The Community Development Finance Authority in Concord awarded CATCH Neighborhood Housing a tax credit award of approximately $935,000 for development of phase II of the Bow Highlands workforce housing project. The award allows Centrix Bank in Bedford to donate the land and development rights for the property to CATCH in exchange for state tax credits worth 75 percent of that contribution.

This is a great opportunity to expand quality workforce housing in a wealthy community that has few options available for low- to moderate-income residents, said Kevin Flynn, CDFA communications director. The project's goal is to create an additional 16 rental units. CDFA's tax credit award puts CATCH in a strong position to obtain the remaining financing to begin construction.

The Bow Highlands II project was among 30-plus applications reviewed in July by the board of directors during CDFA's $6 million tax credit awards round. At that time, CATCH's application was tabled so staff could receive a legal clarification on the proposed donation and a review appraisal. After both came back satisfactory, the board approved CATCH's application at its August meeting.

This is unlike our typical awards in which recipients solicit cash contributions from businesses in exchange for the tax credits. Instead of cash, CATCH will receive the real estate it needs and the bank will receive a 75 percent tax credit for that property donation, said Flynn. Real estate donations were common during the foreclosure crisis of the 1990s, but we've done only a handful since then.

Centrix Bank has said it will purchase the real estate from the current owner in a short sale, then donate the Bow property through CDFA. The allowable value of the donation and the tax credit will be determined at the time of closing, but is not to exceed $935,000. Bow Highlands II becomes the 17th community development project awarded CDFA tax credits in the 2012 round, bringing the awards total to $6.3 million.

The CDFA Tax Credit Program, also known as the Community Development Investment Program (CDIP), enables businesses to invest cash, securities, or real property to fund CDFA-approved projects in exchange for a 75 percent state tax credit. It can be applied against the New Hampshire business profits, business enterprise, and insurance premium taxes. The organizations that are awarded state tax credits are responsible for raising donations in the amount of their tax credit award from for-profit businesses that have a New Hampshire state tax liability.

The CDFA, created by legislation in 1983, is a nonprofit public instrument of the State of New Hampshire. CDFA administers nearly $57 million in funding resources, which includes a combination of state tax credits and federal Community Development Block Grant, Neighborhood Stabilization, and Energy Reduction Funds.  CDFA supports the development of vibrant and resilient communities by providing resources for community development efforts. For more information about CDFA and its programs visit www.nhcdfa.org or call 603-226-2170.

All Stories