CDC Tax Credit

Before I became a legislator, my professional track record was built upon administering community economic development (CED) grant programs - and my work with neighborhood business associations and community development corporations. My expansion of those CED programs was well-documented in the Community Development Block Grant (CDBG) Study and Community Reinvestment Report, two policy papers released by my legislative office in 2000. Those policy papers found that expanding the use of CDBG resources for economic development would leverage more private investment into low-and moderate-income neighborhoods. Economic development investments have always had greater leveraging ability than low-income housing subsidies. Additionally, the utilization of community development corporations (CDCs) to undertake certain economic development activities in disadvantaged neighborhoods would bolster those organizations and their overall revitalization efforts.

As a legislator, I established the Community Development Corporation (CDC) Tax Credit Program.  It began as a pilot program under which up to ten (10) businesses would receive tax credits of $100,000 per year against business privilege tax (BPT) liability for each year the business contributes $100,000 in cash to a Qualifying CDC.  Each business is required to enter into a contribution agreement with the City under which it agrees to contribute $100,000 in cash per year for ten (10) consecutive years to a Qualifying CDC designated by the business.  There are now over 40 community based nonprofit organizations engaged in the program that have received roughly $40 million since the inception of the program to manage neighborhood commercial corridors and to undertake other economic development activities.

Our task as public policy makers must be to incentivize investment into economically disadvantaged communities that have experienced historic disinvestment or redlining. The CDC Tax Credit Program has done that and more – and will outlive my tenure in City government.