WISCASSET - Maine has a proud heritage as a rural state that has built its economy on natural resources.
Today, the state continues this tradition and has grown whole new industries from this base. These businesses require capital to expand, evolve and keep pace with market demand.
The New Markets Tax Credit Program has proven to be an important part of that capital flow, and it has allowed Maine to compete in the global economy and to create jobs and opportunities here at home. We need to renew this vital program now more than ever.
Implemented in 2001, the New Markets Tax Credit is a cost-effective way to drive investment in communities with high rates of poverty and unemployment.
The program uses federal tax credits equaling 39 percent of the investment over a seven-year period in exchange for capital to spur economic and community revitalization.
Even in light of the current economic climate, the demand for credits continues to rise, particularly in Maine. The extension of this crucial program, which is currently under consideration by Congress, is integral to our state's economic vitality.
New Markets Tax Credit investments of $15.5 billion have generated a total of $50 billion in capital that has been invested in some of the nation's most underserved communities. Thus far, on average, the NMTC program has generated $12 of private investment for every $1 of federal investment.
In Maine, the program has been equally successful. The state stands fourth in the nation in New Markets Tax Credit funding on a per capita basis.
To date, $180 million in New Markets Tax Credit investments nationwide have spurred nearly $480 million in private investment, largely focusing on rural community economic development.
The program provides much-needed financing for starved small and medium-sized businesses in Maine's hard-hit communities, including traditionally forestry-dependent rural areas such as Millinocket, Grand Lake Stream, Presque Isle and Bangor.
More than 1,500 jobs have been directly preserved or created in Maine through New Markets Tax Credit investments. They indirectly support tens of thousands of additional jobs in the fishing, paper and wood industries, recreational tourism, and related manufacturing, transportation and service sectors.
Nearly 2 million acres of timberland has been committed to sustainable forestry practices, and retained as working forests for traditional mill-supply purposes and additional economic development in recreational tourism and other industries.
Projects include a small-business and affordable housing project in Grand Lake Stream, a community forest, the Gulf of Maine Research Institute in Portland, and most recently, a first round of funding for the Kestrel Aircraft Manufacturing facility on the closed Brunswick Naval Air Station.
Most importantly, each investment meets the triple bottom-line measures for economic progress, social equity and environmental sustainability.
As Maine has built on the success of the program, investors from outside the state have been attracted to projects here. This is private capital, much of it from "away," which otherwise would not have come to Maine. These investments have supported projects crucial to our state's economic growth.
Maine's own Sen. Olympia Snowe has been a pivotal and vital supporter of this program. She and Sen. Jay Rockefeller of West Virginia have sponsored the program legislation since the beginning, including the current extension bill under consideration.
It is Sen. Snowe's vision, with the support of Maine businesses, which has led to the amazing success of the New Markets Tax Credit Program in the state.
Without this leadership, the great story of the New Markets Tax Credit as a successful driver for private capital investment in Maine would not exist.
In fact, according to a Government Accountability Office report, 88 percent of investors surveyed would not have made the investment in these communities without the credits.
We strongly urge a swift vote on the extension of the New Markets Tax Credit Program in Congress to continue the uninterrupted flow of capital investments to the state to help local businesses, create jobs and transform underserved communities in one of the toughest financial climates we have ever seen.