THE WHITE HOUSE AT WORK
Tuesday, May 23, 2000
PRESIDENT CLINTON:
ANNOUNCING A LANDMARK BIPARTISAN AGREEMENT ON AMERICA'S NEW MARKETS"We have achieved an agreement that will allow us to give every family in every community a stake in the prosperity Americans have worked so hard to build."
President Bill Clinton
Tuesday, May 23, 2000Today, at the White House, President Clinton, joined by House Speaker Dennis Hastert, announced a landmark bipartisan agreement on bringing capital and opportunity to America's untapped markets. This New Markets and Community Renewal legislative initiative will help encourage private-sector equity investment in underserved communities throughout the country to ensure that all Americans share in our nation's economic prosperity. Today's announcement is the outcome of the commitment President Clinton and Speaker Hastert made last November to develop a bipartisan legislative initiative on New Markets and revitalizing impoverished communities.
An Unprecedented Commitment to America's Untapped Markets. Since 1993, President Clinton and Vice President Gore have been committed to tapping the potential of America's urban and rural communities by bringing capital, jobs, and opportunity to distressed areas and cleaning up the urban environment. The President has highlighted the potential of America's New Markets in three trips to underserved inner city and rural communities like Newark, NJ, Hartford, CT, the Mississippi Delta, Appalachia, rural Arkansas, and Pine Ridge Indian Reservation in South Dakota. Today's bipartisan agreement marks an unprecedented commitment to bringing new incentives for capital investment to America's distressed and lower-income communities, and contains the following key elements:
New Markets Initiatives
- The New Markets Tax Credit: This credit will spur $15 billion in equity investment and will be available to taxpayers who invest in certain privately-managed investment funds and institutions which use these funds to finance businesses in low- and moderate-income communities.
- America's Private Investment Companies: Leveraging $2 for every $1 in private investment, the agreement authorizes HUD to guarantee up to $1 billion in low cost loans to match $500 million in private investment for a total of $1.5 billion in investments in underserved communities
- New Markets Venture Capital Firms: NMVC firms will provide incentives to increase the availability of venture capital in low and moderate-income communities for small businesses.
Empowerment Zones
- Designates a third round of 9 new Empowerment Zones for a total of 40;
- Expands EZ tax incentives to form strategic partnership with all existing EZs so that all can utilize the 20% EZ wage credit, additional business expensing, and other incentives;
- Commits $200 million in discretionary investment this year for existing EZs;
- Establishes zero-rate capital gains rollover for investments within EZs;
- Provides a 60% capital gains exclusion for investment in small businesses; and
- Extends D.C. tax incentives to 2009.
Renewal Communities
- Creates 40 Renewal Communities (32 urban, 8 rural), designated by the U.S. Dept. of Housing and Urban Development with targeted, pro-growth tax benefits, regulatory relief.
- Expands the Low Income Housing Tax Credit by more than 40% to build an additional 180,000 units of affordable housing for working families over the next five years.
- Allows faith-based organizations to qualify for substance abuse prevention and treatment programs on the same basis as other non-profits.
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