CDA

Industrial Revenue Bonds

  • About the Program:
    1. Interest on bonds is exempt from federal and state income tax–resulting in lower debt service
    2. Bonds are repaid from project and/or borrower’s revenues
    3. Flexible amortization and maturity–up to 40 years or 120% of the economic life of the asset financed
    4. Bonds can equal 100% of project cost
    5. Bonds are customarily credit-enhanced when sold to the public: privately placed bonds may not require credit enhancement
    6. Bonds are customarily secured by mortgage or security interest
  • Eligibility:
    1. Borrower must usually be a manufacturer—eligible non-manufacturing projects include:
      • Water, waste disposal, sewage, local district heating/cooling and government facilities
      • 501(c)(3) corporations
      • Qualified redevelopment projects
    2. Total investment cannot exceed $10 million in the project town, measured over 6 years—3 years prior to and 3 years following bond issue
    3. Must obtain CDA "Inducement Resolution" before undertaking project/acquisition
    4. A company's total bonds outstanding nationwide are limited to $40 million
    5. Restrictions:
      • Bonds proceeds must be used for the acquisition of capital assets directly related to manufacturing
      • Certain non-manufacturing facilities ancillary and related to manufacturing are limited to 25% of bond proceeds
      • Other non-qualifying costs including cost of bond issuance may not exceed 5%
  • Use of Proceeds:
    Land (limited to 25% of bond proceeds) New machinery and equipment purchase, construct, expand or upgrade facilities Other capital assets directly related to manufacturing CDA Program - Industrial Revenue Bonds (IRBs)
  • Amount:
    Up to $10 million
  • Term Maturity:
    Up to 40 years or 120% of the economic life of the asset financed
  • Borrower's Process:
    1. Contact:
      Karin A. Lawrence
      860.258.7814
    2. Have the following available:
      • Description of the project
      • Breakout of estimated project costs
      • Description of business and products
      • 3 years historic and 3 years projected capital investment

    See our CDA Lending Partners

  • For Additional Information on All CDA Programs: Contact CDA by email.

  • Applications: Industrial Revenue Bond Application