The County
of Lewis Industrial Development Agency (LCIDA) usually participates by
taking title to, or a leasehold interest in, the real and/or personal
property
involved in the project. The LCIDA then:
|
![]() |
1.
Mortgage Recording Tax Exemption
Whenever
a county clerk records a mortgage in New York State, the mortgagor must
pay a 1.00% mortgage recording tax -- a significant expense. The LCIDA
can,
however, qualify a Company for a mortgage recording tax exemption, if
the
LCIDA is in title at the time the mortgage is recorded.
2.
Sales and Use Tax Exemption
The
Sales and Use Tax in Lewis County is 7.75%. All purchases made by the
LCIDA
or its agents are exempt from the Sales and Use Tax. The LCIDA can
issue
a sales tax exemption letter to the Company, authorizing it to act as
an
agent of the LCIDA. The Company can then purchase the equipment,
materials
and services needed to acquire, construct, reconstruct and/or equip the
project without having to pay sales and use taxes.
3.
Real Property Tax Abatement
In
New York State, property owners pay a real property tax based on the
assessed
value of improvements to a site. Any real property owned or controlled
by the LCIDA is not subject to ad valorem real property taxes.
When
the LCIDA takes title to or a leasehold interest in real property, the
property becomes 100% exempt from ad valorem real property taxes. To
accommodate
the needs of the local taxing jurisdictions, however, the IDA generally
enters into a Payment in Lieu of Tax Agreement ("PILOT Agreement") with
the Company.
4.
Lower Interest Rates for Debt Incurred
as Part of the Project (2
- 3% lower than the conventional cost of borrowing)
The
LCIDA is authorized by New York State law to issue bonds and notes. The
LCIDA can issue tax exempt bonds, subject to the limitations imposed by
the Internal Revenue Code of 1986. The proceeds of these tax exempt
bonds
can be used to fund all, or substantially all, of the costs of a
project.
The LCIDA provides no credit enhancement, and issues bonds on a
non-recourse
basis. For that reason the ability to sell the bonds depends solely on
the creditworthiness of the Company. The lending institution reviews
the
project and makes the credit decision as to the purchase of the bonds.
In addition, the Company and financial institution negotiate the terms
and conditions of the loan independently of the IDA. Normally, the loan
is secured by a mortgage on the facility financed with the bonds.
However,
additional guarantees and collateral may be required by the lending
institution
- similar to requirements of conventional financing. Therefore, IDA
approval
of a project does not automatically result in funding being available.
The applicant is responsible for the bonds. Neither the
Agency,
County or State guarantee any such indebtedness.
*These
benefits are subjects to change and need Agency Counsel and LCIDA Board
approval.
Other important links: Loan/Grants/Incentives | Local Incentives | Economic Partners
| Disclaimer
CATALOGonline (Products & Services) LCIDA Home |
|
|