SCOTTSDALE, Ariz., Jan. 9, 2015 /PRNewswire/ -- Healthcare Community Development Group, LLC (HCDG), a nationally certified Community Development Entity (CDE), served as the New Markets Tax Credits (NMTCs) project leader and allocation aggregator in connection with the issuance and leveraging of the $14.6M financing through Series A internal funds ($8.4M), Series B NMTCs ($3.8M) and an additional $2.4M investment by the hospital.
"Federal Government NMTCs-qualified subsidies are an attractive supplemental financing strategy allowing not-for-profit hospitals, such as Phoenix Children's, to continue meeting growth, infrastructure and community health services needs, while effectively reducing the overall amount of money they need to generate for their projects," Jacque J. Sokolov, Chairman and CEO of HCDG, said. "These are complex transactions, however we serve our clients with an end-to-end solutions approach that includes deploying a highly-skilled project team committed to minimizing administrative and finance department disruption while working to bring funding to a successful conclusion."
"The HCDG-led Phoenix Children's Hospital NMTCs transaction participants included the law firm of Squire Patton Boggs and the accounting firm of Novogradac," Duncan E McGillivray, Chief Operating Officer of HCDG, said. "HCDG had previously approached US Bank to help find NMTC Allocation for the hospital and subsequently another HCDG relationship with the law firm of Snell & Wilmer identified an allocation that had been pre-funded by US Bank for Phoenix Community Development & Investment Corporation (PCDIC) who served as the Allocation lender."
US Bank served as the tax credit equity investor and was represented by Nixon Peabody. Ballard Spahr served as the law firm for PCDIC.
HCDG's core services offering includes complete NMTCs evaluation and investment funding services, including:
- Organizing and assessing funding strategies
- Confirmation of Source A funding commitments
- Securing NMTC commitments
- Finalizing transaction structure
- Executing transaction agreements and deal close
About the New Market Tax Credit Program
The New Markets Tax Credits Program (NMTCs Program) was established by Congress in 2000 to spur new or increased investments into operating businesses and real estate projects located in low-income communities. These investments are expected to result in the creation of jobs and material improvement in the lives of residents of low-income communities. The NMTCs Program attracts investment capital to low-income communities by permitting individual and corporate investors to receive a tax credit against their Federal income tax return in exchange for making equity investments in specialized financial institutions called Community Development Entities (CDEs).
The credit totals 39 percent of the original investment amount and is claimed over a period of seven years (five percent for each of the first three years, and six percent for each of the remaining four years). The investment in the CDE cannot be redeemed before the end of the seven-year period.
About Phoenix Children's Hospital
Phoenix Children's Hospital ("PCH") is a 363-licensed-bed, freestanding children's hospital located in Phoenix, Arizona that provides specialty pediatric services in inpatient, outpatient, emergency, trauma, and urgent care. PCH is one of the largest Children's Hospitals in the country. PCH employs more than 220 pediatric specialists with more than 1,000 pediatric specialists on its Medical Staff and more than 1,000 FTEs on its nursing staff. This represents the largest pediatric group in the state of Arizona. PCH also works in collaboration with Dignity Health and Mayo Clinic to provide more robust care in specialties related to cardiology, neurology, hematology/oncology and organ transplant.
About Healthcare Community Development Group, LLC (HCDG)
HCDG is a nationally-certified Community Development Entity (CDE) and a wholly owned subsidiary of SSB Solutions, Inc. SSB Solutions is a healthcare specialty consultancy that has served clients in 49 states in over 150 markets for the past 21 years.
HCDG is the only national CDE exclusively focused on helping healthcare organizations reduce growth investment costs using the New Markets Tax Credits program. The company is a leader in setting the pace of helping not-for-profit, community-based healthcare systems use both tax-exempt bonds and NMTCs as their funding strategies.
SOURCE Healthcare Community Development Group, LLC