Agency approves financing to allow Hope Cottages to purchase land

Hope Community Resources Inc. has purchased additional land and will expand its facilities through $1.6 million in new taxexempt financing through the Alaska Industrial Development and Export Authority and Wells Fargo Bank Alaska.

AIDEA's board approved issuing tax-exempt bonds to pay for the

Wells Fargo has agreed to buy the bonds, according to Earl Carson, vice president for commercial real estate with Wells Fargo. Hope Community Resources will make payments directly to Wells Fargo, Carson said.

Most of the money will be used to purchase additional property near Hope Community Resources' present facilities on International Airport Road in Anchorage, but the financing will also pay for $206,000 in improvements to existing buildings, Carson told AIDEA's board.

The tax-exempt bonds are "conduit financing" where AIDEA, a state lending agency, issues taxexempt bonds but the borrower is pledged to repay the financing.

The assets of the authority are not pledged to back the bonds, said Ken Vassar, an attorney with the law firm of Wohlforth, Vassar, Johnson and Brecht.

Vassar's firm advises AIDEA on legal issues related. to its bond issues.

The Internal Revenue Service allows tax-exempt financing for certain types of private-sector projects, 'including activities of nonprofit social service corporations.

The IRS requires all such financing to be done by a public agency, but leaves it up to individual states to designate which agencies will issue the bonds, Vassar said.

In Alaska, AIDEA has been designated to issue tax-exempt bonds for private projects, although Alaska Housing Finance Corp. also issues tax-exempt bonds for nonprofit housing corporations in the state, Vassar said.