There may be an answer for how to help pay for development of a new James Brown Arena.
The Augusta-Richmond County Coliseum Authority has entered into an agreement with ILS Corporate Services, LLC of New York to explore using New Market Tax Credits to help pay for the project.
NMTC is a program by the U.S. Treasury Department through the Community Development Financial Institutions Fund.
“The NMTC Program attracts private capital into low-income communities by permitting individual and corporate investors to receive a tax credit against their federal income tax in exchange for making equity investments in specialized financial intermediaries called Community Development Entities (CDEs),” from the website https://www.cdfifund.gov/
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The program targets community development and economic growth with tax credits to attract private investors specifically to low income and distressed communities.
The arena project’s location on Seventh Street meets all three federal guidelines of poverty rate, median family income and unemployment rate.
Authority members voted May 24 to enter into an agreement with the New York firm which includes developing a project profile that the company can then use to secure NMTC allocations.
The cost to hire the consultant totals $17,500. Authority attorney Ed Enoch said it is not possible to project how much money will be generated for the project.
“Basically, all of the current new market tax credits are already allocated, however some of those won’t go through, some of those projects won’t make. So, they’re going to be out there looking for anything that might fall through the cracks and might get picked, and then also, for any that are newly authorized, get us in front of that. So, basically, it’s going to cost us $12,500 and $5,000 in in potential expenses for them to look,” he said, adding there is the potential for collecting upwards of $2 million.
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Brad Usry, chairman of the new JBA subcommittee, said it was best to hire someone who knows the process of pursing NMTC funds, adding he wanted Augustans to understand every step of the financial process.
“This whole project will be where we’re going to keep it out to the taxpayers because ultimately, they’re paying for this thing, so we want them to know what’s going on. We’re going to try to keep as much information on the streets as we can,” he said
The New James Brown Arena project, anticipated to cost $240 million, is three components. One is to replace the aging arena with a facility that will seat 10,000 people for a concert. By comparison, the existing arena seats about 6,500 for a concert.
The second component is to build a connector between the new arena and the Bell Auditorium. The third component is upgrades and improvements to the Bell.
Project manager HB Brantley of Atlanta-based SPACE, who is working with the new JBA subcommittee, recommended moving forward with work on the Bell.
“The Committee recommends that the board gives authorization to move forward and retain the necessary consultants to perform the initial due diligence and assessment of existing conditions to determine the best path forward for the Bell Auditorium. The committee also recommends that we move forward with the RFQ RFP process for construction manager so that they can work in conjunction with the design team so we can understand the actual costs before we get to the end of the project,” he said.
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The authority also approved that recommendation.
Usry said the advantage to moving ahead with improvements at the Bell mean, when the arena and connector projects kick off, the Bell can stay open and continue to bring revenue to the city.
He said he wants a high priority placed on using local contractors and minority-owned companies for the Bell Auditorium project.
Dana Lynn McIntyre is a general assignment reporter for The Augusta Press. Reach her at dana@theaugustapress.com
