Recovery Zone Facility Bonds
Recovery Zone Facility Bonds (RZFBs) are a new type of tax-exempt private activity financing created by the 2009 American Recovery and Reinvestment Act (ARRA).
Congress created RZFBs to encourage capital investment in areas designated as recovery zones. Counties and large municipalities across the United States have been allocated a specific dollar amount of these bonds based on aggregate employment declines. St. Louis County has been allocated $60 million.
The RZFB process will be managed and issued by the Industrial Development Authority of St. Louis County (IDA). All RZFBs must be issued before January 1, 2011.
Eligible Use of Bond Proceeds
Bond proceeds must be used for Recovery Zone Property, which is any property that is (1) subject to a depreciation allowance and (2) first used in St. Louis County by the taxpayer receiving the bond proceeds. This excludes land and working capital as well as residential rental and certain prohibited businesses (e.g. country clubs, massage parlors, private or commercial golf clubs, and suntan facilities). The Property must be located in St. Louis County.
Bond Size Limitations
The minimum bond amount is $500,000. While there is no maximum amount, larger requests (over $5 million) will be carefully evaluated in terms of positive economic impact within St. Louis County, as detailed below.
Financing Commitment Needed
Prior to any RZFB application submitted to St. Louis County IDA, the applicant must obtain a financing commitment for the bonds. This would include a letter from a bank indicating its commitment to purchase the bonds or a letter of credit from a bank that would be used as credit enhancement for publicly issued bonds.
No application will be considered without a financing commitment.
Project Evaluation Criteria
Applications will be evaluated based on the project's overall impact on the St. Louis County economy. Criteria include:
- Amount of net new property taxes projected to be generated by the investment
- Amount of investment in buildings and equipment
- Number of jobs retained, created or relocated to St. Louis County from outside the State of Missouri
- History, growth and success of the business measured in sales/revenues, job growth, product/service diversity
- Potential that the project investment will enhance a geographic area of the County and/or result in additional private investment
- Consistency of the project with St. Louis County's Master Plan and Zoning
- Ordinances
- Extent to which the development interest commits to purchase services, equipment and construction services with companies located in St. Louis County
- Projects where construction activities can commence within 90 to 120 days of bond placement
- Projects registered and tracking for LEED certification with the U.S. Green Building Council
Apply here
Click here to download an application. Please print and mail the completed application to 121 S. Meramec, Suite 900, St. Louis, MO 63105.
For additional information on RZFBs, contact Rick Palank at 314.615.7667.
