Six redevelopment projects — including the Electric Works in downtown Fort Wayne — will get a share of Fort Wayne's $55 million New Markets Tax Credits allocation authority.
And this year, for the first time, the city's tax credit awardees include a project outside of Allen County.
Projects slated to receive tax-credit funding are:
• Electric Works, $12 million to assist in $221 million redevelopment of General Electric's campus on the west side of Broadway.
• Byron Health Center, $12.5 million to help relocate from Lima Road to the corner of Beacon Street and Lake Avenue.
• Fort Wayne Boys & Girls Clubs, $8 million to assist with the new 2.3 acre campus and building currently under construction.
• Vestil Manufacturing, Angola, $8 million to help build a new 225,000 square-foot fulfillment center in the area.
• The Landing, $4.5 million to help in the restoration of seven buildings and the construction of one new building on West Columbia Street. The project includes 70 apartments and 56,000 square feet of commercial and retail space.
“I’m pleased the Fort Wayne New Markets Revitalization Fund is able to help fill financing gaps in such important projects,” Henry said in the announcement of the tax credits awards May 24. “By working together, we are helping create jobs and provide opportunities for residents to succeed throughout northeast Indiana.”
The federal tax credits are offered through the Fort Wayne New Markets Revitalization Fund, a subsidiary company formed by the city of Fort Wayne. It is a certified Community Development Entity eligible to apply for New Markets Tax Credits from the U.S. Treasury. In February, the Fort Wayne fund was awarded $55 million in New Markets Tax Credits allocation authority.
Of the 230 community development entities that applied for new-markets funding, only 73, or 32 percent, won an allocation in that funding round.
The New Markets program was enacted by Congress in 2000. It allows private investors to receive a tax credit against their federal income tax in exchange for investment in low-income communities.
"For this round of funding, the city expanded its footprint to include the same 11-county footprint as the Northeast Indiana Regional Partnership,” Sharon Feasel, director of the Fort Wayne fund, said in February. “I think the treasury would like to see more projects be done in rural areas."
To qualify, a project must be in a census tract designated as low income. As a practical matter, projects also need to be in the $6 million to $8 million range, at a minimum, because of the complexities involved in structuring the deal, Feasel said.
Tax-credit funding cannot be used for projects that are purely residential, but multiuse projects that have a residential component may qualify. The first time the city of Fort Wayne used the new markets credits was to complete the financing package for The Harrison, the office/residential building adjacent to Parkview Field, in 2008.
The tax credits can’t be the sole funding for the project, but they can leverage other private and public investment and be the final piece of the puzzle for projects that are otherwise almost ready to go.