Secretariat

A Review of Economic and Industrial Development Programs in the State of Georgia

Direct Financial Programs

1. Regional Revolving Loan Funds

2. Business and Industry Guaranteed Loan Program

3. EDA Revolving Loan Fund Programs

4. Southeast Trade Adjustment Assistance Center

5. Community Adjustment and Investment Program

6. Appalachian Region Business Development Revolving Fund Program

7. Tax Exempt Industrial Revenue Bond Financing

Regional Revolving Loan Funds

• Authority: State of Georgia
• Objective: Job creation for persons of low-and-moderate income
• Applicants: For-profit businesses and local development authorities in designated centers
• Object: Below market rate loans and grants ranging from $25,000 to $500,000
• Conditions:
  • RLF committee determines loan amount, rates and terms
  • Adequate collateral
  • Personal guarantees
  • Commitment to create jobs

Business and Industry Guaranteed Loan Program

• Authority: US Dept. of Agriculture
• Objective: Rural economic improvement
• Applicants: Any legal entity operating within a city of less then 50,000 population
• Object: Guarantee loans to a maximum of 90 percent of loss resulting from borrower default
• Conditions:
  • Sufficient collateral
  • Maximum of $25 million per borrower
  • Guarantee fee = 2% of principal x % of guarantee
• Maturity:
  • 7 years for working capital
  • 15 years for machinery and equipment
  • 30 years for real estate
• Guarantee:
  • Exceptions = 90% guarantee
  • $10 million & up = %60 guarantee
  • $5-10 million = 70% guarantee
  • $0-5 million = 80% guarantee

EDA Revolving Loan Fund Programs

• Authority: US Dept. of Commerce through the EDA
• Objective: Business expansion & job creation
• Applicants: For-profit businesses
• Object: Below market rate loans ranging from $25,000 to $500,000
• Conditions:
  • cash flow exceeding debt
  • personal guarantees
  • adequate collateral

Southeast Trade Adjustment Assistance Center

• Authority: Georgia Tech Economic Development Institute
• Objective: Improve competitiveness
• Applicants: For-profit businesses that lost sales and employment due to intense import competition
• Object:
  • Operation assessment and recommendations
  • 50/50 cost sharing to implement recommendations
  • Maximum of $150,000
• Projects:
  • Developing new product
  • Reducing production inefficiencies
  • Market research
  • ISO certification
  • Machine design/automation

Community Adjustment and Investment Program

• Authority: Fed. Gvt. and North American Development Bank
• Objective: Assist communities adversely affected by NAFTA
• Applicants: Businesses located in a CAIP-eligible community
• Object: Job creation through loan guarantees
• Conditions:
  • 1 job created or preserved per $70,000 in federal funds in a 24 month period
  • 1 job created or preserved per $35,000 in NADBank funds

Appalachian Region Business Development Revolving Fund Program

• Authority: Georgia Department of Community Affairs
• Objective: Appalachian Region job promotion
• Applicants: Private for-profit organizations only
• Object: Below market rate loans to qualified businesses for job creation or retention.
• Criteria: Project viability, amount of other private investment leveraged by the project, number of jobs, created or retained, enhancement of downtown/redevelopment area.
• Limit: Up to $200,000 or 50% of project cost, whichever is less.

Tax Exempt Industrial Revenue Bond Financing

• Objective: Business development
• Applicants: For-profit businesses only
• Object: Below prime rate bonds not limited to areas with high degrees of economic need
• Criteria:
  • Cannot be used to acquire used buildings
  • Cannot be used for working capital
  • Bank letter of credit required
  • Processing/approval time greater than that of taxable bonds
• Limit:
  • Up to $10 million for real estate acquisition, construction, renovation, machinery and equipment.
  • $40 million total outstanding per corporation