Fosters Daily Democrat
Article published Dec 22, 2010
Somersworth nonprofit gets more time to sell tax credits
Program lets businesses use tax payments for charities
SOMERSWORTH — Avis Goodwin Community Health Center has received an extension until March 31 to sell tax credits to area businesses.
The credits are given to businesses in exchange for donations.
The company was awarded $600,000 in tax credits in late 2009 as a part of a New Hampshire Community Development Finance Authority program. Avis Goodwin originally had until the end of December to raise that amount through donations, and originally secured the credits to use them to ensure the company moves debt-free into its new $6.6 million, 29,000-square-foot facility on Route 108. The facility is due to be completed around May 1.
Company Communications Manager Lara Willard said an extended deadline will give Avis Goodwin a better chance at moving in debt-free because donating businesses now can make a pledge at the beginning of the new year rather than struggling to make one in 2010 because the year’s finances are already tapped out.
“It allows us to make a greater impact on the amount of tax credits we can sell in the community,” she said. “It allows people to go into their fiscal planning for next year and this year. It’s a big decision for an organization to make a sizable donation, and the extension allows them to go more into the planning process for next year.”
A total of $7.9 million was awarded in 2009 through tax credits by the CDFA to 19 state businesses, including $215,000 to the Somersworth-based Malley Farm Boys Home, a nonprofit. The credits let businesses make a contribution to one of the 19 organizations and in turn receive a tax credit worth 75 percent of the amount they pledge.
The credits apply to the business profits, business enterprise, and insurance premium taxes. The donations also can be deducted as a federal charitable contribution, pushing total reimbursement to about 85 percent and ensuring the tax money is invested into the local community, said Avis Goodwin Capital Campaign and Major Gifts Officer Susan Fitzgerald Reichert.
“It’s finally one program that is a win-win for everybody,” she said. “With the CDFA, it’s a win-win for businesses because they pay taxes anyway and can devote their taxes into the community instead of the money just going to the general fund, and they can get 85 percent of their taxes back.”
To date, Avis Goodwin has sold roughly $200,000 in tax credits through donations, which they also have received in exchange for naming rights for parts of the building, according to Willard.
One recent notable donation includes a $25,000 purchase by Federal Savings Bank, which Willard said the bank now can use to get $18,750 in state tax credit and “direct their taxes toward a cause they believe in — providing quality health care for the uninsured and underinsured population in our community.”
Willard said Avis Goodwin expects more donations before the end of the year, and expects to reach out to even more to local businesses at the start of 2011.
The tax credit donation process hasn’t been as smooth for the Malley Farm Boys Home, although Executive Director Mark Sipple said he is “still optimistic” more companies will get interested and the idea will “snowball” once the nonprofit increases awareness of the opportunity and how the credits work.
To date, the home has sold $18,000 of its $215,000 in credits, and Sipple said the reason they are “struggling” is because not many businesses know how the program works and because it’s been difficult getting in touch with larger corporations’ finance administrators, individuals he said are often based in offices in other states and beyond the grasp of small organizations like the home.
Sipple said the home is on a two-year cycle for its credits, and has until June 30 to sell its credits during the first cycle. He said more Web presence will also help his nonprofit sell its credits, which he said will hopefully be used to make capital improvements to the facility and program “to bring it up to the 2011 level.”
More information about the tax credit program is available online at nhcdfa.org. Information about Avis Goodwin’s credits is available by calling Reichert at 516-2556, and information about Malley Farm’s credits is available by calling Sipple at 692-5479.