Industrial Revenue Bond Program
Industrial Revenue Bonds are available in North Carolina to assist private business development and expansion by issuing low-interest tax-exempt bonds.
Industrial Revenue Bonds, also known as industrial development bonds, IDBs, IRBs and qualified small issue bonds, offer qualified manufacturing facilities and certain solid waste disposal facilities convenient, long-term, flexible financing. They are available to assist new and expanding industry in all 100 North Carolina counties.
IRBs can be either tax-exempt or taxable and can be used to finance an entire project, including the cost of land, construction of new or expanded facilities, acquisition and installation of depreciable property such as equipment, and construction period interest.
The Industrial Facilities and Pollution Control Financing Authority of each county issues these bonds in the county where the project is located.
Due to the complexity and documentation associated with revenue bonds, a business should consult early in the process with an attorney who specializes in revenue bonds (bond counsel). Most county industrial facilities and pollution control financing authorities permit companies to designate bond counsel, although some have their own designated bond counsel.
Significant Requirements (Manufacturing IRBs)
- Manufacturing – Must be at least 75% manufacturing.
- Letter of Credit – Since all bond issues must be supported by a letter of credit, it is important to secure an early commitment from a bank which is rated investment grade or better. Most often, the bank that issues the letter of credit will place the bonds and may purchase them.
- Environmental Approval – No IRB project may be approved without environmental certification by the North Carolina Department of Environment and Natural Resources (DENR). If the company must obtain required permits, the process could take 60 to 90 days. DENR representatives will guide the company through the process.
- Abandonment – Company must certify that in building the facility, it is not abandoning another facility (or, if it is, that it is impossible for the company to remain at its present location because of limitation on land use, etc.).
- Jobs Test – Must create or retain number of jobs with the size of financing (currently one job for every $250,000 in financing).
- IRB Proceeds - May be used only for land, building and equipment (fixed assets).
Helpful Resources | Industrial Revenue Bonds
Industrial Revenue Bond Application
Employment Profile Form (Exhibit C)
For general information about the program, follow the links below:
Company’s Role in the Process
Approval Process Steps
Explanation of Application Exhibits
Industrial Revenue Bonds: Frequently Asked Questions (FAQ’s)