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Dear Scarborough business/organization/community member,
You are receiving SEDCO's new e-newsletter. As we mentioned last time, this has replaced the snail-mail version of our Business Bulletin newsletter we have done in years past. We hope you find it informative and helpful and enjoy the new format. This issue is a targeted business assistance issue about the Pine Tree Zone program, Recovery Zone Facility Bonds, and Efficiency Maine. |
I. Pine Tree Zones (PTZ)
● In June of 2009, LD1473 was passed by the Maine Legislature and signed by the Governor. PTZ benefits are now available state-wide, if your business is in the following industry: biotechnology; aquaculture and marine technology; composite materials technology; environmental technology; advanced technologies for forestry and agriculture; information technology; manufacturing, including precision manufacturing technology; or financial services.
● If you apply and are certified now (as a business located in Cumberland County), you can receive five years of benefits.
● A PTZ-certified company would need to create one net new job within two years (meeting per capita income (in Cumberland County, that's $40,435 but that can include the value of benefits), and provide access to group health insurance, and provide access to an ERISA qualified retirement plan).
● PTZ benefits greatly reduce or virtually eliminate taxes for your business (this includes opportunities for income tax credits, ETIF, sales tax exemption/reimbursement, and reduced utility rates).
● Please see the attached pdf for more information, or contact Brian Doyle, Business Development Specialist, at bdoyle@gpcog.org or 207-615-6686 for more information or an application.
II. Recovery Zone Facility Bonds (RZFB)
● RZFBs are tax-exempt bonds administered by FAME that can be used to finance private capital projects anywhere in Maine, including many projects that would not have been eligible for tax-exempt bond financing prior to ARRA. RZFBs can be issued to finance the acquisition or construction of assets for qualified businesses.
● Until June 1, 2010, each county initially has exclusive control of 50% of their allocated amount ($39,174,000 for Cumberland County). At a minimum, the businesses must obtain and submit a letter from the county in which the project is located indicating that the county supports the project. For applications prior to June 1, 2010, the county must specifically agree to the allocation to the project and sign a form to that effect. After June 1, 2010, any unallocated availability will become accessible to any project within the entire state. These allocations will be administered by FAME. ● RZFBs may be used by most private businesses to finance the purchase or construction of depreciable business property.
● RZFBs may not be used for golf courses, country clubs, massage parlors, hot tub facilities, suntan facilities, racetrack or other facilities used for gambling or stores principally for the sale of consumption of alcohol off-premises as well as residential rental properties. Proceeds from the bonds may not be used to refund existing debt or for working capital. Reimbursement of expenditures financed with short term debt issued after the adoption of ARRA are not considered refundings.
● These bonds allow private entities to borrow funds for eligible projects at lower borrowing costs based on federal tax incentives. These bonds are loans and not direct grants or appropriations like some stimulus programs. The bonds are sold to a private party or on the public markets, and the proceeds from such sale are loaned to the business. The loan is pledged to secure the bonds, and the business agrees to repay the bond by making direct loan payments to the private party bondholders or a trustee on behalf of public bondholders. ● There is no direct money available at FAME. This program allocates the authority to FAME to issue tax-exempt bonds to bond investors in order to assist in the financing of Recovery Zone facilities; it is not a direct funding program. The funds must be provided by a bank or other financial institution willing to buy the bonds and hold the loan that secures the bond (a "private placement"), or from sale of the bonds on the public markets arranged by an underwriter and may be supported by a letter of credit from a highly rated bank (a "public sale").
● The expense of issuance can range between $30,000-$50,000; therefore a bond amount of less than $2 million is not likely to be cost effective.
● The bonds must be issued by 12/31/10; however, the project need not be completed by that date.
● A borrower should assume it will take three months to complete the public hearing process and bond issuance. ● The business must provide FAME a complete application, including a financial commitment, which may be subject to receipt of an allocation.
III. Efficiency Maine
● Efficiency Maine is currently offering several different kinds of incentives for businesses to "go green." ● For small businesses, low-interest loans are available to help you finance energy-efficient upgrades. Your small business can borrow up to $35,000 at just 1% interest (current fixed rate, subject to change).
● Efficiency Maine offers businesses cash incentives to buy energy efficient lighting fixtures, HVAC systems, motors, controls and refrigeration. Incentives vary and do require an application, but businesses are eligible for up to $300,000 in incentives during a given year.
● For further information, contact: 866-376-2463 or efficiencymaine@maine.gov
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Thank you for reading our e-newsletter. We will be in touch again soon.
Sincerely,
Scarborough Economic Development Corporation
(SEDCO) |
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