WEDFA is very excited to be teaming up with the Washington State Department of Commerce (Commerce) to offer the Renewable Energy Manufacturing Program. The program consists of two key ingredients: WEDFA Bonds and an interest cost subsidy on those bonds from Commerce.
PLEASE BE AWARE THAT PROJECTS MUST BE APPROVED FOR WEDFA FINANCING BEFORE THEY ARE ELIGIBLE FOR THE COMMERCE INTEREST COST SUBSIDY.
ALSO PLEASE NOTE THAT THE BORROWER IS RESPONSIBLE TO LOCATE AND RETAIN THE ULTIMATE SOURCE OF CREDIT ON THE TRANSACTION (MOST LIKELY A COMMERCIAL BANK). IN THE FIRST ROUND OF FINANCINGS UNDER THE PROGRAM, NO APPLICATIONS WILL BE CONSIDERED FOR THE COMMERCE INTEREST COST SUBSIDY AWARD UNLESS SUCH FINANCING HAS BEEN ARRANGED.
To qualify for WEDFA Bond financing, the project generally needs to be a manufacturing and energy production support facility. Bond may be either “tax-exempt” or “taxable”. Although the tax advantages of “tax-exempt” bonds only directly benefit the purchaser of the WEDFA bonds, the purchaser should be willing to offer a lower interest rate to the project, reducing the borrower’s debt service costs.
To qualify for tax-exempt financing, the borrower will need to meet the applicable federal tax requirements. Click here to learn more.
The project must establish new or expand existing:
For purposes of this program, “renewable energy” includes but is not limited to:
In order to qualify for this competitive award, the manufacturing project must first be chosen to receive economic development bonds, to be issued and sold by WEDFA and financed with loans made by private lenders to the owners of the facilities financed with the bonds. Once this requirement is met, the project can be considered for the competitively awarded interest cost subsidy to be paid to borrowers from Commerce. The interest cost subsidy will reimburse borrowers for up to the lessor of $3 million or 80% of the interest due on the qualifying loan.
For those projects awarded the interest cost subsidy, award payment will be received on a monthly basis until the total amount of the award has been paid to the project. Each month Commerce’s program manager or a designated third party will confirm that:
Once these two conditions have been satisfied, Commerce will release payment to the borrower in the amount equal to the interest paid for the month in question. This will continue until the full amount of the award has been paid to the borrower.
Commerce and WEDFA will accept applications on a rolling basis. The first application deadline will be June 30, 2016, at which time all applications received to this point will be subject to a scored review and award decision. If Commerce has funds available for the interest subsidy after awards from the June application deadline, applications will continue to be accepted and reviewed for award on September 30, 2016, and December 21, 2016, if required. Commerce reserves the right to change some program parameters to impact program utilization.
To qualify for financing, please Click here.