(R-Maine)
Since its inception, the New Markets Tax Credit Program has helped bring critical investment dollars to our state to help spur job creation and opportunity in some of our most disadvantaged communities. Last week, I was pleased to announce that Coastal Enterprises, Inc. of Wiscasset had been awarded $120 million in New Markets Tax Credits (NMTC) by the U.S. Department of Treasury. This vital funding will be used to foster development and economic growth throughout Maine – a goal we can all agree is essential to improving our state’s future.
The New Markets Tax Credit Program – which was enacted in December 2000 — offers a seven-year, 39 percent Federal tax credit made through investment vehicles known as Community Development Entities. These CDEs — like Coastal Enterprises — combine private investment dollars with capital raised through the tax incentive to make loans to or investments in businesses in low-income communities.
This NMTC allocation will allow CEI to structure deals that make capital available at rates up to 400 basis points below prevailing rates, and on more flexible and favorable terms. Coastal Enterprises, Inc. (CEI) provides financial and technical assistance to small and medium sized businesses located in primarily rural regions of northern New England. CEI will direct its loans and investments primarily to non-real estate businesses (both for-profit and non-profit entities), providing flexible debt for rural, natural resource-based businesses. It will focus on both small and medium-sized enterprises needing less than $2 million in capital, as well as high community-impact businesses with capital needs between $2 million and $20 million.
This past summer, I delivered remarks at a celebration at the Gulf of Maine Research Institute in Portland to mark the success of the New Markets Tax Credits Program, including the nearly $200 million of New Markets funds that have been utilized by Coastal Enterprises. I was honored to join Kimberly Reed, Director of the U.S. Treasury Community Development Finance Institution fund and Governor John Baldacci in praising the success of the NMTC program in helping to revitalize low-income and rural communities in Maine and America.
Earlier last year, I was pleased to join my fellow Senate Finance Committee colleague, Sen. Jay Rockefeller (D-W.V.) in introducing the New Markets Tax Credit Extension Act of 2007, which would extend the New Markets Tax Credit Program (NMTC) for five years through 2013. The NMTC has a longstanding history of promoting investment and economic growth opportunities in low-income, rural communities. Last year, we were successful in securing a one-year extension for the program through 2008 and I am hopeful that Congress will act soon to further extend this invaluable program.
The hardworking can-do spirit of Mainers is recognized world-wide and the quality of our workforce – in every industry – is exceptional. As we work together to build a stronger economy, we must continue to promote programs that provide the necessary assistance our state needs to keep our small businesses competitive and successful. It is imperative that we do all that we can to stimulate investment and economic growth in our rural, low-income communities and I am pleased that the New Markets Tax Credit Program has helped our state achieve that critical goal.
