The Caledonia EDA Intermediary Revolving Loan Program provides low-interest loans to businesses and individuals to promote job creation and retention, reduce blight, increase the tax base, and provide needed services in the community.. These loans provide gap financing and may be used for land acquisition, new construction, site improvements, renovations, machinery, and fixtures. Loan amounts are generally available for up to $25,000, but vary depending on the extent of the public purpose served by the project and the economic feasibility of the project.
The EDA offers assistance to commercial property owners in the Downtown Redevelopment Area who want to make physical improvements to the exterior of their building. Up to 33% of the project cost will be a forgivable loan; 33% percent of the project cost will be a 3% low-interest loan, and 34 % of the project cost will be owner’s equity. The Commercial Rehab Loan Program is administered by the Community and Economic Development Associates (CEDA).
3) Tax Abatement
The City of Caledonia offers tax abatements for economic development purposes. A tax abatement allows a property owner to receive a refund on a portion of their yearly property tax for a parcel. The abatement is usually based on the increase in a property’s value from a construction or renovation project. The yearly percentage of the abatement and duration vary based on the amount of the business investment and job creation.
4) Tax Increment Financing
For qualified applicants the City of Caledonia may institute a tax-increment financing district (TIF), in which the city would use the additional property taxes that a new real estate development project generates to assist with the costs of the development.