Revolving Economic Development Initiative Fund (REDI)   |
The State of South Dakota provides the REDI (Revolving Economic Development and Initiative) Fund to promote primary job growth in South Dakota. This low interest loan fund is available to start-up firms, businesses that are expanding or relocating and local economic development corporations.
The REDI Fund provides up to 45 percent of a project's total cost. Companies should secure matching funds and be able to provide a 10 percent minimum equity contribution.
Eligible costs include:
• the purchase of land and the associated site improvements;
• construction, acquisition or the renovation of buildings;
• fees, services, and other costs associated with construction;
• the purchase and installation of machinery and equipment.
Click here for more information. |
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| MicroLOAN |
| The MicroLOAN South Dakota Loan Program is available to small businesses within the borders of South Dakota and South Dakota residents, including main street and retail operations, for working capital, equipment, real estate or other fixed asset project costs.
Microloan At-A-Glance |
Loan Participation |
Up to 50% of Total Project Costs |
Amount of Loan |
$50,000 Maximum |
Minimum Owner Equity |
10% |
Interest |
3% Fixed |
Term on Equipment |
10 Years |
Term on Real Estate |
20 Years |
Balloon Payment |
5 Years |
Click here for more information. |
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| Property Tax Abatement |
The City of Sioux Falls has an ordinance that allows new industrial structures or additions to existing industrial structures to be taxed at a lower rate. This abatement ordinance results in a savings of property tax normally paid during the first five years following construction. The following chart illustrates the percentage of taxable value used through the first five years.
| Years Following Construction |
Percentage of Taxable Value Used |
| 1st |
-- |
| 2nd |
20 |
| 3rd |
40 |
| 4th |
60 |
| 5th |
80 |
| 6th plus |
100 |
A number of the smaller communities within Minnehaha and Lincoln Counties have also enacted property tax abatement ordinances. For information, contact the Lincoln or Minnehaha County Economic Development Association at 605-339-0103. |
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| Sales Tax Refund |
| The City of Sioux Falls enacted an ordinance that authorizes a refund of city sales taxes on capital machinery and equipment for qualifying projects. The refund applies to a new construction project that adds at least $5 million in taxable value to the city's property tax base, or an investment in non-realty capital assets of not less than $10 million, or a combination of new construction and non-realty capital assets exceeding $10 million. |
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| Dakota Business Finance |
| Dakota Business Finance is a local non-profit agency that administers the SBA 504 loan program that provides direct loans with long-term fixed rate financing for up to 40% of total project costs. Working in collaboration with the banks the required owner equity is 10% (slightly higher for start-ups). Qualifying projects include; land and building acquisition, construction or renovation and purchase of durable machinery or equipment (useful life of at least 10 years). Rates are adjusted based on the current market. For more information, visit www.dakotabusinessfinance.com. |
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| South Eastern Development Foundation Revolving Loan |
Created to assist companies with "gap" financing, this program includes funding for:
• Land
• Buildings
• Permanent Fixtures
• Equipment/Machinery
• Working Capital
Loans will be amortized according to the following schedule with all loans carrying a five year balloon:
• Land 20 years
• Buildings 20 years
• Permanent Fixtures 20 years
• Equipment/Machinery 15 years
• Working Capital 7 years
The interest is current prime and is fixed for the life of the loan. The minimum loan amount is $20,000 and the maximum is $150,000. All loans will be made in cooperation with an established bank or financial institution. More information can be found at www.secog.org. |
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| REED |
The REED Fund is a non-profit tax-exempt 501(c)(3) corporation, formed through the collaboration of rural electric cooperative members of East River Electric Power, Inc. REED is available in many of the MCEDA and LCEDA communities. The mission of the REED fund is to provide financing and help leverage private investment in small communities and rural areas.
REED At-A-Glance |
| Loan Participation |
Up to 50% of Total Project Costs |
| Amount of Loan |
$30,000 Maximum |
| Minimum Owner Equity |
10% |
| Interest |
Fixed at time of closing |
Click here for more information. |
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| Workforce Development Training Grants |
It is not only business leaders, but the people themselves that value and take advantage of the quality and variety of education and training that is available in our immediate area. The local high school graduation rate is consistently among the highest in the U.S. An already well-equipped and productive workforce is prepared to learn new skills as evidenced by the nearly 10,000 adults currently attending one of a dozen colleges, universities or technical institutes in the city of Sioux Falls. Business partnerships at every level of training and education are encouraged and common. Customized training programs are being designed to meet specific company requirements. South Dakota's Workforce Development grants can provide substantial assistance to train new workers or upgrade the skills of existing workers.
Information can be found at http://www.sdreadytowork.com/Financing-and-Incentives--Workforce-Development.aspx or feel free to contact our office at 605-339-0103 and we can put you in contact with the local workforce development rep from the State. |
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