New Markets Tax Credits News Briefs - December 2012

Saturday, December 1, 2012

The Community Development Commission (CDC) of the County of Los Angeles announced the official dedication of the $77 million YWCA Job Corps Urban Campus, which was completed in downtown Los Angeles’ South Park community in April. The Job Corps program provides education, job training, job placement and housing for 16- to 24-year-olds. The new seven-story, mixed-use campus will include administrative space and 200 housing units for up to 400 residents. Shared amenities include a commercial kitchen and dining hall, a library, a resident lounge, a computer room, classrooms, study rooms and a medical and dental clinic. Units will be available to individuals earning 50 percent or less of the area median income (AMI), with 22 units funded by the City of Industry (COI) targeting individuals earning no more than 40 percent of the AMI. Job Corps participants live rent-free, but must participate in the program to reside at the campus. The CDC provided $2 million in COI funds for construction and permanent financing of the residential housing portion.

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Habitat for Humanity Central Arizona (HFHCAZ) will use more than $1.8 million in new markets tax credits (NMTCs) contributed by investor CEI Capital Management LLC of Portland, Maine to build 15 homes across the Greater Phoenix-Metropolitan Area. Families contribute 400 sweat equity hours before purchasing their HFHCAZ homes, with each home ranging from approximately 1,300 to 1,600 square feet. These housing developments by HFHCAZ, combined with those of 10 Habitat affiliates in Arizona, California, Florida, North Carolina, Ohio, Oregon, Tennessee, Texas and Wisconsin, total 239 homes around the nation using $22 million of NMTCs. More than $6.5 million of the NMTC equity came from U.S. Bank, CEI Capital Management LLC, Smith NMTC Associates LLC, plus sponsorship dollars from Habitat affiliates and donors.

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The Community Development Financial Institutions (CDFI) Fund released on Oct. 17 an update to its NMTC low-income community eligibility data, originally released May 1 of this year. Changes and clarifications were made to the 2012 census tracts from the U.S. Census Bureau’s 2006-2010 American Community Survey (ACS). Changes were also made to the NMTC census data transition frequently asked questions (FAQs). This data can be used by community development entities (CDEs) to determine if qualified low-income community investments (QLICIs) are located in 2010 census tracts eligible for NMTC. Updates to the list of FAQs include information on the relationship between the 2000 census and the 2006-2010 ACS data. As a concession to CDEs that may have already begun structuring potential QLICIs based on the 2000 census data, the CDFI Fund will allow current NMTC allocatees to use either the 2000 census data or 2006-2010 ACS data for qualifying QLICIs closed between May 1, 2012 and June 30, 2013. Access the reports at www.newmarketscredits.com.

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The Local Initiatives Support Corporation (LISC) will refinance an outstanding loan for Phoenix-based Specialized Services Company, allowing the family-owned underground utility contractor to expand its operation and add jobs. The LISC fund is capitalized by Morgan Stanley and combines NMTC with small business administration loans to support small business in communities where commercial investments are lacking. The $450,000 refinancing package for Specialized Services is capitalized by Morgan Stanley and reduces the company’s interest rate, making it possible to expand the firm’s 28-person staff by as much as 25 percent.

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Commonwealth Dairy in Brattleboro, Vt. announced a $12 million investment in new facilities and equipment for its plant, which opened in March 2011. The plant’s current production output includes more than 100,000 cases of packaged yogurt per week. The expansion project will add 23,000 square feet to the facility, including a new processing line, warehouse space, a new filling machine, fermentation tanks, wastewater treatment improvements, and new whey processing and packaging equipment. Extra office space will be part of the expansion as well. Expected to be completed by April 2013, the project will add as many as 34 jobs to its existing staff of 110.

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