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New Markets Tax Credit News Briefs – May 2018

New regulations for the Maine state New Markets Tax Credit (NMTC) program, enacted March 18, will disqualify as qualified low-income community investments (QLICIs) any investment made after Nov. 9, 2015, that includes more than 5 percent of the investment for any of several uses. QLICI uses that can’t exceed the 5 percent level include refinancing costs, expenses or investments incurred or paid by the qualified active low-income community business (QALICB) or a party related to it before the date of the QLICI; equity distributions from the QALICB to its owners; investments to acquire an existing business or enterprise in the state; or transaction fees. The change will go into effect 90 days after the end of this year’s second legislative session, which is scheduled to end April 18. The bill is available at www.newmarketscredits.com.

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CEI Capital Management LLC announced March 12 $20 million in NMTC equity for the construction of a new processing plant in Starbuck, Wash., for Columbia Pulp I LLC, a next-generation pulp mill. Columbia Pulp I LLC turns waste straw into pulp for papermaking. The new 290,000-square-foot facility will allow the pulp mill to convert low-cost waste agricultural wheat and alfalfa straw supplied by farmers in the area into pulp for papermaking at regional and national paper mills. There will be approximately 120 constructions jobs and 87 permanent jobs. Columbia Pulp I LLC also received $133.6 senior bond financing from the Washington Economic Development Finance Authority. Construction is expected to cost $184 million. 

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Capital One Bank provided $22.8 million in NMTC equity March 13 for the construction of KIPP Charter School in New Orleans. The 98,595-square-foot school will consolidate two campuses and host 950 students from kindergarten through eighth grade. The Low Income Investment Fund provided a $12.3 million NMTC allocation and partnered with Capital One Partners for the Common Good for a total of $22.8 in NMTC allocations. Construction is expected to be complete in August.

Journal Category:

New Markets Tax Credit

Authors:

Novogradac

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