Development Tax Break Caught in Congress' Crosshairs
The perpetually gridlocked 113th Congress has just over a month left to decide whether 56 tax provisions should be renewed or expire. And one break intended to bring development to poor communities has provoked especially fierce debate. Since 2000, the New Markets Tax Credit program has given incentives (worth 39% of equity investments) to "Community Development Entities" investors. But while the NMTC was meant to spur development in neglected areas, the New York Times writes that the credits have helped build projects as centralized as the $110M Georgia Aquarium in Atlanta's bustling Centennial Olympic Park.
High-profile and perhaps dubious beneficiaries like that have led Sen. Tom Coburn and the Government Accountability Office to deem the NMTC a lobbyist earmark and fight against its renewal before this congress officially ends on Jan. 3, 2015. On the other hand, the program had, through 2011, financed 3,500 businesses and over 109M SF of CRE growth in underserved areas.