Six projects in Fort Wayne and Angola will receive a share of $55 million in federal New Markets Tax Credits, Mayor Tom Henry announced Thursday.
"It certainly is a major win for the city of Fort Wayne and all of northeast Indiana," Henry said. "Now, you have to understand overall very few communities received any allocation at all. So we were very very fortunate to provide the federal government with applications that they considered for further examination and ultimate funding."
Byron Health Center, the Fort Wayne Rescue Mission, the Fort Wayne Boys & Girls Clubs, The Landing, the Electric Works project and Angola-based Vestil Manufacturing all received tax credits this round. They received $12.5 million, $10 million, $8 million, $4.5 million, $12 million and $8 million, respectively.
"Although none of them were able to receive all that they requested, we felt that the distribution process was fair and equitable," Henry said.
Byron Health Center is planning to relocate from Lima Road to the corner of Beacon Street and Lake Avenue and the Rescue Mission will put its tax credits toward its new facility on East Washington Boulevard. The Boy and Girls Clubs' tax credits will go to support a 2.3-acre campus and building currently under construction and Vestil Manufacturing plans to add 100 new jobs to the Angola area by 2021 with a 225,000 square-foot fulfillment center.
"Without the New Markets Tax Credits allocation this would be more difficult for them to get online as fast as they needed it to," said Sharon Feasel, director of the Fort Wayne New Markets Revitalization Fund. "And it is important. They have customers who are demanding just in time, next day fulfillment of their orders."
Although it did not receive the largest share of the tax credits announced Thursday, the Electric Works project south of downtown is probably one of the most prominent. To make the project a reality, RTM Ventures, which is developing the project, has asked for $50 million in city funds. It's unclear whether the $12 million announced Thursday would count as private or public investment. Phase 1 of the project is expected to cost about $221 million.
New Markets Tax Credits allow investors to receive tax credits against their federal income tax in exchange for investing in low-income communities. The credits are dispersed to community development entities throughout the country. Those entities sell the tax credits to private investors, usually large financial institutions and then use the money to invest in projects. Although the amount generated by the sale can vary, it is typically 20 percent of the tax credit allocation for the project.
For example, the $12 million awarded to the Electric Works project represents about $2.4 million in equity for the project.
Thursday's announcement came just days after the Fort Wayne City Council approved a nonbinding resolution asking city officials to refrain from announcing the tax credits for Electric Works until the entire $50 million public funding package is negotiated. It also came a day after the Fort Wayne Legacy Joint Funding Committee voted to fund the project. However, the committee stopped short of committing to a monetary figure for that investment.
The developers of Electric Works are also planning a public community forum for 5:30 p.m. Tuesday at the Grand Wayne Center. The development team plans to provide updates, an overview and key information about the development, followed by a question-and-answer session moderated by local media. City Council is also expected to consider two rezoning petitions and a primary development plan for the site next month.
The rezonings, which cover both the east and west sides of the project, would change the land from its current residential classification to limited commercial.