensburg.org
Town of Oswegatchie
Oswegatchie Local Development Corporation Loan Fund
Town of Oswegatchie
51 State Street
Heuvelton, NY 13654
(315) 344-1246
Potsdam
The Potsdam Planning and Development Office can originate loans to businesses locating within its Empire Zone in order to help with job creation.
The Micro-Enterprise Loan Fund, administered by the Potsdam Planning and Development Office, offers loans of up to $25,000 to businesses with five or fewer employees, including the owner(s). Funds can be used for working capital, leasehold improvements, machinery and equipment, and real estate development. Additional loan funds of up to $25,000 are also available for larger businesses. All local loans are based on underwriting and programmatic criteria and the availability of funds.
Potsdam Office of Planning & Development
Civic Center, Park Street, Potsdam, NY 13676
Phone 315.265.1670
www.potsdam.ny.us/econ.html
Regional Loan Funds
The North Country Alliance is a consortium of economic development organizations working in New York’s six-county North Country. North Country Alliance members offer a full range of financial resources to support business expansion. In addition to administering the North Country Regional Revolving Loan Trust Fund, the NCA functions as a single point of contact for local, state and federal financing programs available to firms in the North Country.
The Development Authority provides services to enhance the economic development of Northern New York. DANC administers several business loan programs to encourage job creation and retention in Northern New York. These include programs include offerings from the U.S. Small Business Administration (SBA), the New York Business Development Corporation (NYBDC) and the DANC Community Development Loan Fund (CDLF).
The Adirondack Economic Development Corporation (AEDC) is a private not-for-profit 501-c-3 economic development corporation that was formed in 1976 as a cooperative effort of community leaders in towns of the northern Adirondacks, a mountainous rural region of upstate New York. AEDC was created to reduce unemployment and expand employment opportunities for the region’s residents through activities to strengthen and diversify the regional economy. AEDC’s programs combine entrepreneurial training and small business development, community development services, and financing capacity to create multi-level economic opportunities appropriate for an environmentally protected region.
Empire State Development Programs
Comprehensive Economic Development Strategy
Empire State Development provides a variety of assistance aimed at helping businesses – whether its an international company looking to make a move or a small business owner wanting to access capital.
ESD offers loans, grants and tax credits, as well as other financing and technical assistance, to support businesses and encourage their growth within New York State.
New York State’s Excelsior Jobs Program is a targeted program, focusing on the growth and expansion of the high-tech and clean energy jobs of tomorrow, while also supporting the manufacturing sector that remains the backbone of our economy. Applications should be completed in consultation with the appropriate regional office representative of Empire State Development.
As part of Governor Cuomo’s transformative plan to improve the State’s economic development model, a NYS Consolidated Funding Application (CFA) has been created that will streamline and expedite the grant application process. The CFA process marks a fundamental shift in the way State resources are allocated, ensuring less bureaucracy and greater efficiency to fulfill local economic development needs.
Visit ESD’s website (click here) for more information on any of the following programs:
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Here for You
Of all the available incentives to help jumpstart your business in St. Lawrence County, the one you will appreciate most is us. Our team of business advisors help you every step of the way, including finding the financing and incentives best suited to your project.
We can help lower your project costs and unlock capital through one of our aggressive tax reduction programs, identify the right loan fund to meet your project needs, from microenterprise firms and startups to large manufacturing and industrial companies. We can partner you with low-cost power incentives and green energy solutions for all levels of industry from non-profit to corporation. As a public benefit corporation The St. Lawrence County IDA is empowered to finance the acquisition, construction, or reconstruction of manufacturing, warehousing, research, commercial, industrial, and pollution control projects. Learn more about available opportunities for your new venture and don’t hesitate to contact a representative.
You have the vision, we have the roadmap to get there.
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