The Agency offers a variety of types of financial assistance to project applicants including taxable and tax-exempt financing, exemptions from real estate taxes, mortgage recording taxes, and sales and use taxes.
Under the Internal Revenue Code, interest on certain revenue bonds issued by the Agency with respect to a project located in Chautauqua County is exempt from federal income taxation (“tax-exempt financing”). Tax-exempt financing provides a project beneficiary with both access to the public markets and significantly lower interest rates than those offered through traditional financing. If a project is not eligible for tax-exempt financing, the Agency can issue taxable financing for said project. Taxable revenue bonds that are sold in the public market may also result in lower interest rates and debt service payments. The three most common types of tax-exempt revenue bonds issued by the Agency are Civic Facility Revenue Bonds, Small Issue Manufacturing Revenue Bonds and Exempt Facility Revenue Bonds.
Chautauqua County Capital Resources Corporation (the Corporation)
The Corporation undertakes project either on its own behalf, or for the benefit of an applicant. The Corporation can undertake any project that promotes community and economic development and the creation of jobs in the non-profit and for-profit sectors for the citizens of Chautauqua County. This is accomplished by developing and providing programs for not-for-profit institutions, manufacturing and industrial businesses and other eligible entities to access low interest tax-exempt and not-tax-exempt financing for their eligible projects, as well as projects and activities within the County for the purpose of relieving and reducing unemployment, bettering and maintaining job opportunities, carrying on scientific research for the purpose of aiding the County by attracting new industry or by encouraging the development of, or retention of, an industry in the County, and lessening the burdens of government and acting in the public interest. (The Chautauqua County Capital Resources Corporation is a local development corporation formed under Section 1411 of the New York State Not-for-Profit Corporation Law.)
Small Issue Manufacturing Revenue Bonds
Tax-exempt Small Issue Manufacturing Revenue Bonds may be issued to finance facilities for the manufacturing or production of tangible personal property (including the processing resulting in a change in the condition of such property).
Exempt Facility Revenue Bonds
Tax-exempt Exempt Facility Revenue Bonds may be issued to finance certain facilities enumerated in Section 142 of the Internal Revenue Code, including certain airport facilities, docks and wharves, mass commuting facilities, water and sewerage facilities, solid waste facilities, low income residential rental facilities, and certain other facilities.
Real Property Tax Exemption/Payment in Lieu of Tax Agreement.
Sales and Use Tax Exemption
The Agency is able to provide project beneficiaries with exemptions from state and local sales and use taxes. This exemption from state and local sales and use tax applies to items purchased in connection with the acquisition, construction and equipping of approved projects and generally may include construction materials, furnishings, equipment, consumables and tool rentals. Under the Agency’s Uniform Tax Exemption Policy, this exemption from state and local sales and use taxes will terminate upon completion of the project.
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. The Agency will consider project factors when determining the amounts to be paid under the PILOT Agreement. 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 the Agency, with input from the affected tax 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 tax jurisdiction had the project not been tax exempt due to the status of the Agency involved in the project.
The PILOT payment payable in the first tax year following the Completion Date of the project, and in each tax year during the Term of the PILOT shall be an amount equal to (i) the assessed value, times (ii) the tax equalization rate of the applicable taxing jurisdiction, times (iii) the current tax rate for the applicable taxing jurisdiction, times (iv) the applicable abatement percentage.
For purposes of computing the PILOT payment, the “Term of the PILOT” shall be ten (10) full fiscal years for each taxing jurisdiction following the Completion Date of the project. In the case of Adaptive Re-Use Projects or Tourism Destination Projects, the “Term of the PILOT” shall be fifteen (15)) full fiscal years for each taxing jurisdiction following the Completion Date of the project. See Uniform Tax Exemption Policy.
Payment under the PILOT program must be made by the applicant to the Agency or its designee at the time or times real property taxes must be paid. Neither the PILOT Agreement nor the Agency’s involvement with the project will abate special assessments, special district taxes or other special levies.
Mortgage Recording Tax Exemption
The Agency is able to provide project beneficiaries with an exemption from state and local mortgage recording taxes. In Chautauqua County, the current mortgage recording tax rate is equal to $1.25 for every $100 secured by the mortgage. This exemption from state and local mortgage recording taxes enables the Agency to substantially lower the cost of financing a project with debt secured by a mortgage and/or an assignment of leases.
Industrial Development Bond – Taxable
Eligibility is for primarily manufacturing and certain commercial projects for land, building acquisition/renovation/construction, new machinery and equipment. Minimum is $400,000, with no upper limit. Can be used for 100% of the project. Must have public economic benefit and result in job creation.
Chautauqua Revolving Loan Fund (CRLF)
Eligibility is for businesses, although other projects may be eligible, for real estate, machinery, equipment, and working capital. Loan limit is usually $75,000, maturing in 5 years. Must result in job creation/retention.
AL Tech Revolving Loan Fund “The History of AL Tech”
Eligibility is for primarily manufacturing concerns in Chautauqua County for real estate, machinery, equipment and working capital. Limit is 40% of eligible project costs with a maximum of $1 million, with 7 – 20 year maturity. Must result in job creation.