Top Financial Tools
DCA Downtown Development Revolving Loan (DDRLF)
The purpose of the Downtown Development Revolving Loan Fund (DD RLF) is to assist cities, counties and development authorities in their efforts to revitalize and enhance downtown areas by providing below-market rate financing to fund capital projects in core historic downtown areas and adjacent historic neighborhoods where DD RLF will spur commercial redevelopment.
GA Cities Foundation Revolving Loan Fund (GCFRLF)
Applications are evaluated based on leadership, accountability, long-term sustainability, and potential for private investment. Projects should encourage spin-off development, add jobs, promote downtown housing, or add to the cultural enrichment of the community. Each application must also undergo credit underwriting. Eligible Projects include real estate acquisition, building rehabilitation, new construction, green space and parks. Ineligible uses of funds are operating expenses and administration, local revolving loan funds, public infrastructure projects, streetscapes, and facade projects.
Local governments which undertake redevelopment and revitalization efforts in certain older commercial and industrial areas can now qualify those areas for the State’s maximum state job tax credit of $3,500 per job. The incentive which is available for new or existing businesses which create two or more jobs are credits which can be taken against the business’s income tax liability and state payroll withholding. The credits are available for areas designated by DCA as “Opportunity Zones”. DCA will consider designations for areas that are within or adjacent to a census block group with 15% or greater poverty where an enterprise zone or urban redevelopment plan exists.
Tax Allocation Districts (TADs)
Tax Allocation Districts or TADs, often called Tax Increment Financing (TIF) in other states, are a popular mechanism for revitalizing blighted or underutilized areas such as brownfields, declining commercial corridors and industrial sites. The process involves designating a Tax Allocation District, establishing its current tax base floor and then dedicating future taxes over and above that floor for a given period of time to pay the costs (often but not always through issuing bonds) of the infrastructure, buildings or other improvements needed to spur new, higher density development. TAD funds may be used for a wide range of development activities. Cities, counties and school systems may all decide independently whether to participate in a TAD. City or County participation in a TAD requires a jurisdiction-wide referendum. TADs may be administered by local governments, DDAs, Housing Authorities or Redevelopment Agencies.
The State Enterprise Zone program intends to improve geographic areas within cities and counties that are suffering from disinvestment, underdevelopment, and economic decline, encouraging private businesses to reinvest and rehabilitate such areas. The Enterprise Zone area must meet at least three of five criteria: 1) Pervasive poverty established using the most current United States decennial census prepared by the U. S. Bureau of Census; 2) Unemployment Rate (average for preceding yr.) at least 10% higher than State or significant job dislocation; 3) Underdevelopment evidenced by lack of building permits, licenses, land disturbance permits, etc. lower than development activity within local body's jurisdiction; 4) General distress and adverse conditions (population decline, health and safety issues etc.); and 5) General Blight evidenced by the inclusion of any portion of the nominated area in an urban redevelopment area.
Federal Rehabilitation Investment Tax Credit Program (RITC)
The Federal Rehabilitation Investment Tax Credit Program (RITC) provides owners of "certified historic structures" the opportunity to apply for a federal income tax credit equal to 20% of the rehabilitation cost. Only income-producing properties are eligible to participate in the program and the National Park Service must certify the rehabilitation in order to receive the credit.
New Market Tax Credit (NMTC)
The New Markets Tax Credit (NMTC) Program permits taxpayers to receive a credit against Federal income taxes for making qualified equity investments in designated Community Development Entities (CDEs). Substantially all of the qualified equity investment must in turn be used by the CDE to provide investments in low-income communities. The credit provided to the investor totals 39 percent of the cost of the investment and is claimed over a seven-year credit allowance period.
State Historic Preservation Tax Incentives
The Georgia State Income Tax Credit Program for Rehabilitated Historic Property allows eligible participants to apply for a state income tax credit equaling 25% of qualifying rehabilitation expenses capped at $100,000 for personal, residential properties, and $300,000 for income-producing properties. The credit is a dollar for dollar reduction in taxes owed to the State of Georgia and is meant to serve as an incentive to those who own historic properties and wish to complete a rehabilitation. The Georgia Preferential Property Tax Assessment Program for Rehabilitated Historic Property allows eligible participants to apply for an 8-year property tax assessment freeze. This incentive program is designed to encourage rehabilitation of both residential and commercial historic buildings by freezing property tax assessments for eight and one-half years.