Warren County Port Authority

Tax Exempt Financing

Tax-exempt financing lowers a borrower’s costs for a project because bond investors and other lenders require a lower interest rate on tax-exempt bonds issued to finance the project in order to achieve the same after-tax return as taxable bonds. The Port Authority is an eligible issuer of tax-exempt bonds under federal law.

Infrastructure Financing

Both private sector businesses and public sector entities can finance public infrastructure projects through the Port Authority’s infrastructure financing program. Examples of public infrastructure projects include roads, sidewalks, street lights, public parking garages, underground utilities, landscaping, and other improvements that primarily benefit the public. The Port Authority can assist local governments and developers in utilizing tax increment financing (TIF) to pay the costs of public infrastructure.

Manufacturing Bonds

Certain small- and medium-sized manufacturing businesses can utilize the Port Authority for tax-exempt financing. The federal government permits the Port Authority to issue tax-exempt “qualified small issue bonds” on behalf of manufacturing businesses that do not invest more than $20 million in Warren County, Ohio over a six-year period of time covering the date of the bond transaction. “Qualified small issue bonds” may be issued in principal amount of up to $10 million to fund assets used by the manufacturing businesses. The proceeds of “qualified small issue bonds” must be used according to two key restrictions: 1) 95% of bond proceeds must be used to pay the costs of depreciable assets used in the manufacturing process, and 2) 75% of bond proceeds must be used to pay the costs of assets that are “core” assets of the manufacturing process. An allocation of “volume cap,” or issuing authority, must be obtained from the Ohio Department of Development for “qualified small issue bonds” issued within the State of Ohio, and the Port Authority can assist in obtaining such an allocation.

Tax Exempt 501 (C) (3)Bonds

501 (c) (3) non-profit organizations can utilize the Port Authority for tax-exempt financing. All 501 (c) (3) non-profit organizations are eligible for tax-exempt financing for capital improvements, including buildings, building improvements, and equipment as long as their projects satisfy federal tax rules for tax-exempt 501 (c) (3) bonds. Specifically, 95% of the proceeds of any tax-exempt 501 (c) (3) bonds must be used to pay the costs of capital improvements owned and operated by the 501 (c) (3) non-profit organization.

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