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New Markets Tax Credits News Briefs - September 2012

U.S. Bank celebrated the grand opening of the Union Gospel Mission (UGM) Center for Women and Children in Coeur D’Alene, Idaho. The bank provided more than $2.7 million in new markets tax credit (NMTC) equity in support of the new development and made a $145,000 donation to support its operations. The center is a 46,000-square-foot supportive housing facility that includes 35 units of transitional housing for rescue and recovery guests. The new space allows UGM to serve as many as 85 women and children in Kootenai County and offer supportive services that include work therapy, employment classes and counseling, GED completion, case management, drug and alcohol counseling, and child care. U.S. Bank’s community development subsidiary, U.S. Bancorp Community Development Corporation (USBCDC), structured the center’s NMTC financing in partnership with CCG Community Partners. The center has created more than 100 construction jobs and 14 permanent jobs.

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The Reinvestment Fund (TRF) supplied $20 million in NMTC financing for two major education projects in Baltimore, Md. The Maryland Institute College of Art’s (MICA’s) Studio Center, which houses graduate programs, is located in a repurposed 100-year-old former garment factory in the Station North area. The renovation will support MICA’s plan to expand its graduate programs by adding studio and gallery space, an auditorium and a café. The Henderson-Hopkins School, formerly the East Baltimore Community School, will serve kindergarten through eighth grade students in a new 90,000-square-foot building and 175 students in the new Harry and Jeanette Weinberg Early Childhood Center. The campus is the cornerstone of a major redevelopment effort by East Baltimore Development Inc. to revitalize 88 acres adjacent to the Johns Hopkins Hospital and create a mixed-use community. Both projects are expected to generate more than 200 jobs and serve more than 700 students.

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McCormack Baron Salazar and the Los Angeles County Metropolitan Transportation Authority celebrated the grand opening of the first phase of MacArthur Park Apartments in Los Angeles, Calif. The first phase of the project includes 90 affordable housing units, 15,000 square feet of retail, 100 parking spaces and bicycle parking. A total of 172 affordable housing units are planned for the two-phase development, which is located adjacent to a Metro station and one mile from downtown. The community is designed to serve as a model for other transit-oriented developments and to act as a catalyst for further development in the MacArthur Park neighborhood. The $44.8 million development was funded in part by Tax Credit Assistance Program funds; an NMTC allocation from MBS Urban Initiatives; and equity and debt provided by Goldman Sachs Urban Investment Group through the sale of low-income housing tax credits and NMTCs. Other financing sources include Bank of America, the California Department of Housing and Community Development, the Los Angeles Housing Department, Metro and the Community Redevelopment Agency of the City of Los Angeles. Construction of the development’s second phase is slated to begin in 2013.

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Waveland Community Development (WCD) allocated $24 million in NMTCs to help finance the construction of Sandy Grove Middle School in Hoke County, North Carolina. The county is the most impoverished county in the state. The financing will enable the construction of a 75,000-square-foot, net-zero energy consumption school building for the Hoke County School System. The facility will feature a geothermal heating and cooling system, a solar photovoltaic system, high-efficiency lighting, spray foam insulation, added roof insulation, and a whole building generator. The renewable energy systems are expected to generate 30 percent more energy than the school will consume, allowing the school to sell the excess energy to a utility company while eliminating future power costs. Sandy Grove Middle School’s financing includes Qualified School Construction Bonds as leverage debt. USBCDC participated as the NMTC equity investor and United Fund Advisors acted as project manager.

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BizCapital, Advantage Capital Partners’ small business lending division, provided $3 million to Kentucky Chrome Works (KCW), a manufacturer of luxury alloy wheels. KCW is also the exclusive chrome plate supplier for the Corvette. The funds, raised in connection with the Kentucky New Markets Development Program, will be used to expand the company’s capabilities and provide working capital. The expansion will also allow the company to hire 20 new employees.

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The Internal Revenue Service (IRS) released Notice 2012-48 soliciting applications for an allocation of available Tribal Economic Development Bond volume cap. The available amount includes amounts that were previously allocated and subsequently forfeited under Notice 2009-51, Announcement 2010-88 and Announcement 2011-71. The notice also provides guidance on the application requirements and the administration of the allocation process. A copy of Notice 2012-48 is available on the Tax Exempt Bond Community page of the IRS website at www.irs.gov.

Journal Category:

New Markets Tax Credit

Authors:

Novogradac

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