Expired Federal Tax Credit Program Helped Bridge Financing Gap for Center
ATLANTA, GA—The grand opening of the National Center on Civil and Human Rights took place in downtown Atlanta yesterday. More than seven years in the making, the grand opening signals the successful completion of a mission to “create a safe space for visitors to explore the fundamental rights of all human beings.” But it might not have been possible without the New Markets Tax Credit (NMTC), a federal tax credit that helps leverage private investment for development projects in economically distressed neighborhoods.
Among those in attendance for the ribbon cutting and grand opening festivities were New Markets Tax Credit (NMTC) Coalition members, Invest Atlanta and PNC Financial Services Group, which together provided $24 million in NMTC financing for the $79 million project. Atlanta Emerging Markets, Inc., Invest Atlanta’s Community Development Entity (CDE) provided $13 million NMTCs, and PNC Bank’s CDE, Development Ventures, provided $11 million in credits. PNC also served as the investor for the project.
The museum will commemorate the American Civil Rights Movement and the historic struggle for equality. It will also include exhibits on the modern Global Human Rights Movement. The ribbon cutting for the 43,000-square-foot facility was attended by icons of the civil rights movement, including Rep. John Lewis (D-Ga.), an original Freedom Rider. Senator Johnny Isakson (R-Ga.), Mayor Kasim Reed and former mayor Shirley Franklin also spoke at the grand opening event.
“The Center on Civil and Human Rights’ opening is a victory for the city, celebrating its rich history and the connection to today’s challenge —it is a remarkable project that has been in the making for the last decade,” said Dale Royal, NMTC Coalition Board Member and Senior Project Manager, Redevelopment & President, Atlanta Emerging Markets, Inc. “The center will be a destination, attracting people from across the United states, and around the world, and the New Markets Tax Credit financing was a critical piece in making it happen.”
The NMTC expired on December 31, 2013, and the future of this important financial tool is contingent upon congressional action. Reauthorization efforts for the NMTC, as well as other 54 other expired tax credits, stalled in the Senate last month due to procedural hurdles. In the House, the Committee on Ways and Means is in the process of reviewing individual provisions; the NMTC is expected to be taken under consideration. Meanwhile, bills to provide a permanent authorization for the NMTC have been introduced in the House and Senate, respectively the New Markets Tax Credit Extension Act of 2014 (H.R. 4365) and the New Markets Tax Credit Extension Act of 2013 (S. 1133).
A new report released by the Coalition earlier this month found that, in the last calendar year alone, survey respondents reported $4.9 billion in total project financing through the NMTC, which helped finance more than 250 businesses and create over 54,000 jobs in economically distressed communities. While all of these investments were made in qualified low income communities, the Coalition noted that 80 percent were made in severely distressed communities, with 56 percent made in areas with unemployment rates 1.5 times the national average.
“The New Markets Tax Credit has resulted in an unprecedented level of investment in communities left outside the economic mainstream,” said Bob Rapoza, spokesperson for the NMTC Coalition. “Moreover, the NMTC is often the only opportunity available for credit-starved, small and medium-sized businesses. We are hopeful the NMTC will be extended so that it can continue to be used to revitalize communities and provide financing for funding gaps in the completion of landmark projects like the National Center for Civil and Human Rights.”