Urban Futures, Inc. (UFI) is currently working on a joint project between the City of Lake Elsinore and developers to build a health, community and athletics facility that will benefit the region.
The City sought UFI’s assistance with federally-available New Markets Tax Credits (NMTCs) to meet a financing gap for the estimated $80 million project. With the NMTC allocation, the City would be able to work with a real estate developer to provide the City a facility, the construction and operations for which will provide the region with over 900 construction jobs, approximately 750 permanent jobs, and significant economic development.
NMTCs were authorized under the Community Renewal and Tax Relief Act of 2000 with the intent to create jobs and provide material improvement in the lives of residents in distressed census tracts. This is done by creating or spurring new or increased investment into operating businesses and real estate projects located in low-income communities.
Funds are allocated to community development entities (CDEs), which then disburse funds to qualifying projects. Public agencies and their partners can team up to fill in financing gaps by leveraging this below-market source of financing.
UFI will be active with NMTC investors and CDEs at the upcoming NMTC conference in San Diego, marketing the Lake Elsinore project and building on our understanding of the individual investment footprint for each investor. Investors have their own individual investment criteria; for example, one may invest only in public projects, while another may invest only in community health centers with direct benefits.
Although allocations are expected to be announced this spring, it is most appropriate for agencies interested in including NMTCs as part of their project profiles to develop project marketing materials such as pro formas and executive summaries as soon as possible to take advantage of the 2015 allocation.
For further information on NMTCs and options for individual projects, contact our team.
Michael Busch at (714) 283-9334 or MichaelB@UrbanFuturesInc.com
James Lee at (714) 923-3565 or JamesL@UrbanFuturesInc.com
Urban Futures, Inc. has been providing services to local governmental agencies for over 42 years. Recently restructured into three divisions – UFI Public Management Group, UFI Public Finance Group and Isom Advisors – UFI offers clients a growing portfolio of services and industry expertise that might otherwise be out of reach. Over 300 public agencies have benefited from partnering with UFI. UFI is based in Orange, CA with offices in Walnut Creek and Bakersfield. Visit their website at www.urbanfuturesinc.com or call us at (714) 283-9334.