[Congressional Record Volume 154, Number 111 (Tuesday, July 8, 2008)]
[Senate]
[Page S6432]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                         NEW MARKETS TAX CREDIT

  Mr. SMITH. Mr. President, I wish today to talk about the impact the 
new markets tax credit has had in revitalizing distressed neighborhoods 
in my home State of Oregon.
  The new markets tax credit has become a vital financing tool to 
organizations throughout Oregon, like United Fund Advisors and Portland 
Family of Fund, to invest in and nurture business opportunities in our 
low income communities that are in need of investment capital.
  The New Markets Tax Credit was signed into law in 2000 with the goal 
of using a modest Federal tax credit as an incentive to attract private 
investment capital to viable urban and rural markets that private 
investors often overlook and I am happy to report that the credit has 
done just that.
  The Treasury Department reported that as of July 1, 2008, the credit 
is responsible for $11 billion of new investment going into 
economically distressed communities across the country. More than $600 
million in NMTC- supported projects have been launched in Portland 
alone with the promise to create more than 9,000 construction and 
permanent jobs for city residents.
  United Fund Advisors and its sister organization Portland Family of 
Funds are but two organizations using the credit in my home State, but 
I hold up their works as an example of how the NMTC can work.
  United Fund Advisors and Portland Family of Funds recognized the 
potential of downtown Portland. Since 2002, through their CDEs, they 
have been awarded $165 million in credits, which they have used to 
attract investors to finance vital community services, as well as 
businesses in neighborhoods that have suffered from chronic poverty and 
disinvestment.
  In downtown Portland, the credit has financed several community 
facility projects, including the Community Transitional School, which 
is an elementary school that serves homeless children throughout the 
city. The school serves over 200 homeless children a year and has been 
in operation since 1990. However, it was unable to secure the financing 
it needed to support the $3.5 million rehabilitation of its facility to 
create a safe, stable and permanent home for the school. The credit was 
used to attract financing from U.S. Bancorp to make the project 
possible and the school now expects to open the doors to its new 9,500-
square-foot facility this fall.
  The credit also provided the gap financing necessary to develop a 
drug rehabilitation facility within the Union Gospel Mission and to 
rehabilitate a theater and community space in the Portland Armory, 
which had been lying vacant for about 35 years.
  The credit has been used to reclaim abandoned commercial space and 
encourage business development and economic activity in downtown 
Portland. Portland Family of Funds used the credit to assist a minority 
developer finance the development of two business condominiums designed 
to bring minority- and women-owned businesses into the downtown 
Portland market. In addition, the credit financed the Portland Small 
Business Loan Fund which provides financing to new and emerging small 
businesses operating in low-income neighborhoods in the city.
  None of the projects that I just described would have been completed 
without the new markets tax credit. Last year the GAO published a 
report on the NMTC and found that 88 percent of the NMTC investors 
would not have invested in the low-income community or business without 
the subsidy provided by the credit.
  I am a strong supporter of the NMTC because of its potential to bring 
communities and businesses that have traditionally been left out of the 
mainstream financial market into the mainstream market.
  I hope my colleagues will join me to support the extension of the new 
markets tax credit, which is currently set to expire at the end of this 
year. Our cities and rural communities need this program, and I will do 
all I can to see that it is extended and expanded.

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