Passage of PATH Act Ensures More, Stable Community Development by U.S. Bank
Final approval today of the Protecting Americans from Tax Hikes Act will
enhance U.S. Bank’s (NYSE: USB) efforts to improve communities through
affordable-housing, renewable energy and economic development in
low-income areas.
The PATH Act, signed into law today by President Obama, included
extensions through 2019 of the New Markets Tax Credit and renewable
energy tax credits, as well as permanent passage of the key nine percent
low-income housing tax credit.
“These tax credit tools are absolutely essential to help ensure all of
our nation’s communities and people are able to reach their full
potential. We have been working with our customers for nearly 30 years
to address issues of equity through investments in affordable housing,
economic development and renewable energy. The president and Congress’
actions enable us to do more towards creating a world where all people
have equal access to the opportunities at the heart of possibility,”
said Zack Boyers, chairman and CEO of U.S. Bancorp Community Development
Corporation--one of the nation’s most active community investment tax
credit investors.
Boyers is one of the newly announced members of the U.S. Bank Coaches
program. The coaches work with and advise individuals and groups on
community development, charitable giving and a variety of consumer
interests such as cyber security.
The PATH legislation was lauded by Matt Philpott, senior vice president
of USBCDC’s New Markets and historic tax credit business. Disadvantaged
communities often require years of work to pull together sufficient
resources. Short-term extensions of key financing tools tend to create
uncertainty about whether the resources can be relied on when needed,
Philpott said. A five-year extension of the $3.5 billion in annual New
Markets Tax Credit financing authority is a truly helpful step in the
right direction for creating a sustainable community development future
for our country, he added.
“The New Markets extension allows us to lay plans with our customers
further into the future. Because these economic development tools are so
critical for catalyzing community improvements that might not otherwise
have been funded by traditional sources, we'll be able to give longer
lead-time projects more certainty. That will, in turn, allow them to
make other necessary commitments and build capacity over a longer period
of time,” Philpott said.
Two renewable energy tax credits that were extended by five years,
phasing down in value each year, will help communities lower residents’
and businesses’ utility bills by encouraging investment in solar, wind
and other green energy sources.
"U.S. Bancorp recognizes the importance of the environmental challenges
facing our customers and communities, especially in the areas of climate
change. Considering the risks of climate change and pollution, we
recognize the extension of the investment tax credit will provide
long-term predictability to the bank, its customers and the communities
we serve. Growth in the renewable energy sector has been a bright spot
for job creation and we saw the threat of these credits’ expiration
already causing uncertainty in project developments and raising capital.
As an established investor in renewable energy, and with passage of the
PATH Act, we are well-positioned to bring new capital into the market
while serving our existing customers,” said Darren Van’t Hof, vice
president and head of USBCDC’s renewable energy production group.
The nine percent low-income housing tax credit becomes permanent under
the PATH Act and will have a positive effect on reducing housing
inequity in every state.
“U.S. Bank has been a long-time advocate of and investor in affordable
housing for low-income people. We recognize how critical safe and secure
housing is in our communities. The inclusion of the permanent nine
percent low-income housing tax credit rate floor will increase
predictability and financial feasibility of affordable housing at a time
when the need continues to grow,” said Beth Stohr, senior vice president
and head of the bank’s affordable housing group.
With nearly $16 billion in managed assets as of Sept. 30, 2015, U.S.
Bancorp Community Development Corporation, a subsidiary of U.S. Bank,
provides innovative financing solutions for community development
projects across the country using state and federally sponsored tax
credit programs. USBCDC's commitments provide capital investment to
areas that need it the most and have contributed to the creation of new
jobs, the rehabilitation of historic buildings, the construction of
needed affordable and market-rate homes, the development of renewable
energy facilities, and the generation of commercial economic activity in
underserved communities. Visit USBCDC on the web at www.usbank.com/cdc.
U.S. Bancorp (NYSE: USB), with $416 billion in assets as of September
30, 2015, is the parent company of U.S. Bank, the fifth-largest
commercial bank in the United States. The company operates 3,151 banking
offices in 25 states and 5,001 ATMs, and provides a comprehensive line
of banking, investment, mortgage, trust and payment services products to
consumers, businesses and institutions. Visit U.S. Bancorp on the web at www.usbank.com.
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