The EDB, in partnership with the California Enterprise Development Authority (CEDA), facilitates bond financing to help Sonoma County manufacturing/processing firms and local Non-Profits to expand.
Industrial Revenue Bonds for Manufacturers
Industrial Development Bonds (IDBs) are tax-exempt securities issued by cities, counties, and joint powers authorities (JPAs), such as CEDA, to provide small- to medium-sized manufacturers money for land purchases, building construction, facility expansion, new production equipment acquisition, and solar and energy conservation retrofits. Benefits of IDB financing include below market interest rates, long-term financing, and it is available statewide without limitations to specific areas or communities. Overall, IDB financing reduces total financing costs so more capital can be invested back into the organization’s operations.
501c3 Revenue Bonds for Nonprofits
501(c)(3) revenue bond financing facilitates land and building acquisition, building construction, and refinancing of prior debt (for eligible capital projects). Benefits of this type of financing include below market interest rates, long-term financing, and it is available statewide without limitations to specific areas or communities. A 501(c)(3) revenue bond is preferred over a conventional loan because the interest is tax exempt and therefore the interest rate is significantly lower than bank financing. Over a long period of time, this can mean substantial savings to the borrower, depending on the amount financed, and reduces total financing costs so more capital can be invested back into the organization’s operations.
CEDA was established as a Joint Powers Authority (JPA) by the California Association for Local Economic Development (CALED) to address gaps in economic development financing. Specifically, CEDA’s goal is to issue bonds for small to medium sized California manufacturers or nonprofits looking to grow or expand, and in some cases refinance.