Iowa Finance Authority

Private Activity Bond Cap Allocation

In 2018, the state of Iowa received $330 million of Private Activity Bond Cap ("Cap") for allocation to certain private activity bonds. These include industrial revenue bonds, affordable multifamily housing bonds and other purposes specifically defined by the IRS. Section 7C of the Iowa Code distributes the State Ceiling among these types of bonds.

Application Process

If an allocation of Cap is needed, an application is completed and submitted to the Governor’s Designee, along with an application fee of one basis point (.01%).  Applications may be submitted any time after the project has an inducement resolution from the Issuer. The amount of Cap requested cannot be more than the amount of the inducement resolution. The following parameters surrounding application apply:

  • After an allocation is made, a second fee of one basis point (.01%) is due. The project has 120 days (with a possible 30-day extension) in which to close the bonds.
  • After the bonds are issued, a representative of the Issuer must complete and return the Notice of Issuance and Delivery of Bonds within 10 days of the delivery date for the bonds. If the actual principal amount of bonds is less than the amount of the allocation, the allocation is automatically reduced to the principal amount of the bonds.

Lori Beary | Community Development Director