From: | Tony Chenhansa <tonyc@cpeo.org> |
Date: | Thu, 24 Jun 1999 10:40:56 -0700 (PDT) |
Reply: | cpeo-brownfields |
Subject: | [Fwd: Report from the Clean Land Fund] |
This message originated from a different Brownfields Listserve. From: "William J. Penn" <WPenn@compuserve.com> I am very pleased to report that after more than two and one half years of negotiations with the IRS the Clean Land Fund has finally received its 501(c)(3) tax-exempt designation. Our initial application which was based on the economic, environmental and social benefits of financing the cleanup of Brownfields sites was denied by the IRS. We were told that Brownfields financing was a private sector real estate transaction and did not qualify for tax-exempt status. In our appeal, we shifted the benefit emphasis to our borrowers i.e., nonprofit organizations, minority owned businesses and businesses who are or will locate in economically distressed areas (the location of most Brownfields in the Northeast). The IRS was satisfied with this approach since it brought the Clean Land Fund more closely in line with CDCs and CDFIs. To my knowledge, we are the first private sector, nonprofit revolving loan fund dedicated solely to the financing of the clean up of Brownfields sites to receive a 501(c)(3) designation. Our present business strategy is to develop co-lending arrangements with the sixteen EPA funded municipal Brownfields Cleanup Revolving Loan Funds (BCRLF) located in the Northeast (EPA Regions 1& 2). As a co-lender, the Clean Land Fund will be able to finance those cleanup cost which are not eligible for the BCRLF i.e., structural remediation, petroleum remediation and soft costs such as capitalization of interest, loan fees and environmental insurance premiums. Our plan is to match the $11 million in capital the EPA committed to these BCRLF on May 25, 1999 by borrowing debt capital from banks doing business in the sixteen communities. The banks as debt capital lenders to the Clean Land Fund will receive CRA credits as well as interest on their loans. We feel this will be an economic incentive to develop private/public partnerships to finance the comprehensive cleanup of Brownfields sites in these communities which will improve the economic, environmental and social quality of life for community residence. If there are any nonprofit organizations or individuals who would like to establish a Clean Land Fund affiliate in their geographic area outside of the Northeast, we would be very interested talking with you. We have learned a great deal of what it takes to start-up a Brownfields nonprofit revolving loan fund and we would like to share this with those of you who may be interested in replicating what we have accomplished in your region. Bill Penn Clean Land Fund PO Box 725 Block Island, RI 02807 E-mail: wpenn@compuserve.com | |
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