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New Markets Tax Credit News Briefs – March 2018

The Internal Revenue Service issued Feb. 8 Revenue Procedure 2018-16. The document provides guidance to the governors of any state about how certain population census tracts may be designated as qualified Opportunity Zones. Specifically, the revenue procedure clarifies the nomination process by informing the governors of each state which census tracts in their jurisdictions are eligible to be nominated and by providing the requirements and due dates for the nomination, certification and designation of the zones. In addition, the revenue procedure provides a safe harbor for applying the 25 percent limitation to the number of population census tracts in a state that may be designated as qualified opportunity zones. Revenue Procedure 2018-16 was in IRB 2018-09 and is available at www.opportunityzoneresourcecenter.com. 

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Enterprise Community Partners (Enterprise) and JPMorgan Chase (Chase) announced development plans Jan. 25 for the Greenpoint Manufacturing and Design Center (GMDC) Ozone Park Industrial Center in Queens, N.Y. The plan with GMDC will transform an 88,500-square-foot historic former bicycle factory into 25 rental units. There will be affordable workspaces for 25 small businesses, which will create 80 permanent jobs. Financing includes $10.5 million in new markets tax credit (NMTC) equity, with the NMTC allocation of $10 million from Enterprise, $17 million from the New York City Economic Development Corporation and $4 million from Chase Bank. In addition, Enterprise Community Loan Fund, a national community development financial institution (CDFI) and a subsidiary of Enterprise, will provide an $8.7 million loan with the participation of CDFIs Nonprofit Finance Fund and the Local Initiatives Support Corporation. The city will provide $3.7 million in subordinate debt financing, as well as a $10 million grant as part of Mayor Bill de Blasio’s Industrial Developer Fund. New York State agency Empire State Development awarded a $2.1 million grant. Construction is scheduled to be complete in early 2019.

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Cinnaire announced Jan. 8 a $9 million NMTC investment in the development of the Mott Community College Culinary Arts Facility in Flint, Mich. The NMTC investment will go toward Uptown Reinvestment Corporation and Mott Community College’s renovation of the former Woolworth Building. The facility will provide educational opportunities and revitalization. Chase is the NMTC investor. The facility will have two culinary arts teaching kitchens, two bakery teaching kitchens, a meat fabrication teaching laboratory, a fine dining space connected to a baked goods café and a large meeting space. The Charles Stewart Mott Foundation donated the Woolworth Building, as well as a $4 million grant.

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Northland Central held a workforce training ceremony Jan. 19 to celebrate the development of the Northland Workforce Training Center in Buffalo, N.Y. Building America, a wholly owned affiliate of the AFL-CIO Housing Investment Trust (HIT), announced a $9 million NMTC investment for the development of the 92,000-square-foot facility. The National Trust Community Investment Corporation announced a $5 million investment. The center will be used to train 300 workers each year for jobs in the modernized manufacturing sector. Approximately 93,000 square feet of the 240,000-square-foot building will be used for the training center. The center is expected to create an estimated 329 union construction jobs and 69 new positions, while retaining 124 permanent jobs in management, counseling, administration, faculty, building operations, maintenance and security. This project is part of New York Gov. Andrew Cuomo’s Buffalo Billion program, which commits $1 billion investment in the Buffalo area economy to create thousands of jobs and spur billions in new investment and economic activity over the next several years. 

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A financing package for the $10.3 million redevelopment of a former armory in Indianapolis was secured in mid-January. Plans to convert the 70,000-square-foot, 1938 former naval armory building into a second campus for Herron High School include $4 million in federal NMTC and historic tax credit equity. Additional financing includes $3 million in private contributions, $1.5 million in tax-increment financing funds and a $1.3 million grant from Indiana Landmarks. Students will be welcome in fall 2018. 

Journal Category:

New Markets Tax Credit

Authors:

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