with HTCs Jerry Breed , Bryan Cave, Washington, DC Mary Thompson , - PowerPoint PPT Presentation

Strategies for Combining NMTCs with HTCs Jerry Breed , Bryan Cave, Washington, DC Mary Thompson , Bank of America Merrill Lynch, Boston, MA

Waterfire Providence • Founded in 1997, WaterFire Providence is an independent, non-profit arts organization whose mission is to inspire Providence and its visitors by revitalizing the urban experience, fostering community engagement and creatively transforming the city by presenting WaterFire for all to enjoy. • WaterFire Providence is redeveloping a vacant 35,000 SF warehouse building in the Olneyville neighborhood of Providence, RI. • The site is a brownfield industrial site on the National Historic Register. • The project will enable WaterFire Providence to consolidate all its operations and personnel (which are currently sited at six locations throughout the city) into one building. • And also provide public gallery space for performances and exhibitions, establish youth development programs in arts education including boatbuilding, and host an International Center for Excellence for Creative Placemaking to include a public art incubator and learning lab.

Waterfire Pictures

Waterfire Arts Center

Proposed Twinned Structure

Benefit of twinning Tax Credit Calculation Twinned NMTC-LISC NMTC-BOA NMTC-LISC TOTAL CDE1 CDE2 QEI/ Allocation 2,856,000 5,000,000 2,144,000 10,000,000 Percentage 0.39% 0.39% 0.39% 0.39% Calculated Tax Credits 1,113,840 1,950,000 836,160 3,900,000 Percentage to Investor 100% 100% 100% 100% Credits to Investor 1,113,840 1,950,000 836,160 3,900,000 Price / Credit 0.86 0.86 0.86 0.86 NMTC Equity 957,902.4 1,677,000 719,097.6 3,354,000 FHTC Equity 1,424,902.4 1,424,902.4 Investor Equity 957,902.4 1,677,000 2,144,000 4,778,902.4 Sponsor Loan 1,898,097.6 3,323,000 0 5,221,097.6

Considerations • Revenue Procedure • Additional CDE • CDE makes equity Investment • Costs/Expenses • HTC considerations – Economics – Exit • Forgive loan • Put interest to an affiliate of developer • Liquating CDE

Issues • NMTC considerations – 12 month deployment – Reinvestment • HTC considerations – Adjuster payment made to CDE • CDE equity interest – Redemption Risk