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Taxes & Incentives
SBA
The Region E Development Corporation, a non-profit corporation, formed in 1982, administers the SBA-504 program. This direct loan program offers growing and healthy small businesses partial financing which can be combined with bank financing and small owner equity participation. The 504 program can fund fixed assets and other specified fees. Working capital, inventory and operating expenses are not eligible costs for the 504 program, however many companies also have successfully used the SBA-7A program for these purposes. The Region E. Development Corporation provides information and technical assistance.
Community Development Block Grant - Economic Development Program
The North Carolina Community Development Block Grant-Economic Development (CDBG-ED) Program is one of the most widely used programs throughout Burke County. Its primary purpose is to lend necessary financial support to a project where jobs for low and moderate income persons will be created or retained. The financial support may come in the form of a direct loan to a company at a workable interest rate and term or the program may pay for the cost of a public infrastructure improvement.
This program is available in all of Burke County except in the corporate limits of Morganton. Due to its size, Morganton is no longer eligible to participate but has an economic development fund which is very similar to the state operated program.
Industrial Revenue Bonds
Industrial Revenue Bonds [IRB] are a form of long-term, financing for fixed assets. The income on the debt obligation of an IRB is exempt from income taxes. The Burke County Industrial Facilities and Pollution Control Financing Authority issue bonds with approval of the State of North Carolina.
The Authority was created in 1976 and has a history of numerous successful projects. Since IRB's cannot be used for debt refinancing, it is absolutely critical that an Inducement Agreement [also called a Memorandum of Agreement or Letter of Intent] be signed with the Burke Authority before any commitment of funds to the project is made. IRB's can only be used for manufacturing projects.
The focus of the IRB program is the creation of jobs that will raise the average wage level and reduce unemployment. Therefore, a company must pay a higher wage than the average manufacturing wage in the County.
IRB's can be used to purchase land, new or existing buildings and equipment, and to pay certain related fees and costs. Early contact with the BPED is critical because eligibility can be affected.
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