Created to Help Communities

IDAs are enabled by states largely to leverage congressionaly mandated IRS rules designed to provide local economic stimulation–or assistance to non-profit organizations–by providing reduced-cost borrowing to qualified applicants.

All issues receive a public hearing, issuance is typically approved by the IDA and submitted to the Board of Supervisors for final approval.

This IDA acts strictly as a conduit issuer. There is no risk or negative economic impact to the County or the IDA for private issue transactions.

No Negative Local Tax Impact

Typically, lenders offer lower interest on IDA bond issues as a reflection of an IRS exemption to Federal tax upon the lender specific to a qualified transaction.

Manufacturing exemptions are allocated on a state-by-state basis each year. Wise localities use the full allocation.

IDA bonds are not "tax free" to the borrower, nor do they result in any loss of tax revenue to local IDA sponsoring juristictions.

The diagram below provides an idea of how IDA bond transactions function.

The IDA Is Not an Economic Development Department

The Loudoun County IDA operates independently from local government but in close coordination with the County Department of Economic Development, the Economic Development Commission and other similarly focused parties.

While implementation can vary by juristiction, operation of the Industrial Development Authority of Loudoun County is reflected in the following diagram.