Commission OKs industrial revenue bonds and tax exemptions for Hillsborough Industries (Ordinance 5189-25)
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Summary
After a public hearing, the commission approved ordinance 5189-25 to authorize industrial revenue bonds for a new Hillsborough Industries facility; the financing structure includes federally tax-exempt A bonds and a $2 million B bond to document remaining project proceeds and enable property- and sales-tax exemptions.
The Newton City Commission approved ordinance 5189-25 to authorize industrial revenue bonds for a new manufacturing facility constructed by Flint Hills Industries, doing business as Hillsborough Industries.
Sarah Steele of Gilmore and Bell, the city's bond counsel, described the financing: about $8 million has been spent on buildings and additional equipment and furnishings will be financed; Equity Bank is the lender purchasing the federally tax-exempt 2025 A bonds, and a $2,000,000 2025 B bond documents the remainder of the project to make it eligible for a property-tax exemption and sales-tax exemption on construction materials. Steele explained that under the Internal Revenue Code and the Industrial Revenue Bond Act, certain manufacturing facilities may qualify for federally tax-exempt bonds under specified caps.
Mike Gerken, president and CEO of the company, was present for questions but no members of the public spoke. Commissioners moved and approved ordinance 5189-25 by voice vote.
The approval authorizes the bond issuance consistent with the structure described at the hearing; the staff noted the action is intended to support local investment and potentially favorable borrowing terms.