Heartland Health Centers recently achieved a milestone: in seven short years we acquired, financed, constructed and paid off our HHC-Devon community health center.
“In 2014, our leadership team made a forward-looking decision to access tax credits through the beneficial — but complicated — New Markets Tax Credit Program,” says CEO Nicole Willis. “The approach enhanced the community with a brand-new, green health center, made it possible for us to serve more patients, and provided an asset to fuel our continued expansion. We’re grateful to our board and past leaders who made this asset to the community possible.”
Key components to this successful low-interest financing strategy included:
- Forming a special nonprofit whose mission was to acquire, construct and equip the facility
- Acquiring grant and philanthropic support through a capital campaign
- Qualifying for $3.1 million in federal and $1.9 million in state tax credits through the New Market Tax Credit Program
- Applying for and receiving an additional Illinois Capital Grant to support construction
- Paying roughly 1% per year interest for seven years with USBank utilizing the tax credits
- Working with attorneys, USBank and our other partners to retire the debt in June 2021
“In the end, this program provided Heartland Health Centers access to a sizable amount of equity investment into the Devon facility,” says Chief Financial Officer Randall Johnson. “The transaction also provided us with low-interest financing. Although this project had complicated structuring and financials, it was worth it: we have no long-term debt as a result!”
We gratefully acknowledge the following individuals and groups for their leadership and generosity in making this feat possible: Heartland Health Centers’ board of directors, the HHC-Devon Real Estate Board of Directors, Three Corners Development, US Bank and each of our donors.
Retired Heartland Health Centers CEO, Gwenn Rausch, was instrumental in this achievement. “At the time, the organization was less than 10 years old,” Rausch says. “We basically had no, or limited, borrowing capacity on our own. I think it was a real leap of faith… However, I understood that being able to own a sizable piece of property outright would give us something to fall back on in the future. It really has made a difference for Heartland Health Centers and the community.”
Since opening HHC-Devon’s doors in 2014, our team has improved the well-being of our service area with accessible, high-quality health care to its low-income residents. This federally qualified health center has also hired 30 community members.
Located at 1300 W. Devon Ave. in Chicago, HHC-Devon is the only one of our centers to be entirely designed to our specifications. We offer primary health care and mental services at this location. It features 12 exam rooms, a central open-air garden, and community room for group wellness and health education activities. LEED Platinum-certified our green features include a geothermal HVAC system and solar photovoltaic panels.