PIDA Loan Program Introduces Significant Enhancements for Borrowers
By Colin McEvoy on April 10, 2017
Significant program enhancements have been made to the state’s Pennsylvania Industrial Development Authority (PIDA) program, which offers low-interest loans and lines of credit to eligible businesses that commit to creating and retaining full-time jobs.
The changes include an increase in the lending limit for machinery and equipment loans funded by PIDA’s Machinery Equipment Loan Fund (MELF) program. Lending was previously capped at $400,000, but that cap has now been increased to $1.5 million.
In addition, PIDA added an option to its flagship real estate loan resource allowing for the extension of amortizations on these loans out to 20 years, where the program previously only offered terms and amortizations of 15 years.
“These changes are welcome, as they make PIDA’s machinery and equipment offering relevant to larger projects,” said John Kingsley, LVEDC Vice President of Finance.
“And the longer amortization option brings PIDA’s real estate financing program in line with its commercial lending counterparts,” Kingsley said. “With rates starting at just 3 percent, these programs have simply become an even a better option.”
The PIDA program provides many benefits to customers, including longer-term fixed rates for up to 15 years and a reduced equity requirement of only 10 percent in most cases.
“PIDA has really been trying to improve their loan offerings over the last several years,” Kingsley said. “Not only are they even better incentives for our local companies to expand and grow, but the organization itself has become so accommodative in their process that getting a loan through PIDA is easier than ever.”
For more information, contact the LVEDC Finance Department at 610-266-6775, or fill out a Financial Inquiry form on the LVEDC website.
More than 150 Lehigh Valley companies have received PIDA loans with assistance from LVEDC or its affiliates. Most recently, Michelman Steel Enterprises was awarded a $1.75 million PIDA loan to acquire and renovate a 71,150 square-foot manufacturing facility in Bethlehem, and Everson Tesla received a $450,000 PIDA loan for a 10,290 square-foot addition to its current facility in Lower Nazareth Township.
The MELF program applies to projects where PIDA is financing machinery and equipment acquisitions for eligible manufacturing, industrial, biotechnology, and computer-related service enterprises.
Lending under the MELF program requires a 50 percent match, and loans funded are subject to the job retention/creation requirements of one full-time job retained for every $35,000 loaned, and/or one full-time job created for every $50,000 loaned.
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