Tax credits lift poor communities
AS YOU WERE SAYING ...
The 2016 presidential election told us one thing loud and clear: many voters felt overlooked and left behind by our country’s economic recovery. They want to know that our elected officials care about and support policies that work for all Americans, including those hardest hit by the economy — both urban and rural families.
That is why I was pleased that U.S. Rep. Richard Neal (DSpringfield) has re-introduced the New Markets Tax Credit Extension Act of 2017 with his House Ways and Means Colleagues, Rep. Pat Tiberi (R-Ohio) and Rep. Tom Reed (R-N.Y.). A similar measure was introduced in the Senate by Sens. Roy Blunt (R-Mo.) and Ben Cardin (D-Md.).
The measure is designed to increase the flow of capital to businesses and low-income communities by providing a modest tax incentive to private investors. Over the last 10 years, this program has proven to be an effective, targeted and cost-efficient financing tool, generating over $80 billion in investments and creating some 750,000 jobs in poor communities nationwide.
Brockton is a prime example of a city in need of economic and community revitalization right in our own state. One-third of the population lives under 200 percent of the poverty threshold and unemployment reaches 25 percent in some neighborhoods. The community is also home to a large immigrant population, but has few places where residents can purchase ethnic foods.
Vincente’s Supermarket, a local ethnic grocer, was looking to expand to better serve the community, but lacked sufficient capital to redevelop a vacant supermarket site it found in a neighborhood adjacent to a federally designated “food desert.”
The New Markets Tax Credit became the lynchpin in making their project happen.
Since 2003, a total of 241 businesses and economic revitalization projects in Massachusetts have received NMTC financial assistance. That $1.82 billion in assistance has generated an additional $884.2 million from other sources for a total of $2.7 billion in project investments. That in turn has created more than 16,000 construction jobs and more than 15,000 full-time equivalent jobs.
Last month, President Trump released his tax reform plan. Congress has also begun its work, with the House Ways and Means Committee holding its first hearing on tax reform in May. With this process moving forward, we need to be sure our elected officials know that there is a bipartisan and effective way to generate economic opportunity in distressed communities, and to encourage partnerships that can make a critical difference in forgotten communities.
It’s time for us to invest in federal programs that deliver results. The New Markets Tax Credit is one of those programs.
Brockton is a prime example of a city in need of economic revitalization — where unemployment reaches 25 percent in some neighborhoods.