FOR IMMEDIATE RELEASE: June 24, 2008
City development entity dispenses tax credits for low-income areas
Partnership with Central Bank seeks to generate jobs and economic development
The City of Kansas City, Mo., Community Development Entity (KC CDE) is helping direct new markets tax credits to catalytic projects that benefit low-income residents and communities in Kansas City, Mo. The development entity includes representatives from low-income communities and City staff, and is responsible for proposing and reviewing projects for new markets tax credit investments.
“New markets tax credits are an important addition to the City’s available tools to address issues of economic development in distressed neighborhoods,” said City Manager Wayne A. Cauthen. “The tax credits will be allocated through an established framework of neighborhood-based plans that identify specific needs and viable revitalization efforts.”
The KC CDE partnered with Central Bank of Kansas City in October 2007 to apply for a $50 million allocation of new markets tax credits. The $50 million award is expected to produce a net amount of approximately $15 million of subsidy for businesses in distressed census tracts.
The KC CDE and Central Bank continue to work to pursue additional new markets tax credits for the development of mixed-use, business, community center and housing projects in the city’s low-income communities.
“Coming off of my new tools for economic development symposium, I am happy to see City staff pursue new programs and resources that will specifically promote economic development in the neglected parts of our city,” said Mayor Mark Funkhouser.
On March 5, the KC CDE submitted an application requesting $95 million in new markets tax credit allocation authority from the Community Development Financial Institutions Fund of the U.S. Treasury Department. Organizations requesting awards under the federal New Markets Tax Credit Program must be certified as a Community Development Entity by the Community Development Financial Institutions Fund of the U.S. Department of the Treasury.
If the $95 million is awarded, it will be targeted at projects that meet several of the following criteria: create living-wage, quality jobs and use workforce development support; demonstrate commitment to working collaboratively with regulatory agencies, community support organizations and affected neighborhoods to optimize benefits to the low income community; qualify as minority/women owned businesses enterprises, or demonstrate commitment to using minority and women business enterprises-contractors; demonstrate commitment to environmental remediation and Leadership in Energy Efficient Design standards; and demonstrate local ownership by low-income persons or residents of low-income communities. The $95 million allocation award outcome will be determinedin October.
The new markets tax credit program aligns with the City’s redevelopment goals to provide investment capital to low-income communities and incent redevelopment efforts in highly distressed neighborhoods.
New markets tax credit information is available at http://www.kcmo.org/finance.nsf/web/newmarket.
Media inquiries and more information are available by calling Carrie Vanderford, project analyst for the City’s Finance Department at (816) 513-2833.