Government shutdown creates another delay for Colonial Theatre

LACONIA — The federal government shutdown will cause another delay in restoration of the 104-year-old Colonial Theatre, a project that was first slated to begin on Jan. 1, 2017.

In a recent news release, the Community Development Financial Institutions Fund said the announcement of the next round of allocations for the New Markets Tax Credit Program, originally planned for this winter, will not occur until spring.

“The five-week shutdown requires the CDFI Fund to alter deadlines, and anticipated timelines, for compliance and reporting, awards announcements, and the opening of application rounds,” the release stated.

The New Market tax credits are to provide $5.4 million for the $17 million project and represent the major unresolved piece of financing.

Mayor Ed Engler has told the City Council that an additional city financial commitment of $900,000 will be needed for the project. City councilors are expected to approve that request when it is made in two weeks. This would bring the city’s eventual commitment to the project to $5.1 million.

The New Markets program attracts private capital into low-income areas. Investors receive a credit against their federal income tax in exchange for making investments through community development entities — in this case, Mascoma Bank.

When the U.S. Treasury on Feb. 13, 2018, allocated $3.5 billion in New Markets tax credits, Mascoma was not one of the 73 recipient organizations. A total of 230 groups applied.

This meant the start of the project would be delayed until this year’s round of tax credits were announced. Other delays in the project occurred earlier when plans for the revitalization undershot the costs of the complicated work.

Engler has said Mascoma views it as unlikely that it will be denied the tax credits two years in a row. Also, it has analyzed how its application for the credits was scored in the last allocation and feels its new proposal will be viewed more favorably.

A committee of city officials and members of the board of directors of the Belknap Economic Development Council has been meeting frequently. The Economic Development Council has been organizing the project.

The hope is that the project will attract more people, business and investment in a downtown area where there is more than 100,000 square feet of commercial space for sale or lease.

The economic development council is using a mix of state, federal, city and donor money in the financing package.

Once home to vaudeville shows, the theater became a cinema after World War I. In the 1980s it was divided into a five-screen multiplex, which closed in 2001.