Finance Committee - 5/16/2018 Page 4
Mr. Cummings
Again, for the record, Tim Cummings, Director of Economic Development; this is essentially if you wanted to
look at it from an organizational standpoint, would be a strategy that we could use to execute in raising of the
$4 million dollars or bringing additional non-public, non-city money to the project. We have a fund raising
consultant and she will make recommendations and strategies which will include looking at grants,
foundations, tax credits, direct private sector investment, marketing opportunities with sponsorships and
naming rights. Then a subset of that, and we’ve said from the beginning because of where this building is and
because of the nature of downtown redevelopment, there is a particularly unique opportunity for us to pursue a
new market tax credit. We know that this project qualifies for it, we’ve had that conversation well in advance
before we even moved forward.
So we are wanting to get a jump on the gun, | put an RFP out we solicited proposals from 3 different vendors
from all across the country one based in California, one based in Boston, Massachusetts. And then this local
vendor who is based out of what is essentially Manchester and who has done extensive work in new market
tax credit financing which is just another type of financing to help close a gap in a private sector project. So
what you have before you is a proposal by Niel Cannon who has done most of the work up in Concord for new
market tax credits. He is looking to pursue a new market tax credit on our behalf for 201 Main Street. We
have had very positive conservations leading up to this.
Mayor Donchess
A new market tax credit is a very technical area and this gentlemen knows this area very well and has qualified
many different projects for a new market tax credit, so that’s the point of this, focusing on that source.
Alderman Klee
Thank you. Do we have any idea as to how much any of these would be, any of these new market tax credits
would be?
Mr. Cummings
Mr. Mayor, if | may, yes | have an idea though | don’t want to be held it. | can tell you that the new tax law that
was just passed by Congress has thrown a little bit of a curve ball into the tax credit market in general. So
taking that one issue and setting it aside, up until this past winter, this type of tax credit received statutorily you
get up to a 39% reimbursement. Of that, what you see, is approximately 20 to 30%, so call it 25% once you
use all the fees and other costs taken away. Essentially what you could see is approximately 25% of a $15
and a half million dollar project. How much actual money that translates into depends on the market. Right
now | am being told, and this is what Niel Cannon specializes in, is really how much on the cents per dollar you
actually receive and it is somewhere between .85 and .90 cents. It is trending a little lower because of what
happened this past winter.
Alderman Klee
Ok thank you.
Alderwoman Caron
Yes thank you, and | am assuming this amount is also coming from the Downtown Committee?
Mr. Cummings
Yes.
