New Markets Tax Credits News Briefs - December 2010

Wednesday, December 1, 2010

The Ohio Department of Development announced the first round results of the $10 million state new markets tax credit (NMTC) program. The program helps finance business investments by providing state tax credits to investors for below-market-rate financial products for low-income community businesses. The department says that its allocations to four community development entities (CDEs) will spur economic investments of at least $25.6 million across the state. Selected CDEs are Cincinnati Development Fund, receiving $2 million in tax credit authority for a minimum of $5.1 million in investments made in Cincinnati; Finance Fund, receiving $3 million in NMTC authority to make a minimum of $7.7 million in investments; Key Community Development New Markets LLC, to receive $3 million in authority to invest a minimum of $7.7 million around the state; and Northeast Ohio Development Fund, receiving $2 million in NMTC authority to make a minimum of $5.1 million in investments. Administered by the Urban Development Division, the program is modeled after the federal NMTC and provides a 39 percent tax credit over seven years for qualified investments.

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Kevin Boes was named president and CEO of the Local Initiatives Support Corporation (LISC) New Markets Support Corporation (NMSC). NMSC is LISC's NMTC investment arm and is managed by the National Equity Fund (NEF). Boes currently has direct reporting responsibility for the NMSC team as NEF's chief financial officer. He will assume his new role on January 1, 2011. In anticipation of the move, NEF named Alex Denja its new CEO, also effective on January 1. NEF said Boes will continue to work in the Chicago, Ill. office with the rest of the NMSC team and serve as a financial leadership resource for the organization.

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Enterprise Community Investment announced the grand opening of phase one of an expanded YWCA in Salt Lake City, Utah. Enterprise provided a $15 million NMTC allocation and Chase served as the equity investor. The first phase doubles the size of the YWCA's domestic violence shelter to 150 beds; another building offers 12 rooms to homeless women and their children for as many as two years per household. Women and children began moving into the new residences in October. Amenities include child-centered space, a prayer and meditation room, a café and a boutique. Ground-source heat pumps and energy-efficient lighting will be included in the structures, planned to meet silver LEED standards. An additional $17 million in funding came from private donations and public support.

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The Urban Development Fund, an affiliate of Aries Capital, provided $17.5 million in NMTC financing to facilitate the redevelopment of the St. Louis Centre in St. Louis, Mo. Beginning this year, the 540,000-square-foot former shopping mall will undergo a $35 million redevelopment. The now-vacant building was the largest urban shopping mall in the country at the time it was constructed, in 1987. Renovation plans include 60,000 square feet of first floor retail space, a movie theater and banquet hall on the second floor, and a 750-space parking garage on the structure's two remaining floors.

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Cathy Dolan joined Opportunity Finance Network as its chief operating officer. Her responsibilities include running the organization's operations, as well as business development, executive management and public representation of ONF, a national network of community development financial institutions (CDFIs). Dolan will work with OFN's president and CEO to ensure alignment of business execution with external conditions and lead a staff of 30. Prior to joining OFN, she was Wells Fargo's senior vice president and director of community lending and investment for the Eastern U.S. During her time there, she led the NMTC group from its inception at Wachovia to present-day Wells Fargo, where the team receives and deploys NMTC allocations. Dolan holds a master's degree from Johns Hopkins University.

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SolarVision announced that it closed a $5.6 million deal for five solar system installations in Ohio in conjunction with finance partners Stonehenge Structured Finance, Finance Fund and First Merit Bank. Finance Fund provided $5.6 million in NMTCs to seal the transaction with First Merit Bank. The projects include an already completed 65 kilowatt (kW) solar array on Evening Street Elementary School in Worthington, Ohio; a 220 kW solar roofed carport in the Athens (Ohio) Community Center parking lot; a 68 kW solar array for Newcomerstown (Ohio) West Elementary School; a 128 kW solar array for Newcomerstown High School; and a 249 kW solar array for a water treatment plant in Washington Court House, Ohio. Through power purchase agreements with each entity that hosts the projects, SolarVision will use the renewable energy tax credits they generate to provide cost savings to hosts. The company said the agreements also allow it to buy the solar systems with investors who can take advantage of Ohio Advanced Energy Fund tax credits. SolarVision expects all five to be completed before the end of the year.

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