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Novogradac Journal of Tax Credits Volume 7 Issue 9

The September 2016 issue of the Novogradac Journal of Tax Credits.

Journal cover September 2016


Mark O’Meara

Friday, September 9, 2016

One of Wheeling, W.Va.’s, most recognizable buildings, the Boury warehouse, is in the middle of a unique transformation. Since 1850, the building housed a grocery store, a storage facility and a warehouse that was used by various companies. After its latest overhaul by The Woda Group, the building will soon feature 63 apartments–both market-rate and affordable–while also featuring 14,470 square feet of commercial space to house the Wheeling Nailers, an East Coast Hockey League affiliate of the Pittsburgh Penguins NHL team. The development is called Boury Lofts. 

Brad Stanhope

Thursday, September 8, 2016

Coopermill Manor, the flagship property of the housing authority in Zanesville, Ohio, is getting a significant facelift, making the World War II-era complex a model for the U.S. Department of Housing and Urban Development’s (HUD’s) Rental Assistance Demonstration (RAD) program.

Andrew Spofford

Wednesday, September 7, 2016

Massachusetts Gov. Charlie Baker signed comprehensive economic development legislation  into law on Aug. 10 that includes a proposal advanced by Boston nonprofit Preservation of Affordable Housing (POAH) and a coalition of housing advocates for a donation tax credit to encourage more affordable housing in that state.

Forrest D. Milder

Tuesday, September 6, 2016

A popular structure for renewable energy investment tax credit (ITC) transactions is the two-tier lease-pass-through (or inverted lease). You’ll remember that in a pass-through transaction, the facility is owned by the landlord and leased to a tenant which operates the facility, collects revenue and pays rent to the landlord. Pursuant to a lease-pass-through election, the landlord “passes” the renewable energy tax credits to the tenant, while keeping the depreciation deductions associated with owning the facility. 

Jerome A. Breed

Friday, September 2, 2016

Even after the Internal Revenue Service (IRS) issued Revenue Procedure 2014-12, the historic tax credit (HTC) community remained uncertain about the treatment of Internal Revenue Code (IRC) Section 50(d) income and its effect on pricing HTC investments. While 50(d) income appears at first blush to be a technical tax concept, it has an enormous effect on the investor’s yield from HTC investments.

News Briefs

Friday, September 9, 2016

Sen. Martin Heinrich, D-N.M., introduced the Energy Storage Tax Incentive and Deployment Act of 2016 (S. 3159) July 12. The bill would create a 30 percent investment tax credit (ITC) for energy storage devices. The bill would apply to both large, grid-connected energy storage systems and smaller systems for residential properties. Systems would be eligible for the same 30 percent ITC that other renewable energy technologies receive. Systems would also face the gradual phase-down starting in 2019 that was part of the ITC extension that was passed at the end of 2015. The tax credit would be in effect for property placed in service starting at the beginning of this year. The bill would also expand Section 25D of the Internal Revenue Code to create a 30 percent ITC for residential energy storage equipment. Under this bill, no credits would be issued after Dec. 31, 2026. At press time, S. 3159 had been sent to the Senate Finance Committee. The text of the bill is available at

Friday, September 9, 2016

The Community Development Financial Institutions (CDFI) Fund invited public comment July 29 regarding the New Markets Tax Credit Program Allocation Tracking System. The CDFI Fund requires each allocatee to use the electronic data collection and submission system to report on the information related to its receipt of a qualified equity investment (QEI). No changes are being proposed at this time. Comments are due by Sept. 27. 

Thursday, September 8, 2016

The rehabilitation of the former Lexington, Ky., Courthouse began in late June. The building will be transformed into a commercial center with $9 million in state and federal historic tax credits (HTCs), as well as a $22 million bond approved by the Lexington City Council. Plans for revitalization include a first-floor tasting room for Kentucky bourbon and a second location for local chef Ouita Michel’s farm-to-table Windy Corner restaurant. The building’s third floor will be transformed into event space with seating capacity of about 300. Function rooms on the east and west side will connect by a central hallway. The event space is scheduled to be finished by the end of 2017, with construction of tenant space scheduled for the first quarter of 2018. The entire development is slated for completion in spring 2018.

Wednesday, September 7, 2016

The U.S. Department of Housing and Urban Development (HUD) released a proposed rule July 6 for the Housing Choice Voucher (HCV) program’s new administrative fee formula. The rule proposes a new methodology for determining the amount of funding a public housing agency (PHA) will receive for administering the HCV program. HUD also proposes to adopt the recommended formula with modifications based largely on comments received in response to a June 26, 2015, notice that solicited comment on the study. The rule proposes an ongoing administrative fee for a PHA that would be calculated based on program size, wage rates, benefit load, percentage of households with earned income, new admissions rate and percentage of assisted households that live a significant distance from the PHA’s headquarters. Comments are due Oct. 4.

Tuesday, September 6, 2016

The U.S. Department of Housing and Urban Development (HUD) released an update July 29 for the final fiscal year (FY) 2016 fair market rents (FMRs). Updates were included for the FY 2016 FMRs for Maui County and Kauai County, Hawaii. The revised FY 2016 FMRs for these areas reflect the estimated 40th percentile rent for April 2016. The updated FMRs were effective upon release of the notice. 

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