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New Markets Tax Credits News Briefs - February 2012

Federal bank regulatory agencies announced the annual adjustment to the asset-size thresholds used to define small bank, small savings association, intermediate small bank, and intermediate small savings association required by the Community Reinvestment Act (CRA). Effective January 1, "small bank" or "small savings association" means an institution that had assets of less than $1.16 billion as of December 31 in either of the prior two calendar years. "Intermediate small bank" or "intermediate small savings association" means a small institution with assets of at least $290 million as of December 31 of both of the prior two calendar years, and less than $1.16 billion as of December 31 of either of the prior two calendar years. Financial institutions are evaluated under different CRA examinations procedures based on their asset-size classification. Those meeting the small and intermediate small asset-size threshold are not subjected to the reporting requirements applicable to large banks. The annual adjustment is based on the annual percentage change in the Consumer Price Index. Read the December 22 Federal Register notice for more details. A list of current and historical asset-size thresholds is available at


National Trust Community Investment Corporation (NTCIC) allocated $6 million in new markets tax credit (NMTC) financing for the rehabilitation of the Hibernia Bank Building in New Orleans, La. The Hibernia Building, the city's first modern skyscraper, formerly served as the Hibernia National Bank headquarters. Developers HRI Properties and Woodward Interests are converting the building into 175 mixed-income apartments and 41,500 square feet of retail and office space. Financing sources include $11.3 million in federal historic tax credit (HTC) equity from AEGON USA, a $5 million NMTC loan from Capital One Community Renewal Fund and $8.5 million in state HTC equity from Stonehenge Capital. NTCIC said the rehabilitation of this property, which is surrounded by vacant buildings, will help stop the spread of blight in the neighborhood and incentivize other property owners to invest in nearby buildings. The project is expected to create 461 construction jobs and 531 permanent jobs, as well as generate more than $26.4 million in household and business income along with $35.3 million in gross state product.


Community Development Financial Institutions (CDFI) Fund Director Donna J. Gambrell was honored at the New York Housing Conference and National Housing Conference 38th Annual Awards Program in New York City. One of four honorees recognized for their contributions to affordable housing, Gambrell received the Public Service Award for exemplary leadership and for the CDFI Fund's accomplishments in increasing economic opportunity and promoting community development investments for underserved populations and distressed communities. Past recipients of the Public Service Award include U.S. Department of Housing and Urban Development (HUD) Secretary Shaun Donovan and New York City Mayor Michael Bloomberg.


Madison Children's Museum (MCM) in downtown Madison, Wis. used $6 million in NMTC financing to refinance its construction debt. The $16.5 million project to construct the museum was funded with a $5 million donation, $10 million in capital campaign contributions, and a $1.5 million loan. Because capital campaign pledges are paid off over time, MCM took out another loan to cover renovation and exhibit costs, and will repay that loan with NMTC equity provided by U.S. Bank. Permanent financing through the NMTC structure came from Park Bank; Johnson Community Development Corporation allocated the credits and Forward Community Investments assisted the museum in structuring the transaction. By reducing its annual debt service, the museum, which is anticipated to be Wisconsin's first LEED-certified museum, will be able to free up cash flow for its operations and programming. MCM said it pumps more than $3 million annually into the local economy through wages and procurement of services and supplies. During the building's construction, the project created more than 130 jobs.


Third Coast Commercial Real Estate announced the close of NMTC financing for a recycling facility in Hamtramck, Mich. The facility, which financial advisor Third Coast helped qualify for credits through the NMTC program's targeted populations provision, is expected to enhance sustainability efforts throughout the Detroit metropolitan area, add economic stability in a distressed community and employ persons from low- and moderate-income households.


A partially completed mental health campus in Burien, Wash. received a significant boost when it closed on a $23 million financing transaction involving NMTCs. The additional financing will enable Navos, a not-for-profit community mental health agency, to complete the build-out of its three-story 45,000 square foot outpatient mental health clinic and construct an adjacent 8,000 square foot community activities building for operation of a café, supported employment program and other program services. The new facilities replace an existing facility that must relocate due to the third runway project at SeaTac airport. The project is expected to generate 150 full-time construction jobs in the south Puget Sound region as well as retain 175 existing full-time jobs from the relocated operations. Navos expects to expand its capacity to provide critical health and mental health care services by 20 percent in the new location. To structure the tax credit financing, Navos and its development consultant, Common Ground, collaborated with King County Housing Authority (KCHA), National Development Council (NDC), WNC & Associates of Irvine, Calif. and U.S. Bank, which provided both debt and tax credit equity. Navos had previously completed the shell and core of the clinic as well as tenant improvements to the first floor, which is now occupied. Completion of the remaining work is expected by fall 2012. The project's architect is DKA Architecture. JR Abbott is the general contractor.

Journal Category:

New Markets Tax Credit



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