Novogradac Journal of Tax Credits Volume 9 Issue 6
The June 2018 issue of the Novogradac Journal of Tax Credits. For more content, please subscribe to the Journal.
While rents in San Francisco rise and many local businesses are being pushed out of the city, PlaceMade is doing something.
A historic 41,000-square-foot car dealership in New Orleans that survived a fire and a hurricane is transforming into a new behavioral health care center.
Have you ever wondered why, during the lease-up of a property, it’s important to fully occupy a building before moving to occupy the next building? Or why it’s crucial to move in low-income households before the end of a month?
In the competitive market for new markets tax credit (NMTC) allocation authority, loan funds may provide an edge.
The Treasury Department has recommended that federal banking regulators significantly update how they implement the Community Reinvestment Act (CRA) to reflect sweeping industry changes and serve communities better. The next move is up to the three federal banking agencies.
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SunTrust Community Capital, together with YMCA of the Triangle and CAHEC New Markets, announced April 19 the closing of a deal to finance a $41 million recreation center and school in Raleigh, N.C. Financing included $21 million in new markets tax credit (NMTC) allocations, with $15 million in NMTCs provided by CAHEC New Markets and $6 million in NMTCs provided by SunTrust. The facility will house a 42,960-square-foot recreation center with a wellness center, gymnasium and group exercise studio. There will also be a 71,908-square-foot school building that will be operated by and leased to the Wake County Public School System. The YMCA center will bring 28 permanent jobs to the area, as well as 129 construction jobs. The facility is set to open August 2019.
The Colorado Department of Revenue issued Colorado Private Letter Ruling No. PLR-18-002 April 12. The PLR provides guidance on the state renewable energy investment tax credit (ITC). The PLR concluded that the taxpayer, an entity included in a combined report, can claim refundable enterprise zone renewable energy ITC refunds up to the refundable cap of $750,000 per year for as many years as needed to use the refundable amount. In addition, for investing in renewable energy sources in an enterprise zone, the taxpayer owns and operates all renewable energy investment assets of the project. Instead of claiming the ITC as a credit against income tax, the taxpayer may receive a cash refund equal to 80 percent of the tax credit. The balance of the refundable ITC may be carried forward each year, up to the yearly cap, until fully used.
As of mid-April, restoration of the former James Scott mansion in Detroit was almost complete. Initially built in the 1890s and later expanded, the 24,000-square-foot three-story building is undergoing a $6-million transformation into 26 apartments, with the help of $1.4 million in HTC equity.
The U.S. Department of Housing and Urban Development (HUD) issued a memo May 1 announcing new guidelines for closing a Rental Assistance Demonstration (RAD) transaction after the RAD conversion commitment (RCC) is made. The memo, by HUD Office of Recapitalization Director Tom Davis, says agencies undergoing RAD conversions have 90 days to close their transactions after receiving the RCC, unless granted an extension by HUD. HUD created a new delayed submission status for properties whose closing packages are not received by HUD two months after the RCC is issued. If there is no evidence the public housing agency is progressing to closing the transaction, the RCC may expire. The new delayed submission status began with RCCs issued May 1. The memo is available at www.hudresourcecenter.com.
The National Council of State Housing Agencies released April 6 its list of frequently asked questions on housing credit income averaging. Questions include what is income averaging, must a state allow income averaging for developments applying for credits (or seeking bond-financed credits) in 2018 and subsequent years, must a state modify its qualified allocation plan or related regulatory document(s) before allowing income averaging, must the Internal Revenue Service (IRS) issue guidance before states can allow income averaging, must IRS revise Form 8609 before states can allow income averaging and how does income averaging apply to tax-exempt bond-financed 4 percent credit deals? The FAQs are available at www.ncsha.org.