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Recovery Act makes Forsyth eligible for $20M
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Cumming – Forsyth County is eligible under the American Recovery & Reinvestment Act for $20 million in bonds. The act allows the county's Development Authority to issue bonds for economic development and also for county infrastructure.
Forsyth Commissioner Patrick Bell said the bond allocation is based on unemployment numbers, determined through a formula comparing figures in June of this year versus historic unemployment. The county is eligible for $12.453 million in Recovery Zone Facility Bonds, and another $8.302 million in Recovery Zone Economic Development Bond allocations.
"It's not grant money. It's not free money," Bell said. "It's bonds that are backed by the U.S. Treasury, not Forsyth County. The incentive is that the federal government underwrites 45 percent of the interest cost."
The bonds can be used in recovery zones:
a) significant poverty, unemployment, or home foreclosure rates,
b) federally designated empowerment zones and renewal communities, and
c) areas negatively impacted by military base closures
The Recovery Bonds can be used to finance new capital improvements owned and used by almost any:
• Industrial
• Commercial
• Retail
• Office
• Or other business activity located in a "recovery zone"
Exceptions include rental housing, airplanes, health clubs, liquor stores, race tracks, luxury boxes, gambling massage parlors, etc.
The Economic Development Bonds can be used as a tax credit bond or "direct pay" taxable bond with a 45 percent direct subsidy from the U.S. Treasury on interest payments.
Proceeds must be used for a "qualified economic development purpose" defined as:
• Capital expenditures paid or incurred with respect to property located in a recovery zone, including:
• Land
• Buildings
• Equipment
• Expenditures for public infrastructure and construction of public facilities.
Tags: Cumming, Forsyth County
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