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County receives briefing on industrial revenue bonds and exemptions
Summary
Outside counsel Bob Perry explained how industrial revenue bonds (IRBs) and project-exemption certificates (PECs) work, emphasizing the county serves as a conduit and does not assume debt; the briefing was educational and no action was taken.
The commission heard an educational briefing from attorney Bob Perry on industrial revenue bonds (IRBs), project-exemption certificates (PECs) and typical payment-in-lieu-of-tax (PILOT) arrangements used to incentivize economic development.
Perry described the statutory process: a company requests county involvement, the governing body may pass a resolution of intent, the county publishes notice to affected taxing jurisdictions (including the local school district), and, if appropriate, staff and counsel prepare leases and bond documents. He emphasized the county is a conduit under Kansas law and does not take on statutory liability for the bonds.
"Under the statutes, the commission would pass what is called a resolution of intent under which it expresses its intent to issue industrial revenue bonds... and it is the lynch pin to permit the company to request a project exemption certificate from the Department of Revenue," Perry explained, walking through steps and typical negotiated PILOT arrangements.
Economic-development director Natalie Montero asked clarifying questions about lease terms and how pilot payments are structured; Perry said exemptions are commonly limited to 10 years by statute but may be stair-stepped if the commission prefers.
The briefing concluded with counsel offering to provide a written one-page synopsis of the county’s role and typical documents for commissioners and staff.
