NMTC authority allows U.S. Bank to continue stimulating economic
growth, supporting job creation and fostering the development of
community services across the country
ST. LOUIS--(BUSINESS WIRE)--May. 10, 2013--
The U.S. Department of the Treasury granted U.S. Bank, via its community
development entity USBCDE, LLC, the authority to raise $65 million in
financing for low-income communities.
The award is part of a $3.5 billion New Markets Tax Credit (NMTC)
allocation authority package announced in April by the Treasury’s
Community Development Financial Institutions Fund (CDFI Fund). USBCDE is
one of only 85 community development entities (CDEs) which received
allocation authority out of a pool of 292 applicants.
CDEs utilize allocation authority to attract private sector investments
in disadvantaged communities that lack access to the patient capital
needed to support and grow businesses and create jobs. The program is an
efficient and effective mechanism for infusing up-front capital in areas
that need it the most.
“Since its inception in 2000, the program has met its mission of
bringing critical financing to low-income communities,” said Zack
Boyers, chairman and chief executive officer of U.S.
Bancorp Community Development Corporation, the community investment
subsidiary of U.S. Bank. “In fact, it’s generated more than twice the
amount of funding than originally anticipated and has helped transform
many inner cities and small towns throughout America as a result.”
In addition to being an efficient tool for driving capital to
underserved markets, the program also spurs economic development. The
nearly 3,000 real estate developments and businesses galvanized by the
NMTC Program during 2003-2010 have created more than 500,000 jobs.
Prior to this announcement, USBCDE had received five allocations
totaling $535 million, 96% of which has been utilized. To date, USBCDE
has partnered with 50 other CDEs to raise more than $1.7 billion for
nearly 90 community development initiatives across the country.
Some of the diverse businesses and developments that USBCDE has been
able to finance with its allocation awards include raising capital for:
the development of a science center in a vacant building near Los
Angeles, which will provide science, technology, engineering, and math
outreach programs to local schools and low-income and underserved
children; the renovation of a tornado-damaged building in Kentucky into
a community center; the development of a retail plaza in a distressed
Brooklyn neighborhood, one component of a mixed-use, master-planned
community; and the installation of equipment at a manufacturing plant in
rural Wisconsin. These projects created 1,405 construction and 1,889
full-time jobs and retained 356 positions.
U.S. Bank, which also serves as the most active NMTC investor in the
country through its St. Louis based subsidiary, U.S. Bancorp Community
Development Corporation, has committed more than $3.6 billion of NMTC
equity in support of approximately 1,800 businesses and real estate
developments across the United States. USBCDC also provides capital
investment for the renovation of historic buildings, the construction of
needed affordable and market-rate homes, and the development of
renewable energy facilities.
About the New Markets Tax Credit Program
The New Markets Tax
Credit Program (NMTC Program) was established by Congress in 2000 to
spur new or increased investments into operating businesses and real
estate projects located in low-income communities. The NMTC Program
attracts investment capital to low-income communities by permitting
individual and corporate investors to receive a tax credit against their
federal income tax return in exchange for making equity investments in
specialized financial institutions called Community Development Entities
(CDEs). The credit totals 39 percent of the original investment amount
and is claimed over a period of seven years (five percent for each of
the first three years, and six percent for each of the remaining four
years). The investment in the CDE cannot be redeemed before the end of
the seven-year period. Learn more at www.cdfifund.gov.
About U.S. Bancorp Community Development Corporation
Bancorp Community Development Corporation, a subsidiary of U.S. Bank,
has invested more than $10.9 billion of tax credit equity in community
development projects across the country as of March 31, 2013, using
state and federally sponsored tax credit programs. USBCDC's commitments
provide capital investment to areas that need it the most and have
contributed to the creation of new jobs, the rehabilitation of historic
buildings, the construction of needed affordable and market-rate homes,
the development of renewable energy facilities, and the generation of
commercial economic activity in underserved communities. Visit USBCDC on
the web at www.usbank.com/cdc.
About USBCDE, LLC
USBCDE, U.S. Bank’s six time award winning
community development entity, strengthens distressed and underserved
communities throughout the nation using the New Markets Tax Credit
Program. USBCDE provides equity and favorable loan rates and terms to
finance high impact business expansion and real estate projects. All
investments must satisfy an impact test to help ensure that the
investment will trigger significant, material economic and social
benefits; and would not be accomplished, or would be subject to material
risks and indefinite delays, if not for the NMTC financing.
About U.S. Bank
U.S. Bancorp (NYSE: USB), with $355 billion
in assets as of March 31, 2013, is the parent company of U.S. Bank, the
5th largest commercial bank in the United States. The company operates
3,080 banking offices in 25 states and 5,056 ATMs and provides a
comprehensive line of banking, brokerage, insurance, investment,
mortgage, trust and payment services products to consumers, businesses
and institutions. Visit U.S. Bancorp on the web at www.usbank.com.
Source: U.S. Bank
Nicole Garrison-Sprenger, 612-303-0731