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Letter from the Executive Director
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The construction of the 46 Lease-to-Own units in East Alton is complete and the ribbon cutting was held in early summer. All 46 homes are rented. There is some minor landscaping to be completed. The Village of East Alton has also removed several housing structures to give a more open view of the park and civic center.
I would like to thank SWIDA's partner Rise, Senator Bill Haine, State Representative Dan Beiser, Madison County Chairman Alan Dunstan and the Economic Development team, DCEO State of Illinois, Illinois Housing Development Authority (IHDA), the Village of East Alton and many others for their dedication to see this development funded and completed.
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SWIDA's East St. Louis Development Loan Fund
In the last issue it was mentioned that in SWIDA's enabling legislation, it was specifically stated that the SWIDA Board "study and make recommendations on the economic development of the City of East St. Louis and the economic development of the riverfront."
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The eventual outgrowth of that mandate was the creation of a $7 million loan fund that SWIDA called the East St. Louis Development Fund. The Fund was established by the sale to the developers of the Casino Queen of 30 acres SWIDA owned adjacent to the East St. Louis riverfront. The land was originally acquired by SWIDA for the then hopeful expansion of the Gateway National Park to the east side.
When it became apparent that the expansion of the National Park was unlikely to ever get funded, riverboat gambling legislation coincidentally was enacted. SWIDA sold the land to the then developing Casino Queen. Part of the sales price included the provision that the Casino Queen pay into a loan fund to be managed by SWIDA. The Fund was to make loans to businesses and not-for-profit agencies located only within the corporate limits of the City of East St. Louis. The Fund was structured as a loan fund so that through repayment of the loans the Fund would continue into perpetuity.
Among the many projects funded, the following are major well-known projects that have made significant, positive impacts on the City of East St. Louis: Comprehension Mental Health: Financing of new corporate headquarters and consolidated services building in downtown East St. Louis. Parson's Place Housing Development: Development financing for McCormack Baron's 276 unit affordable housing rental development in the Emerson Park Neighborhood. Community Development Corporation: Construction financing of single family housing projects in the south side and throughout the City of East St. Louis. Eagles Nest Veterans Shelter: Renovation of former National Guard Armory at 51st and State into a 27 bed long-term residential and rehab center. Jackie Joyner Kersee Center: Funding to help reopen and renovate the facility. Emerson Park Redevelopment Corporation: Remodeling of new office and school. East St Louis Park District: Repair and update maintenance to the Community Center at Kenneth Hall Park (formerly Jones Park).
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Where Are They Now?
SEV-REND CORPORATION
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In 2007, SWIDA issued an Industrial Revenue Bond to $3.5 million to Sev-Rend Corporation for construction of their new 40,000+ square foot facility in Collinsville, IL.
Sev-Rend Corporation is one of the leading packaging manufacturers for the produce industry and was originally founded in 1993 by Bob Williams and his son, Rob Williams. The firm started with the manufacturing of strip tags for one product: onions. Customers had the option of buying the first tags with one, two or three colors. The original facility was located on 3rd St in downtown St Louis, across the street from the Edward Jones Dome. By 2006, Sev-Rend needed to expand to a modernized facility that would aid in the growth of both production and capabilities.
In two decades, the Williams family has exponentially expanded beyond its one employee and first product. Tags are not the only things Sev-Rend is producing today. Other products such as labels, flexible packaging and netting are now produced in Sev-Rend's facility. The expansion of the packaging market has forced Sev-Rend to focus on and stay ahead of industry trends. Constantly evolving to the food grade packaging industry needs.
In 2007 SWIDA was able to structure a bond deal to help aid Sev-Rend in the development and construction of this much needed new facility located on Horseshoe Lake Rd in Collinsville, IL.
In 2008, Rob Williams moved Sev-Rend from St. Louis to a new, modern facility located in Collinsville, IL. This move allowed Sev-Rend to grow their printing and manufacturing equipment to expand its product line. With this move, Sev-Rend was also able to expand their team to over 25 full time employees running multiple shifts within the facility. Rob said the multiple functions of his plant enable Sev-Rend to have "some of the shortest lead times in the industry."
Sev-Rend is a great example of the interest saving financing SWIDA can provide, especially for a manufacturing business.
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Office Space for Rent at SWIDA Location
Contact: BARBERMurphy Group ∙ 1173 Fortune Boulevard Shiloh, IL 62269 ∙ Office 618-277-4400
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Through its enabling legislation, SWIDA has been given a wide variety of powers to: finance, buy, sell, own, create, and manage almost any type of activity that would contribute to the economic development of SWIDA's four- county region.
SWIDA's main tools for fostering economic development include:
Issuing tax-exempt revenue bonds:
For all bonds issued through SWIDA, the buyer of the bonds does not only not have to pay Federal income tax, but also does not pay State of Illinois income tax on the interest they receive from buying the bonds. The project has to meet Federal IRS guidelines to qualify to be Federal tax-exempt.
The bonds are not bought or guaranteed by SWIDA or any other governmental entity. The bonds are sold in the private financial markets to individuals or institutions solely on the strength of the project and the company borrowing for the project. If the company financials are not strong enough to meet the market requirements, they may have their local bank guarantee or buy the bonds directly.
Advantages of tax-exempt financing:
The main and very strong advantage of tax-exempt bonds is the significantly lower interest rate the borrower pays. Because the buyer of the bonds does not have to pay income tax at all on the bonds, the buyer is willing to accept a lower tax-exempt interest income. This is similar to an individual buying municipal bonds for one's personal financial portfolio. In fact most SWIDA bonds can be bought by individuals.
The lower differential interest rate can be as much as 1.5% to 2% annually, which over the course of a typical 20-year, multi-million dollar bond issue can add up to significantly large actual dollars saved from financing of the project. Depending on the size of the project, the overall savings over the life of the bonds can range from at least hundreds of thousand dollars to several million dollars.
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James Nations, Chair
Reggie Sparks
Barbara Johnson
Khalil El-Amin
Jim Sullivan
Dave Willey
David Miller
Kennard Tucker
John Hipskind
Kevin Kaufhold
Greg Kuehnel
Joseph Gray
Tom Hoechst
Mike Lundy, Exec Dir
Joe Gasparich
Teri Rumsey
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Southwestern Illinois Development Authority
1022 Eastport Plaza Dr
Collinsville, Illinois
62234-6121
(618) 345-3400
Email: [email protected]
www.swida.org
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Call (618.345.3400) or email Mike Lundy ([email protected]) if you have any interest in a bond issue for: warehouses, schools, factories, redevelopment, housing,business, industry, governmental or non-for-profits.
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SWIDA has issued $1.2 Billion in Bonds.
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