New Markets Tax Credit News Briefs – November 2018

Thursday, November 8, 2018

Correction: A brief in September’s Novogradac Journal of Tax Credits incorrectly described the status of the Moloka’i New Energy Partners project in Hawaii. Construction has not commenced nor has Punawai ‘O Pu’uhonua provided any new markets tax credit (NMTC) allocation to the project yet. We regret the error.

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The Alabama Court of Civil Appeals Sept. 14 overturned a trial court decision and ruled that the state’s NMTC can reduce the financial institutions excise tax (FIET) only by the amount paid to the state. The ruling said the NMTC can’t reduce FIET proceeds paid to counties and municipalities in which the financial institution was located. The decision in Alabama Dept. of Revenue vs. Bryant Bank, Ala., overturns an earlier decision that authorized a credit only against the amount paid to counties and municipalities and not to the state. The ruling is available at www.newmarketscredits.com. 

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Rep. Jenniffer Gonzalez-Colon, R-Puerto Rico, introduced legislation Sept. 12 to provide a federal tax credit for certain business expenses in census tracts that meet one of three definitions for an economically distressed zone and are designated as such by local or state government. H.R. 6785 would provide a 40 percent credit for wages and benefits paid in an economically distressed zone, a 40 percent credit of the depreciation and amortization allowances for the property in an economically distressed zone or a 30 percent credit for payments made for purchases of services or tangible property from an unrelated person located in an economically distressed zone. The bill is available at www.newmarketscredits.com. 

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The Community Development Financial Institutions (CDFI) Fund announced Sept. 21 an updated application for its community development entity certification. The application is available through the CDFI Fund’s Awards Management Information System. There are no changes to the criteria and questions on the previous application form.

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The CDFI Fund announced $150 million in CDFI Bond Guarantee program funding Sept. 18. The guarantee was issued to the Community Reinvestment Fund, USA on behalf of Clearinghouse Community Development Financial Institution, which is headquartered in Lake Forest, Calif. 

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Providence Public Library announced Sept. 13 $4.2 million in NMTC equity and $1.6 million in C-PACE financing for the $25 million renovation of the Providence Public Library, in Providence, R.I. Funding will address required life safety systems upgrades while making major infrastructure improvements to downtown buildings. The 83,000-square foot project will transform the library’s 1950s wing, auditorium and special collection areas to provide 21st-century library services.
 

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