Dock and Wharf Bonds
What They Are
Dock and Wharf Bonds
The Western Illinois Economic Development Authority (WIEDA) acts as the issuer of the bonds, passing its DOUBLE tax-exempt status on to “exempt facilities” for certain type of projects to finance a building project or other capital project. These exempt facilities include Docks and Wharfs. The project can include the acquisition of fixed assets including land, buildings, and equipment. Because the interest on the bonds is not subject to state or federal income taxes, investors and lenders require a lower interest rate to achieve an equivalent after-tax return. Therefore, the borrower receives a preferential interest rate, generating substantial savings.
Eligibility
Major Requirements Include:
Fund Usage
Funds can be used to build a facility, acquire necessary land, new equipment, etc.
Capital Improvements
The capital improvements must take place in the territory of WIEDA in the counties of Adams, Brown, Cass, Fulton, Hancock, Henderson, Mason, McDonough, Morgan, Pike, Schuyler, Scott and Warren.
60 Day Notice
Funds expended prior to sixty days before receiving initial approval from WIEDA may not be eligible.
Benefits
If Approved:
Lower Interest Rate
A WIEDA Double Tax-Exempt Bond is exempt from state and federal income taxes, making it an attractive investment for the bondholder. The interest rate available on these bonds is far lower than conventional financing, and a lender can expect an interest savings to range from 150 – 300 basis points lower than a conventional loan.
100% Financing
Finance up to 100% of the project cost – contingent upon meeting credit standards of a lender backing the bond.
Smooth Process
WIEDA has been described as a “Nimble Issuer” because of its flexible guidelines and an expedited approval process. WIEDA can assemble a team of bond specialists who have a thorough understanding of all the legal and financial aspects of this type of transaction. We’ll work closely with you every step of the way, answering your questions, helping you avoid pitfalls, and making sure you get the financing that’s right for you.
