Industrial Revenue Bonds (IRBs) are available to for-profit companies that are expanding, not-for-profit organizations that are developing new facilities, affordable housing projects associated with tax credits and developers with projects in designated redevelopment areas.
For profit companies may be considered for IRBs if they are investing capital to develop new facilities, adding machinery and equipment and creating new jobs.
To qualify, companies must generate the majority of their revenue from outside of Sedgwick County and wages for the new jobs must meet certain standards.
Doc's Friends utilized IRBs for a sales tax exemption for a museum and education center for Doc, a Boeing B-29 Superfortress, manufactured in Wichita.
IRBs are available to private, not-for-profit 501(C)3 organizations adding new facilities. The organization is typically eligible for an ad valorem property tax abatement based on the 501(C)3 tax status of the organization and therefore a tax abatement request is not usually associated with this request. The organization can benefit from a sales tax exemption on construction materials as well as a potentially lower interest rate (tax-exempt interest rate) on financing based upon the organizations’ credit and ability to sell the bonds to the market.
The benefits associated with IRBs include a potential sales tax exemption on construction materials as well as a potential tax abatement. The percentage of tax abatement is based on a variety of criteria and may be for a period of up to ten years, with a compliance review at the five-year mark. Please see the
Economic Development Guidelines for further details. The bonds are not typically sold to the market (for-profit projects). For-profit entities qualifying for IRBs utilize traditional financing for its project, with the bond issue being subordinate to the debt. Therefore, the interest rate is not normally lower due to the use of IRBs.
Bombardier Wichita Service Center