The redevelopment of the historic Zakies, Woolworth and Weinbrom buildings will be a tedious, time consuming and expensive process. The New Market Tax Credit financing will allow RSDC to embark on this project knowing, with confidence, that this funding combined with the support of the business community, local foundations and organizations, and private investors will result in the rebirth of the West Market Street corridor, while continuing the ripple effect of positive redevelopment of the downtown York area.
Powder Mill Foundation
Downtown Renaissance Fund
New Market Tax Credit Program
New market tax credits
Historically, low-income communities experience a lack of investment, as evidenced by vacant commercial properties, outdated manufacturing facilities, and inadequate access to education and healthcare service providers. The New Market Tax Credit Program (NMTC Program) aims to break this cycle of disinvestment by attracting the private investment necessary to reinvigorate struggling local economies. As of the end of FY 2015, the NMTC Program has generated $8 of private investment for every$1 of federal funding.
The excessive cost of the extensive renovations needed for the three properties that encompass the Market Street Revitalization Project to make the desired economic impact, combined with the market rate income for the downtown area, make it virtually impossible to cost effectively convert the vacant deteriorating properties to useful, desirable space. With the almost $8.5M in tax credits, neighborhood altering projects like this one would not be economical or financially feasible.
COMMUNITY FIRST FUND
Community First Fund (CFF) provides a variety of loans to individual and community based organizations committed to starting or expanding small or mid-sized businesses, creating affordable housing units or developing commercial spaces that will impact the community. Central and eastern Pennsylvania cities are full of pioneering people and organizations committed to making a positive and visible community impact.
CFF served as the certified Community Development Entity that allocated the New Market Tax Credits to the Market Street Revitalization Project. The partnership with CFF allowed for the fluid distributions of the tax credit funding to this benchmark project. By virtue of this allocation, Market Square was also able to attract Fulton Bank as an investor in the NMTCs.
In addition, CFF was able to provide the NMTC financing to Market Square with benefits that included interest rates far below the current market, interest only payments for seven years and higher than normal loan to value ratios, which allows the project to create residential and commercial opportunities, including new jobs, to this highly distressed section of York.
Fulton Bank has been a vital part of the growth and development of south central Pennsylvania, providing strength and support to the community since 1882. As one of the leading financial institutions in the region, their community-oriented style of banking and commitment to their customers enables them to provide flexibility and timely response customers need, helping them to sustain mutually satisfying, long-term banking relationships.
Both the corporate and local levels of Fulton Bank were crucial in providing gap funding for the Market Street Revitalization Project. Fulton acted as the senior lender as well as the New Market and Historic Preservation Tax Credit investor.