NMTC financing helped Pueblo of Laguna Utility Authority complete the rehabilitation of the water and wastewater system throughout the tribal lands of Pueblo of Laguna, N.M. The previous water system, which supported six villages, suffered from recurring system failures. The 4Points Laguna project promises to enhance the water and waste water systems by providing 60 percent more capacity, as well as safety measures that would allow for an appropriate fire protection system throughout the pueblo. The first phase of this project received $23 million in NMTCs from the New Mexico Finance Authority. The project has created 20 full-time jobs, a majority of which are filled by Native American and low-income employees.
The project is a first-in-nation renewable energy operating business that uses Sierra Nevada forest waste as its feedstock to produce electricity. The electricity will be used in an adjacent industrial park (a former Brownfield site) that focuses on the manufacturing of forest-originated products. The utilization of this forest waste is an imperative for the State and USDA to reduce fire hazard in the Sierras. In 2015 Governor Jerry Brown issued an emergency proclamation that specifically called for the development of forest waste-to-fuel plants as a specific strategy in his initiatives for healthy forests. This is a project that truly meets the ‘but-for’ test. The $7.5 million in capital cost is funded primarily through a California Energy Commission grant of $5 million and in-kind cash and material contributions of $1.3 million. Due to the startup nature of the business, limited balance sheet, new technology, special equipment and remote location, debt financing was not available and equity financing was prohibitively expensive. In fact, a public finance consulting firm utilized by the developer was unable to raise the gap financing through any of its own channels, including USDA B&I programs, tax-exempting bonding, etc. new markets filled the gap perfectly. A $6 million NMTC allocation produced a $1.2 million benefit and subsequent to closing, the project was able to break ground.