Sixteen New Hampshire organizations are receiving a total of $5.4 million in tax credits from the Community Development Finance Authority for this coming fiscal year. The winning projects were announced Wednesday. Awards include funding for upgrades to Portsmouth’s Prescott Park Pavillion; the conversion of an abandoned Nashua mill into affordable housing units; the rebuilding of Concord’s burned-down soup kitchen; and community theater projects in Peterborough, Lincoln and Manchester.
Here’s how it works. Every year since 1999, the New Hampshire legislature sets aside $5 million for the CDFA to distribute to New Hampshire businesses, as tax credits. To receive these tax credits, a business contributes money to a selection of organizations, as determined by the CDFA board. The business then receives a tax credit on 75 percent of the given donation.The money for the tax credits doesn’t come from the general fund, says CDFA’s communications director, Kevin Flynn. But it does represent about $3.75 million in would-be state revenue. “The trade off,” Flynn explains, “is that we’re getting a return of $42 million.” In other words, by investing just $5.4 million in community development, the state receives a benefit much higher in value.
Janet Ackerman, CDFA’s Acting Board Chairwoman, says there were too many projects this year, and not enough state tax credits to go around. “The desire and demand from the business community to purchase CDFA tax credits is strong. The time is coming to increase the allocations to meet this demand.” Something the CDFA may pitch the legislature next year?