CEI Capital Management LLC (CCML) Executive Vice President Tad Atwell structures transactions and investments in real estate projects and operating companies using the New Markets Tax Credit (NMTC) program to help attract substantial investment capital into low-income and underserved areas. Since 1992, Tad has primarily focused on underwriting significant commercial banking transactions throughout New England and Nevada. Tad holds a B.A. in English with a concentration in Technical Writing and an M.B.A. from the University of Maine.
Prior to joining CEI, you worked at the Bank of Nevada as its Vice President and Senior Loan officer. What drew you to CCML?
I returned to Maine primarily in order to live closer to my parents who live in Falmouth. At that time, CCML was searching for an investment officer. I was familiar with [CCML CEO] Charlie Spies’ work at the Finance Authority of Maine when I was a commercial banker at various financial institutions in the state between 1992-2005. The chance to work in Maine on complex financial transactions at a national scale and the opportunity to adhere to triple bottom line underwriting parameters drew me to CCML. I was looking for (and found) a career that expanded my commercial banking experience, and equally as important, generated more than just a return to a given bank’s shareholders. CCML and CEI have the enviable position of positively impacting individual lives and entire communities.
What’s a typical day like for you at CCML?
There is no such thing as a “typical day” at CCML, which helps keep me thoroughly engaged on a day-to-day basis. I may be speaking and interacting with senior officers at large money centers or community banks, senior officers of potential project sponsors or developers, tax or real estate attorneys, executive directors of not-for-profit entities, and/or individuals with a dream–who believe that NMTC may play some role in achieving it. No NMTC transaction is the same. However, the flexibility allowed by the statute and deal structure also play a role in the complexity of a NMTC transaction. Other day-to-day responsibilities include fostering investor relations, conducting financial and credit analysis, structuring NMTC transactions, and responding to general programmatic inquiries.
Can you describe the process for creating the community benefit agreements (CBAs) for the NMTC deals?
The process begins with CCML investment staff reviewing the project sponsor’s application, business plan, pro-forma financial statements, etc., in order to identify and understand the contemplated benefits or impacts to an underlying low-income community–and the needs or requirements of the underlying low-income community. Direct, quality, permanent job creation and/or preservation are paramount to the NMTC program. In certain instances, the quality and quantity of the projected direct job creation may be deemed to provide sufficient community benefit, relative to the amount of NMTC allocation requested, given the facts and circumstances of that specific underlying community. If projected job creation/preservation is deemed insufficient in and of itself, but the project still merits NMTC allocation for other reasons, then CCML endeavors to identify key community benefits mutual to both the project sponsor and the underlying low-income community. Then negotiation ensues between the project sponsor, CCML and the NMTC equity investor (particularly if the CBA may impact compliance with the NMTC program) to arrive at terms and conditions that are satisfactory to the parties. Past examples include reserving or “carving out” some percentage of the subsidy created by the sale of CCML’s NMTC allocation to capitalize a revolving loan fund, a tuition reimbursement plan, and/or an employee training program.
In your opinion, what’s the single greatest benefit the NMTC program brings to communities?
The creation and/or preservation of direct, quality, permanent jobs in low-income communities that otherwise may not have benefited from such capital investment.