As it begins to feel the effects of the Section 1603 program's expiration, the renewable energy tax equity market is at a critical juncture. Although the grant program expired last December, most developers lined up Section 1603 deals to see them through the better part of this year and delayed the return to traditional tax credits.
In a dusty valley roughly 20 miles outside Bakersfield, Calif., stands a power plant that Kern County’s economy has relied on for more than 20 years. The Mt. Poso Cogeneration Company (MPCC) has been one of the highest-paying industrial employers in the area since it began firing coal in 1989. But the subsequent two decades brought national security concerns over fossil fuel dependence, technological advancements in renewable energy and a growing sense of environmental responsibility. After California began requiring its electric utility companies to derive an increasing percentage of their retail sales from renewable energy sources, a renewal of the original 20-year power purchase agreement (PPA) on which the plant’s existence hinged seemed less and less likely.
The U.S. Department of the Treasury's Community Development Financial Institutions Fund (CDFI Fund) released the 2012 Notice of Allocation Availability (NOAA) for the 2012 round of competition for $5 billion in New Markets Tax Credits, pending Congressional authorization of the New Markets Tax Credit Program.
SECDE Ventures, LLC announced the closing of $18 million in New Markets Tax Credit financing for construction of Resinall Corp's new Hydrogenated Hydrocarbon Resin unit at its manufacturing facility in Hattiesburg, Mississippi. By shifting into this new market and as a result of the NMTC financing, Resinall will preserve 125 manufacturing jobs, and create additional jobs.
This report was prepared by Rapoza Associates for the New Markets Tax Credit Coalition. The New Markets Tax Credit (NMTC) Coalition is a national membership organization that advocates on behalf of the NMTC program. The Coalition is managed by Rapoza Associates, a public interest lobbying, policy analysis, and government relations firm located in Washington, DC that specializes in providing comprehensive legislative and support services to community development organizations, associations and public agencies.
Under a tight deadline to begin construction last year on a solar thermal system for a poultry processing plant, North Carolina-based FLS Energy received construction funds at the end of September, strove to find American-made steel pipe and solar panels to start construction in October, and activated the project’s first two phases in December. The construction timeline put the Prestage Foods project safely within the qualification parameters for a Section 1603 cash grant in lieu of renewable energy investment tax credits (ITCs). Source: Novogradac Journal of Tax Credits, April 2012, Volume III, Issue IV
Local coverage of DV Community Investment's $65 Million New Markets Tax Credit Allocation.
New Orleans, LA - Neil Wolin, U.S. Treasury Deputy Secretary and Donna Gambrell, Director of the Community Development Financial Institutions Fund, announced the 70 Community Development Entities who were selected to receive New Markets Tax Credit allocations in the 9th Round. The New Markets Tax Credit allocations awarded totaled approximately $3.6 billion in tax equity.
The ninth round of New Markets Tax Credit (NMTC) Program Awards will be announced by Deputy Treasury Secretary Neal Wolin, along with Louisiana's U.S. Senator Mary Landrieu and Representative Cedric Richmond at on Thursday, February 23, 2012 2 p.m. CT. Five Louisiana institutions will receive New Markets Tax Credit allocations to invest in local development projects.