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New Markets Tax Credits News Briefs - May 2016

The Community Development Financial Institutions (CDFI) Fund on March 10 released an updated frequently asked questions (FAQ) document for fiscal year (FY) 2016 applicants of the Capital Magnet Fund. Updated topics include affordability requirements, using the Capital Magnet Fund with other CDFI Fund programs, providing Capital Magnet Fund funds to limited liability corporations or limited partnerships and other topics. The updated FAQ is available at www.newmarketscredits.com.

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Annie Donovan, director of the CDFI Fund, gave a keynote address March 9 at the 2016 CDFI Coalition Institute. She announced the release of the CDFI Fund’s 2015 Year in Review, “A Year of Engagement and Action for the Future.” She also reported that the industry continues to grow. The number of certified CDFIs stands at 991, which is 74 more than at the end of fiscal year 2014. The CDFI Fund awarded $3.5 billion in tax credit allocation authority to 76 organizations. The organization has completed 12 allocation rounds since 2002 and has made 912 awards totaling $43.5 billion in tax credit allocation authority. In fiscal year 2015, the CDFI Fund closed on three bond transactions totaling $327 million through the CDFI Bond Guarantee Program. Donovan also mentioned a strategic plan, and discussed the five principals of the framework. Donovan closed her address by saying that the challenge the organization faces in 2016 and beyond is to keep moving forward.

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The National New Markets Fund LLC announced March 21 the closing of a $21 million NMTC allocation for the Commercial Metals Company (CMC). The allocation will allow the company to build an environmentally sustainable steel manufacturing facility in Durant, Okla. Additional funding include came from Rural Enterprises of Oklahoma, Inc., Midwest Renewable Capital and U.S. Bank. U.S. Bancorp Community Development Corporation (USBCDC), a subsidiary of U.S. Bank, served as tax credit investor. The new mill will support 300 jobs in a severely distressed census tract and the site is located within a multicounty area designated as a federal Promise Zone for the Choctaw Nation. CMC anticipates that the new micro mill facility will reduce carbon dioxide emissions by at least 58 percent compared to a traditional iron ore based steel plant. Completion is slated for late 2017.

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U.S. Bank announced March 15 a $2.3 million investment in the development of Plaza Mariachi, a business center in Nashville, Tenn. The business center is expected to create 216 jobs, 70 percent of which will be filled by low-income applicants. An existing 130 positions will be retained.

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Greenville New Markets Opportunity II allocated $9 million in NMTCs March 4 to Limehouse Produce in Charleston, S.C., for the rehabilitation of an abandoned building, which will be converted into food hub with additional tenant space for locally owned businesses and nonprofits at reduced rental rates. The allocation will also allow for the construction of a new produce distribution and cold storage facility that is expected to support 145 jobs and establish an apprenticeship program with Apprenticeship Carolina and Trident Technical College. Limehouse Produce provides conventional row crops, local specialties, fresh herbs and dairy products to Charleston-area restaurants. Greenville New Markets Opportunity II is a community development entity managed by Tax Advantage Group LLC and Greenville Local Development Corporation.

Journal Category:

New Markets Tax Credit

Authors:

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