Laura Ashley: Deliberate and Emergent Strategies

Laura Ashley: Deliberate and Emergent Strategies Laura Ashley home furnishing and fashion is a popular store all over the world. This company has come a long way since Laura herself and Bernard Ashley had started their company by producing headscarves, tablemats and napkins for their kitchen tables in the 1950s. Twenty years later in the 1970s Laura and her husband made an investment, they started the company they first produced a dress for social occasion, this was their breakthrough and the sales increased and by then there were many stores open on different parts of the world. The company continued to expand worldwide and flourished throughout the 1980s. However it was one fatal day that Laura Ashley had fallen downstairs on her 60th birthday and died, this upset to the company only got worse after the incident and problems started to occur. Due to the fashion industry changing so rapidly and the fashion provided by Laura was soon replaced by casualness in comparison to the formality fashion the company offered. The company was left behind as it didnt adapt to the changes and didnt size up to the upcoming competition. Laura Ashley deteriorating performances lead to reaching out for help by getting a different CEO in place to help set the company on the right track. The company had up to 5 different CEOs from the dates of 1991-1999 and each one had their own strategies and views on how to run the company. Laura Ashley overall is an unlikely business success story and has gone through a lot and is now currently back to its roots of Kitchen tables covers but also taps in the current fashion industry and not as formal as before. 1. Map Laura Ashleys stakeholders using a power/interest matrix Stakeholders are those individuals or groups that have a part in the company (Hill Jones, 1995, pg 45). Mapping stakeholders is a strategic business tool that identifies and assesses the different effects of individual or group of stakeholders on a company. The power and interest matrix identifies which stakeholders play a vital part in the company and examines the power they have and their likelihood to use that power. ( G. Johnson K. Scholes, Exploring Corporate Strategy, Financial Times/Prentice Hall, 2002.) By examining the key stakeholder of Laura Ashley we will be able to identify who we should mainly concentrate on. The stakeholders matrix consists of four sections and is divided up accordingly to group A, group B, group C and group D. Group A is (Minimal Efforts) this group needs to be monitored but you do not need to actually provide these people with a lot of information. Group B on the other hand needs to be kept informed. Here you will need to keep the people sufficiently informed and you must ensure that you communicate with them in order to ensure that no problems or other issues may arise. These people are often very helpful to the company with regards to having some details about what you are doing. Group C you must ensure you keep them satisfied. In this situation the company needs to ensure that the people are kept satisfied, the actual difference here in comparison to the first group is that these people are not as interested in using their power. Group D are your key players and these are the people that you must fully engage with and you must ensure that you make the greatest efforts in satisfying them. Your position on the grid below shows you the actions that you must make when it comes to them (Rachel Thompson) Firstly the managers in Laura Ashleys are Laura Ashley herself and her husband Barnard Ashley. Together they are responsible for the overall running operations on the business and they compile different strategies in order for the company to be successful and then ensure that the strategies are implemented. Therefore Laura and her husband have very high levels of interest in the business as they have invested their own money in the company. Laura and her husband Barnard also have a high level of power as they decided on the effort levels of employees therefore they will both be classified as Key Players. The four board directors appointed by MUI also fall under Group A as they have a high level of power on the operations of the business and a high level of interest on the success of the business. The Shareholders of Laura Ashleys have both got high levels of interest and a high level of power therefore also putting them in Group D which is the Key players. According to the case Laura Ashleys shareholders, Malayan United Industries, showed their power by appointing four board members. Dr Khoo Kay Pen is the chair person of MUI and the reason why they have this power is because they had 40% of the chain. The fact they were so involved shows that they had a high level of interest in the success of the business. They showed this by opening new product lines and creating a sense of direction for the firm to further expand. Therefore this particular shareholder need to be kept informed and involved. Although Laura Ashley has other shareholders they dont necessarily have the high level of power that MUI does but they do still have a high level of interested in the business therefore putting them under group B, keeping informed. The reason why they might not have the same level of power to the other shareholder is because they do not have as much shares in the company therefore limiting them to have power to make or implement changes in the company. The Employees of Laura Ashleys are not really in title to high level of power but they do have a high level of interest in the company success. This is because they are concerned with the security of their job and they want to be kept informed on the future of the business and whether or not they will have an income and a job the next day. Therefore the employees of Laura Ashley fit under Group B, Keep Informed. The Distributors and suppliers of Laura Ashley are considered to have a high level of power but low interest levels making them fall under Group C, Keep Satisfied. The distributors and suppliers have high level of power because Laura Ashley is dependent on them making them more in control as they are the once supplying the company with the goods and without them Laura Ashley wouldnt have her quality products. The Distributors and suppliers do not have interest in the business itself just as long as they get paid on time. Customers of Laura Ashley are more concerned with the services they receive and the quality of the products that they purchase. Therefore the customers have a low level of interest in the business running. On the other hand the customers do have a high level of power in terms of deciding if they will be buying your product or not and without your customers Laura Ashley would not have business therefore the customers must be kept satisfied. The customers fall under group C and need to be provided with good services to keep them coming back. The Government plays a vital role in the business operations of Laura Ashley. They implement and increase or decrease tax. Therefore they have power over all businesses when it comes to influencing prices and how the company obeys certain policies that they draw up. The Government has a low level of interest the business itself as long as they pay tax and run their business according to the policies. Therefore the government fits in Group C, keep satisfied. Peel Hunt, the investment bank, would fall under Group A as they would be interest in the companys financial position and they have the power to close the business if the business is making a loss or is not operating according to how they planned. David Cook would be part of Group B as he is the financial director for Laura Ashley and has a high level of interest as an employee and he ensures that the company is financially sound. David Cook does not have a high level of power that influences the business. The Competitors that are competing against Laura Ashley have a high level of power in the sense of offering better services or prices that might impact how Laura Ashley might operate. The competitors might have power over the suppliers and distributors and therefore can be seen as a threat. Therefore it is important for Laura Ashley to be better than the competitors. The competitors also have a high level of interest on the business as they want to be better than Laura Ashley. The Media also plays a part in the power/interest matrix. Tamasin Doe, the director of a fashion magazine would fall under Group B, keep informed. The magazine would be helping the company in promoting their collection. Therefore they need to be kept informed on what is happening within the company and the collection. The magazine has a high level of interest in the business but low level of power or the operations of the business. 2. How would you characterize Laura Ashleys Core Values? Core Values is essential for an organization as it sets guiding principles for the company. Your companys core values should not be confused with cultural practices or operating practices and it should not be comprised of the companys financial gains or short term expediency (Johnson, Schole Whittington, pg 163). Values are seen as a life directing guideline that helps underline the behavior expected. (Trice Beyer 1984) Laura Ashleys core values revolve around their brand, diversification, employees and their customers satisfaction. Laura Ashley value for diversity allowed a much broader employee commitment and it will attract more employees. By getting the employees committed will help guide their decisions and behaviours. This will be shown and discussed accordingly in the paragraphs below. The Core Value of Laura Ashley was founded in the 1950s when Laura and her husband started making basic material accessories in their apartment. Hard work and dedication was the reason why they are so successful today. With dedication and a vision Laura and her husband had the right attitude and passion to become successful business owners. Their value of staying true to who they were and offering the same quality products over the years is also another indication of how dedicated and passionate they were about what they were offering a quality brand to their customers. The attitude that Laura had helped direct her behavior in the sense of how she put everything she could to ensure that the products were of good quality and with this good work ethics Laura was able to guide her organization strategy to be successful. When Laura Ashley died her company carried on but with the same values that she had created and this helped the organization stay close to the roots of Laura Ashley and the vision on where she wanted the business to be. Laura Ashleys kept up to date with the latest trends and made their line inspirational an unique. Therefore they created the value around their brand and ensured that it kept up with the latest trends and fashion apple to the customers. The idea of attaching Laura Ashleys name to the brand was to help customers identify the real quality provided as she uses her own name. This shows that they were positive in their products quality. Laura Ashley was able to personalize and self express with her products which is what added value to the customers. After all the company has gone through such as expansion and numerous of different managers, Laura Ashleys core values remained. The brand heritage was based meaning that it was accessible and it had good designs that were realistically priced. The fact that the brand was so well established it left the customers to have a sense of trust in the quality products that is provided. Laura Ashley lives up to their promises which shows integrity. Laura Ashley identified and develop a clearer, concise and a shared meaning of values and direction because of all the changes they have gone through the employees had to adapt to each new chief executives ways and this could have caused some confusion if the value was not understood. Values help guide the employees in their decision making and this can help with the services to the customers and result in customers satisfaction. (Trice Beyer 1984) These core values identifies exactly what Laura Ashley is all about. They concentrate on the quality brands and ensure that they achieve customer satisfaction. Core Values have helped the company survive and it has helped them stay true to the roots that Laura Ashley herself created. Therefore the core values are very important within a business and it helped identify the business. 3. Recommend a new Mission statement/or Vision Statement for Laura Ashley. A mission Statement defines the purpose of an organization and their primary objectives. A mission statement is developed to define the key measures to a business success. (Angela Schnaubelt Aug 1, 2007) Your mission statement will help an organization have a precise direction about what you plan on doing and where you are going in the future. (Angela Schnaubelt Aug 1, 2007) A Vision Statement is your ticket to success and is like an image in words of your companys future, like a mission statement it also defines the purpose of the organisation but in terms of the organisations values. (Susan Ward, About.com Guide) The statement provides inspiration for both the companys daily operations and strategic decision making. In other words without a clear vision statement it would be impossible to have effective business planning. (Susan Ward, About.com Guide) A Vision Statement provides the company and the employees a sense of direction and a plan on how to get there in order to accomplish the business goals. (Susan Ward, About.com Guide) Laura Ashleys new mission statement will ensure that everyone will feel drawn to and feel more a part of the business and respect the values. I would recommend that the mission statement should be edited as follows: Laura Ashleys wants to establish relationships with those who share a love of the lifestyle that Laura Ashley herself did. Laura Ashleys act to protect those relationships formed and wants to ensure that the relationships are prosperous and long-term. With highly respectable and knowledgeable employees, Laura Ashley can provide the customers with good sales services and help customers find their individuality. The vision of Laura Ashley had changed numerous of times due to the fact that when a new chief executive came they saw different ways to make Laura Ashley a success and each one had their own mind set on how they were going to achieve that. Therefore I would recommend that Laura Ashleys vision statement should be fixed no matter who the chief executive is as this will ensure that the employees dont get confused with what they must accomplish. Today Laura Ashley is in a strong position with 450 stores around the world and is well situated for further expansion. (Lillian Tan, Chief Executive Officer of Laura Ashley in 2005). I would recommend that Laura Ashleys vision statement should be as follows: We want Laura Ashleys to be a place We want Laura Ashleys to be a place where the customers can come and feel welcome and have a good time shopping and finding their individuality. From the moment our customers walk in our store they will be greeted by a warm atmosphere, subtle music and friendly staff. I envisions that Laura Ashley been a leading individual store that provides customers with variety of products and fashion that ensures individuality for each customer. By changing both the mission statement and vision statement for Laura Ashley will be a new adventure for them. The fact that Laura Ashley went back to its roots it would only be wise to change them both and ensure that the employees understand where the company is going and what they should to help it get there. 4. To what extent was Laura Ashleys strategy development emergent or deliberate? A deliberate strategy is more of a desired strategy that is deliberately formulated or planned by the managers. Its associated with the use of tools, techniques and frameworks for strategic analysis and evaluation. (G. Johnson, K. Scholes, R. Whittington) Deliberate strategy involves a 6 step process namely: 1 Environmental Analysis, 2 Goal Setting, 3 Strategy Formulation, 4 Strategy Implementation, 5 Evaluation/Control, 6 Feedback. (G. Johnson, K. Scholes, R. Whittington) An Emergent strategy on the other hand comes about through everyday routines, activities and processes in organisations leading to decisions that become a long-term direction of an organisation. (G. Johnson, K. Scholes, R. Whittington) An emergent strategy is a pattern of action that develops over time in an organization in the absence of a specific mission and goals, or despite a mission and goals. (D. J. Power,ÂÂ  Alexander P. and Daniel J.,ÂÂ  Planning ) Within 14 years Laura Ashleys had up to 11 different CEOs and each one had a different strategy that they implemented. Due to the companys plans and brand investment strategy that was implemented across the fashion and home furnishing department. Laura Ashleys brand became well known and standards were set for good quality product and this deliberate strategy evolved in customer loyalty. On the other hand Laura Ashleys strategy was also an emergent strategy. It was stated that they went into the market by been a home furnishing but the break though came about when Laura Ashley produced a dress for social occasion. At the time Laura Ashley made and emergent strategy to start tapping into the fashion industry. This emergent strategy made the success of the company. Laura Ashleys strategy was deliberate. Laura Ashley ensured that her strategy was to get her brand well known and recognized by the customers and potential customers. By using this strategy Laura Ashley knew she could concentrate on differentiating her products from her competitors as she wanted to put value to her brand. Laura Ashley did this to gain customer loyalty therefore she made the brand the central part of Lauras strategy. Laura Ashley herself planned a strategy that would ensure her brand would be a success. Laura and her husband did environment analysis to see if there was indeed a market. Though the years of operation things drastically changed. After the death of Laura the strategy was still in place but was forced to be emergent at times due to the changes in the environment. When Ann Iverson was selected to be chief executive she made a emergent strategy to expand Laura Ashleys overseas and she tried to appeal to the younger customers in the UK. This strategy that Iverson implemented at the end of the day becomes trouble because there were not enough products to fill each of these huge stores. This could have been a result of not carefully planning. Therefore another emergent strategy had to be put in place. The emergent strategy was to let Ann Iverson go and to put a rescue team in place. This emergent strategy left Laura Ashley having a lifeline, their major shareholder Malayan United Industries (MUI). MUI purchased 40 per cent of Laura Ashley. MUI then came up with a deliberate strategy to appoint four new boards of directors and this resulted in giving Laura Ashley some stability that they needed. MUI implemented many emergent strategies to get Laura Ashleys pack on track, they even closed down some stores that were unprofitable and closed those stores thats rented was too high. This strategy was to ensure that the expenses of Laura Ashley didnt exceed the money coming in. The overall strategy was to modernize the brand but at the same time to remain true to Laura Ashleys brand values, this strategy is emergent as well for the simple fact that it wasnt necessary to go through a long process that is time consuming. Laura Ashleys did not have the time to waste and needed to act fast due to the changes in the environment and due to the changes within the company itself. The one part of Laura Ashley that was deliberate was when they relocated the poorer performing stores from the prime areas to the larger off-pitch stores. This was deliberate as they intended to save money and costs. They had to do environmental analysis to identify the stores that were not doing so well and when they identified these stores they had to set goals in order to ensure that they dont lose any more money. By setting a goal that want to move the unprofitable stores they were deliberately planning to ensure the Laura Ashley succeeds. The next step they took was setting the strategy to actually take the unprofitable stores and move them to larger stores that were off the prime areas, this strategy was implemented for the simple fact of not having a store that is not doing well in you important areas as it could have damaged the brand image. In total this case study of Laura Ashley had deliberate and emergent strategies implemented. Due to the fact that Laura Ashley was a fragile company it was important that they did implement more of the emergent strategies as they had so many CEOs and people running the company that did change business runnings, some good and some bad. With emergent strategies it allowed them to take the opportunities they saw quickly and turn them into a success. CONCLUSION: Laura Ashleys is a business that included product development in order to satisfy the needs or the target customers though focusing on the signature brand offered. Laura Ashleys main strategy evolved around the product brand. The brand strategy provided the company with a solid base as to know that the products must always be high quality as it is the face of the business. Laura Ashleys is a rare success story and is surely an inspiration to many other companies that have grown to international status. The company has succeed for the reason that it was always looking for ways to improve their services and to improve their operations in order to increase customer services and to expand the business globally. The home furnishing offered by Laura Ashley played a major part in building the brand to be recognised, this was because they put extra value to their customers and provided them with quality goods. The company has come a long way since Laura and her husband Bernard started printing fabric on their kitchen table in London. Due to their investment in what they considered would be successfully turned out to be true, as sales increased and the company kept on growing as well. Laura Ashley had a clear brand strategy and when Laura herself was managing things she had a clear vision of wanting to be able to provide quality products to her customers and build long term relationships with them in order to ensure that they will come back. Lauras vision was to be able to also share a common interest with her customers and ensure customer satisfaction by providing excellent services. Harvard Referencing: G. Johnson K. Scholes, Exploring Corporate Strategy, Financial Times/Prentice Hall, 2002 page 30, 134, 156, 401-402, 407-408 D. J. Power, Alexander P. and Daniel J., Planning Skills .COMsm Susan Ward, About.com Guide Lillian Tan, Chief Executive Officer of Laura Ashley in 2005 Angela Schnaubelt 1 AUGUST 2007 Trice, H Beyer, J 1984, Studding Organizational Cultures through Rites and Ceremonies, Academy of Management review 9, no 4:655 C. Hill G. Jones, 1995, Strategic Management: an integrated approach, third edition, pg 45

A Comparison of T. Thomas Fortune and Booker T. Washington

Alex Roth White Power/Black Leadership November 14, 2007 Booker T. Washington and T. Thomas Fortune Though not as well known today as many of his contemporaries, T. Thomas Fortune was the foremost African American journalist of the late nineteenth and early twentieth centuries. Using his editorial position at a series of black newspapers in New York City, Fortune established himself as a leading spokesman and defender of the rights of African Americans in both the South and the North (wikipedia). The life of T Thomas Fortune spanned several significant periods in American history. His seventy-two years included the experiences of slavery, Reconstruction, â€Å"the Nadir,† and the Harlem Renaissance. In varying degrees, these opposing periods in time influenced and determined the direction of Fortune's life and the realization if his identity as an â€Å"Afro-American. † On the other hand, one of the most influential, celebrated, and criticized black leaders of the twentieth century was Booker T. Washington. Few public figures in African American life during the period of post-slavery excited as much passion and misunderstanding as Washington. Born a slave and deprived of any early education, he became America’s foremost black educator of the late 1890s and early 1900s, introducing the nation to his own brand of education and reform for the post-Civil War United States. Besides using his journalistic pulpit to demand equal economic opportunity for blacks and equal protection under the law, T. Thomas Fortune founded the Afro-American League, an equal rights organization that preceded the Niagara Movement and the National Association for the Advancement of Colored People (NAACP), to extend this battle into the political arena (Thornbrough). However, his great hopes for the league never materialized, and he gradually began to abandon his militant position in favor of educator/activist Booker T. Washington's compromising, accommodationist stance (Thornbrough). Fortune's later years, wracked by alcohol abuse, depression, and poverty, precipitated a decline in his once-prominent reputation as well. Washington’s career, on the other hand, was no less successful or influential than that of Fortune’s. He was the founder, first teacher, and principal of the Tuskegee Institute in Tuskegee, Alabama, which later became the staple for almost all southern black education. Here Washington instituted his belief in vocational training as a means for black self-reliance, as well as a way to further the black community through providing services people of all races could benefit from (Washington). He became a well-known orator throughout his career, wrote a best-selling autobiography (Up From Slavery, 1901), and advised Presidents Theodore Roosevelt and William Taft on race relations in the United States. Later in his life Washington was given the nickname of â€Å"The Great Accommodator† which provides an indication of why later black influences, such as W. E. B. Du Bois and the N. A. A. C. P. so heavily criticized his leadership (Du Bois). Washington was the driving force behind the Tuskegee machine from 1891 until his death in 1915, constantly controlling every operation that occurred at the school. Together these two men helped to shape the landscape of the black community for years after their deaths and as will be shown when their paths crossed during the courses of their lives, sparks flew, tempers flared, and the history of Black America was changed forever. Timothy Thomas Fortune was born a slave in Marianna, Florida on October 3, 1858 (Thornbrough 3). Early in his boyhood he was exposed to the three factors that later dominated his life – journalism, white racism, and politics. Fortune was only five years old when slavery was abolished in 1863 by the Emancipation Proclamation. His father, Emanuel Fortune, was a literate slave artisan and one of two African Americans elected as delegates to the 1868 state's constitutional convention and a member of the Florida House of Representatives, and his mother, Sarah Jane Moore, was a slave. Fortune was raised amid tumultuous times in Reconstruction Florida (12). Southern whites, resentful of black political participation, intimidated blacks through acts of violence; Jackson County, the Fortunes' hometown, witnessed some of the worst examples. The Fortune family escaped with their lives, losing their home and profitable farm as they were forced to emigrate to Jacksonville, Florida to start a new life (23). . The young Fortune obtained his education in Florida through a variety of avenues both formal and informal. While in Marianna and Jacksonville he attended Freedmen's Bureau schools and picked up knowledge of the printer's trade from observation in the office of the Marianna Courier (wikipedia). This printing shop was the first of several in which T. Thomas Fortune worked and learned the trade. At the age of thirteen he began his political apprenticeship in Tallahassee, Florida where he was a page in the State Senate and learned first-hand about political corruption and the exploitation of blacks by whites in politics. Fortune's distrust of political parties and his attitude toward race relations were influenced greatly by his teen years in the State Capitol (Thornbrough 34). He also preferred to spend his time hanging around the offices of various local newspapers rather than in school. As a result, he left Florida in 1876 at the age of 19 and enrolled at Howard University during the winter 1874 term to study law. He changed to journalism after two semesters, but a lack of money limited his stay at Howard (40). While enrolled at school he spent part of his time working in the print shop of the People's Advocate, an early black newspaper, where his love of journalism flourished. In 1877 while still in Washington D. C. , Fortune married his long-time sweetheart from Florida, Carrie Smiley (wikipedia). For the next two years he taught school in Florida and worked for the Jacksonville Daily Union as a printer. In 1878 Fortune traveled to New York, where he was hired to the staff of the New York Sun, eventually working his way up to the editorial staff as those around him began to recognize his incredible abilities as a writer and journalist (Thornbrough). A few years later in 1881 Fortune, along with George Parker and Walter Sampson began the newspaper the New York Globe, where Fortune soon became the editor. The New York Globe and its successors, the New York Freeman in 1884 and the New York Age in 1887, would establish Fortune as the head of black journalists (50). One of the reasons that these papers were so successful was their high literary quality and relentless editing by Fortune. At this time he began to establish himself as a leading voice in the fight against American racism and wrote several editorials that argued for equal treatment and protection of the black community. Under his leadership, the New York Globe and its predecessors were regarded as the most distinguished Afro-American papers in the nation (wikipedia). While editor of the New York Globe, Fortune attacked Republicans for not caring â€Å"a snap of the finger† for Negroes and he called upon blacks to form a â€Å"new honest party. Unlike most African Americans of his era, he felt no special affinity or loyalty fort the Republican Party (Fortune). While most black leaders and black newspapers felt an allegiance to the party of Abraham Lincoln, Fortune denounced the Compromise of 1877, when the Republicans ended Reconstruction and sacrificed the constitutional righ ts of southern blacks. He believed that the period of Reconstruction had not sufficiently given the black community an opportunity to establish a base for their future in this country (93). Fortune’s ability to mobilize the black population through the press and other political actions created a desire for the creation of an Afro-American League (Thornbrough). In December of 1889, more than one hundred delegates from twenty-three states met in Chicago to organize the league. The group’s goal was to attain full citizenship and equality for the black community. However, after much effort to organize chapters and raise funds, the league failed, but paved the way for others, such as the Niagara Movement and the N. A. A. C. P. , which is still in action to this day (67). In 1895, the prominent black leader Frederick Douglass died, making Fortune the most well-known militant black spokesperson in the North. However, this came at the price of Republican funding, since Fortune was an independent political thinker, effectively putting his newspapers into financial crisis and forcing him to depend on Booker T. Washington for small sums of money (wikipedia). At this point in their lives both Fortune and Washington were at the peaks of their influential campaigns, trying to make a difference for the black community. I would now like to talk about the background of our other black leader, Booker T. Washington, in order for the reader to get a sense of his upbringing and beliefs before the pair is compared. Booker Taliaferro Washington was born in 1856 on a slave plantation in Virginia (Washington 7). He was about ten years old when in 1865 the Union defeated the Rebels, ending the Civil War and essentially freeing the southern slaves. Soon after this Washington’s family settled in West Virginia. This is the time in Booker’s life when he began to have a thirst for learning, so he asked his mother for a Webster’s â€Å"blue back† spelling book, which put him on the track to greatness (18). Washington one day overheard discussion of a school for blacks called Hampton Institute, and he promptly determined that he would seek a formal education there. Before going to Hampton, Washington worked for a second time in the home of a white family, in this case as a houseboy for General Lewis Ruffner and his wife, Viola, owners of the local mines (Washington 24). Here he learned the importance of strict discipline and form, something that he took with him for the rest of his life and readily applied to his everyday endeavors. In 1872 he set out for Hampton Institute. When his money gave out, he worked at odd jobs. Sleeping under wooden sidewalks, begging rides, and walking, he traveled the remaining 80 miles and asked for admission and assistance (26). After Hampton officials tested him by having him clean a room, he was admitted and given work as a janitor. This is when Booker was noticed for his diligence, hard work, and attention to detail, all characteristics that he emphasized in every aspect of his life. Hampton Institute, founded in 1868 by a former Union general, emphasized manual training. The students learned useful trades and earned their way. Washington studied brick masonry along with collegiate courses. Graduating in 1876, he taught in a rural school for two years (40). Studying at Wayland Seminary in Washington, D. C. , he became disenchanted with classical education, considering his fellow students to be dandies more interested in making an impression and living off the black masses than in serving mankind. He became convinced that practical, manual training in rural skills and crafts would save his race, not higher learning divorced from the reality of the black man's downtrodden existence. In 1879 he was invited to teach at Hampton Institute, particularly to supervise 100 Native Americans admitted experimentally (Washington 47). He proved a great success in his two years on the faculty. In 1881 citizens in Tuskegee, Alabama, asked Hampton's president to recommend a white man to head their new black college; he suggested Washington instead. The school had an annual legislative appropriation of $2, 000 for salaries, but no campus, buildings, pupils, or staff (Washington 51). Washington had to recruit pupils and teachers and raise money for land, buildings, and equipment. Under Washington's leadership (1881-1915), Tuskegee Institute became an important force in black education. Tuskegee pioneered in agricultural extension, sending out demonstration wagons that brought better methods to farmers and sharecroppers. Graduates founded numerous â€Å"little Tuskegees (wikipedia). † African Americans mired in the poverty and degradation of cotton sharecropping improved their farming techniques, income, and living conditions. Washington urged them to become capitalists, founding the National Negro Business League in 1900. By 1915 Tuskegee had 1, 500 students and a larger endowment than any other black institution (wikipedia). At this point in Washington’s journey he begins to kindle a friendship with a black journalist from New York named T. Thomas Fortune. Washington and Fortune seemingly made strange friends. Apparent opposites – the former a soft-spoken accommodationist and the latter a militant agitator – in actuality, they were very good friends who corresponded almost daily throughout the 1890s. Their relationship was based on mutual affection, mutual self-interest, similar backgrounds, and the same ultimate goals for people of color (Thornbough). Born as slaves in the same year and growing up in the Reconstruction South, both men felt a deep obligation to their native region and a duty to improve the condition of southern blacks. Washington provided a model for the black community after his own life. He believed that blacks should work their way from the bottom up because that is where they stood in the first place. He proclaimed that there was honor, duty, and merit to be found in performing challenging, hard work (Washington 37-38). At Tuskegee Booker reinforced the fact that blacks should not feel undignified about taking part in manual labor, but instead learn to love it. Washington also emphasized the importance of personal hygiene to each of his students, stating that â€Å"Absolute cleanliness of the body has been insisted upon from the first. (Washington 81). This belief stemmed from the thought that being presentable and personally responsible for one’s appearance would lead to a more civilized environment for all men and women (80). He believed that to do something that the world needed was the greatest way to earn merit and become rewarded in society. He also believed that blacks should become economically viable before attempting any ventures into politics. Washington stated that black rights would come at a slow and steady pace and that blacks should wait before becoming involved with political affairs (Washington 85). This accomodationist attitude was not favored by many in the black community, including Fortune’s militant beliefs of agitation. Booker’s motto was â€Å"hand, head, and heart,† meaning that that all things should start through the dignified duties of performing tasks the world needs done (42). He believed in an industrial education where his students were prepared for the real world and able to make a contribution not only to themselves, but the black community as a whole. Like Washington, Fortune emphasized the importance of education and believed that practical vocational training was the immediate educational need for blacks as they emerged from slavery (wikipedia). He, too, counseled success through thrift, hard work, and the acquisition of land, believing that education and economic progress were necessary before blacks could attain full citizenship rights. Although the two leaders played different roles and presented contrasting public images, their alliance was mutually useful. Fortune was editor of the leading black newspaper, and Washington needed the Age to present and defend his ideas and methods. Fortune also helped edit Washington's speeches and was the ghostwriter for books and articles appearing under his name, including A New Negro for a New Century and The Negro in Business (Thornbrough). Similarly, as Washington's reputation and influence grew, particularly in Republican circles, he could be a powerful friend. For years he secretly subsidized the Age, helping to keep it solvent. Fortune hoped for Washington's intercession with President Theodore Roosevelt for a permanent political appointment, but all he received was a temporary mission to the Philippines in 1903 (wikipedia). Fortune's dependency on Washington continued to grow. He bought an expensive house, Maple Hill, in Red Bank, New Jersey, in 1901. Its mortgage payments, added to the financial woes of the Age, compounded his monetary problems. As attacks mounted on Washington for his accommodationist methods, Fortune felt compelled to defend his friend. But Washington's more militant black critics, notably W. E. B. Du Bois and the leaders of the 1905 Niagara Movement, simply denounced Fortune as an untrustworthy, former â€Å"Afro-American agitator (Du Bois 69). A new generation of black leaders was appearing, and Fortune's influence was beginning to wane. He broke with Washington and joined members of the Niagara Group in criticizing President Roosevelt's discharge of black troops following a riot in Brownsville, Texas, in 1906. Needing Washington's support though ideologically drawn to his detractors, Fortune faced a crossroads: his life began to disintegrate. Disillusioned and discouraged after h is long efforts on behalf of black America, he separated from his wife, increased his heavy drinking, and suffered what his contemporaries described as a nervous breakdown (Thornbrough). Washington took control of the Age in 1907 by becoming one of the principal stockholders. Later that year Fortune sold his interest in the paper to Fred R. Moore, who became the new editor. This effectively ended Fortune's influence as a black leader. From time to time he found work as an editorial writer and correspondent for the Age and the Amsterdam News. He edited the Washington Sun for a few months before it folded (Thornbrough). Slowly he recovered and in 1919 he joined the staff of the Norfolk Journal and Guide, continuing to write commentaries and editorials for the rest of his life. He became editor of Negro World, black nationalist leader Marcus Garvey's publication, in 1923, remaining there until his death in 1928, but not before the pioneer activist had joined the ranks of Washington's critics, apologized for his ideological waywardness, and observed that â€Å"all along the way I have shaken the trees and others have gathered the fruit (Fortune). † Many critics agree that it was all but impossible for anyone to achieve the ambitious goals Fortune had set given the climate of the times in which he lived. When he abandoned his militant ideology to promote Washington's more accommodationist methods, Fortune destroyed his own credibility as a leader and his personal integrity as well. This was something he could not live with, and it seemed to destroy him. As Emma Lou Thornbrough wrote in her biography T. Thomas Fortune: Militant Journalist, â€Å"Unable to bend as Washington had, he was broken. Before he was thirty years old Timothy Thomas Fortune was widely acclaimed as the most able and influential black journalist of his times and was seen by some as a possible successor to Frederick Douglass. As an editor in New York toward the end of the nineteenth century, he sought to use the press as a vehicle for mobilizing black public opinion to support his militant ideology and for establishing himself as spokesman for and defender of the rights of Afro-Americans in the South as well as in the North. He viewed political action as necessary for achieving his ideological goals as well as an instrument for fulfilling his own personal aspirations. He also conceived of a national organization as a means of carrying out his aims and led in the formation of the National Afro-American League. His political ambitions were thwarted as were his hopes for the League, and in later years his reputation as a militant and uncompromising champion of the rights of blacks was compromised by his ties with Booker T. Washington, with whom his career became inextricably linked. This seeming paradoxical relationship between the two men grew out of the interest that each had in furthering his own career as well as out of mutual respect and affection. But as Washington's prestige and power grew, Fortune's influence and reputation declined (19). Although outwardly conciliatory, Washington secretly financed and encouraged attempts and lawsuits to block southern moves to disfranchise and segregate blacks. He had lost two wives by death and married a third time in 1893. His death on Nov. 14, 1915, cleared the way for blacks to return to Douglass's tactics of agitating for equal political, social, and economic rights (wikipedia). In 1895 Washington gave his famous â€Å"Atlanta Compromise† speech (Washington 99). Although he shared the late Frederick Douglass's long-range goals of equality and integration, Washington renounced agitation and protest tactics. He urged blacks to subordinate demands for political and social rights, concentrating instead on improving job skills and usefulness. â€Å"The opportunity to earn a dollar in a factory just now is worth infinitely more than the opportunity to spend a dollar in an opera-house,† he said (101). He appealed to white people to rely on loyal, proven black workers, pointing out that the South would advance to the degree that blacks were allowed to secure education and become productive. Washington's position so pleased whites, North and South, that they made him the new black spokesman. He became powerful, having the deciding voice in Federal appointments of African Americans and in philanthropic grants to black institutions (wikipedia). Through subsidies or secret partnerships, he controlled black newspapers, stifling critics. Overawed by his power and hoping his tactics would work, many blacks went along. However, increasingly during his last years, such black intellectuals as W. E. B. Du Bois, John Hope, and William Monroe Trotter denounced his surrender of civil rights and his stressing of training in crafts, some obsolete, to the neglect of liberal education (Du Bois 73). Opposition centered in the Niagara Movement, founded in 1905, and the National Association for the Advancement of Colored People, which succeeded it in 1910. In the Atlanta Exposition speech Booker speaks of the progress of the black community ahs made since the end of the Civil War. He had created the Negro Business League, where black businesses were able to get money and become established through the aid of other black businesses. He also stated his theory of education needing to be industrial, so that young blacks could become independent by providing services the world needs. However, this progress seemed to be tainted because there was very little room for growth, especially in industry and politics. Here it is said that Booker became known as an accomodationist. He made statements during the speech that lead others in the black community to criticize his leadership and future goals of the race as a whole. He said that blacks got as much out of slavery as whites, meaning that they had skills others did not possess (Washington 14). He also stated that he opposed slavery, but was not bitter about the entire nation under this hierarchal control. He thought that blacks should not ask for many rights or privileges because he did not want to annoy them. This view differed completing from those of T. Thomas Fortune because he believed in a more militant approach to the gaining of political and social rights (Bracey et. al. 213) . In â€Å"We Know Our Rights and Have the Courage to Defend Them† he presents a black nationalist view of the United States after the Civil War and Reconstruction (Bracey et. l. 213) . Booker also shared in this view, stating the â€Å"we are a nation within a nation,† although many educated blacks wanted to be seen as Americans. In this writing, Fortune wanted to press the case for black rights, sharing a spirit of agitation with the black community, something that differed heavily from the teachings of Washington (214). Fortune wanted to stir things up by challenging blacks to have manhood and to stand up to white prejudice that they witnessed in their everyday lives, coming up with an actual program to aid this progress (217). First, he represses voter intimidation of the blacks in the South. Second, he discourages the reign of the lynch and mob laws. And third, he discusses the unequal distribution of school funds to black educational endeavors, such as the Tuskegee Institute. Fortune believed that many of these issues were worth fighting for and if the black community could act in solidarity they would eventually achieve their goals (Bracey et. al. 218). The relationship between Fortune and Washington was, to say the least, a tumultuous one, riddled with disagreements and hardships. T. Thomas Fortune was much more outspoken and militant than was his friend Washington, who preferred a less hostile method of progressivism. These men both live incredibly different lives, but were connected by their beliefs in creating a better world for the black community, through political, social, and economic change. Their work will never be forgotten and will be able to be seen well into the future as blacks are continuing to forge ahead, making the world a place that both T. Thomas Fortune and Booker T. Washington could be proud of. Works Cited Washington, Booker T. Up From Slavery. New York: W. W. Norton & Company Inc, 1996. Du Bois, W. E. B. The Souls of Black Folk. New York: Bedford/St. Martins, 1997. Fortune, Thomas T. Black and White: Land, Labor, and Politics in the South. New York: Arno Press, 1968. Thornbrough, Emma Lou. T. Thomas Fortune: Militant Journalist. New York: University of Chicago Press, 1972. Bracey, John H. , August Meier, and Elliot Rudwick. Black Nationalism in America. New York: The Bobbs-Merrill Company Inc, 1970 â€Å"Wikipedia. † 9 Nov. 2007

Investing in Low Income Housing Tax Credits Essay

Overview of the LIHTC The Low Income Housing Tax Credit (LIHTC) provides incentives for corporations and individuals to invest in the acquisition, development and rehabilitation of affordable housing. The program offers federal tax credits to private equity investors that work with profit or non-profit developers in constructing or renovating rental properties for low-income tenants, those who earn 60 percent or less of the median family income for their county. As of 2010, the program has sparked the construction of over 1.7 million housing units throughout the country. The IRS allocates federal tax credits to Housing Credit Agencies (HCAs) in each state based on its population. HCAs award credits to housing developers based on their Qualified Allocation Plan (QAP), a rigorous and competitive application used to determine which developers will receive the credits. Once credits are acquired, equity investors purchase an interest in the business entity generating the tax credits, namely a limited partnersh ip or limited liability company. The equity generated from the investor’s purchase is used to fund the property development. The tax credits are redeemed annually by investors over a ten-year period following the date that the property becomes operational, or â€Å"placed in service.† The number of tax credits, and subsequently the amount of equity raised, is calculated by computing the eligible basis, or the dollar amount of all depreciable costs of the project (which excludes the cost of land acquisition and operating reserves) minus ineligible sources of funding like grants or federal subsidies. The eligible basis is then multiplied by the percentage of eligible tax credit units in the project (at least 20 percent and up to 100 percent of all units in the building) to calculate the â€Å"qualified basis.† The investor may later claim either 9 percent or 4 percent of the qualified basis amount in tax credits per year, depending on whether the project is a new construction or rehabilitation of an existing structure.. As of March 2012, the average price for a credit is around $.94. Price fluctuates depending on the geography of the deal, the size of the project, the perceived risk of failure, and whether the project is a new construction or rehabilitation. In order to redeem the credits, the property must rent either 20 percent or more of the units to tenants whose incomes are at or below 50 percent or less of the area median gross income, or 40 percent or more of the units to tenants whose incomes are at or below 60 percent or less of the area median gross income. The property must fulfill these and other operational requirements for a 15-year compliance period. Failure to meet these requirements during the compliance period results in an IRS recapture of tax credits plus interest and penalties. Many states offer their own affordable housing tax credits to provide further incentives by increasing potential returns. Projects in certain areas (Difficult Development Areas) receive a 30 percent increase in qualified basis as well. Options for Investment in LIHTC LIHTC transactions are structured such that the developer manages the day-to-day operation of the property while the investor takes a passive role in management and collects virtually all the tax credits. The parties create a limited partnership or limited liability company where the investor is typically a 99.99% limited partner or non-managing member and the developer is a 0.01% general partner or managing member. This method shields investors from liability beyond their capital contributions and allows the developer to maintain control over management affairs. There are two methods of investing in LIHTCs. The first is a direct investment or private placement, where the investor purchases the rights to future tax credits from a single developer in return for an equity contribution. The developer and investor form a limited partnership where the investor retains a 99.99% ownership interest and claims use of 99.99% of the tax credits and other benefits. Large banks and blue-chip corporations are the typical direct investors, mainly because they possess vast amounts of financial and administrative resources. Private placements are adequate namely for single entities that manage their own investment affairs and desire complete transparency throughout the project. These investors generate more net equity since they save costs otherwise incurred by hiring syndicated funds to choose and underwrite the affordable housing development project. Another avenue through which to invest in tax credits is with a syndicator, a financial intermediary that raises funding from many investors, usually on an annual basis, and makes equity capital contributions to multiple affordable housing projects. Indirect Investment through syndicated funds provides a means by which individual investors, small community banks, and small corporations without the resources of large banks can invest in LIHTCs. A syndicator will attract investors and form a limited partnership agreement where the syndicator typically holds a .01% interest as general partner and various investors will comprise the other 99.99% ownership interest as limited partners. This limited partnership syndicate fund will then become the 99.99% limited partner in several LIHTC projects to allow tax credits to pass through to investors. The syndicator investigates the market for affordable housing development and chooses a number of projects in which to invest. The syndicator then directs private equity capital from the limited partners of the syndicate fund to multiple affordable housing developments and returns tax credits back to each investor in proportion to their capital contribution. A few syndicate funds have missions that are aligned with non-profit developers. A syndicator’s experience with affordable housing development is invaluable to investors as it minimizes risk and increases investor confidence. The syndicator does all due diligence and underwriting for the project, so investors can take a passive role. Syndicate funds are ideal for investors that cannot afford to hire relationship managers, compliance specialists, and underwriters to oversee development. A Worthwhile Investment Alternative A tax credit provides a dollar-for-dollar reduction in tax liability, unlike deductions that simply reduce the amount of taxable income for a particular taxable year. Even though investors contribute capital based on the amount paid per tax credit, other tax benefits are transferred to the investor in the form of passive losses and deductions available to any holder of rental real estate property. These include property depreciation deductions, interest expenses, business and maintenance costs, and others. Savings from tax-deductible expenses may not have the financial impact of a tax credit, but it provides a quantifiable saving to the investor that helps add measurable value to tax credits beyond the amount of proportional tax liability they reduce. A qualifying tax credit investment results in a decrease of tax liability. The economic return on the investment, therefore, is not subject to state or federal taxation, unlike dividends or interest income from stocks or bonds. A dollar amount of taxable income is thus inherently less valuable than an identical amount of tax credits. Certain passive loss restrictions and the Alternative Minimum Tax render tax credits less useful for the large majority of individual investors. Nonetheless, LIHTC projects were giving investors returns as high as 25%-30% during the early stages of the program. After growing competition increased pricing in the market for tax credits, yields have consistently shown 4%+ annual returns in recent years. LIHTC projects provide excellent returns for the risk involved, considering other investment alternatives available. While the stock market has historically given investors long-term returns of approximately 10% per year on average, there are sharp fluctuations from year to year. The stock market is also considered a more risky investment in comparison to U.S. treasury bonds or other corporate notes. The yields on these safer bonds are much less than that of the stock market. Investments in tax credits provide an interesting combination of risk mitigation potential and impressive earning yields. Unfortunately, the average investor has no control over the valuation of a certain corporate security, much less the performance of a mutual or index fund. However, private placement investors and syndicate fund managers can and do provide for stringent oversight requirements through contractual obligations imposed on the developer, which in turn helps mitigate risk of project failure. A rise in the valuation of a corporate security usually requires an indicator of increased earnings in the future, whether it is the introduction of a more efficient manufacturing technique, the release or upgrade of a new or existing product, or a similar corporate action. Any increase in the value of a security may be short-lived. An investor only realizes gain after a sale; that gain is taxed. LIHTC projects, on the other hand, do not require entire securities markets to move in order to obtain a profit. Aside from rigorous paperwork and professional fees, the tax credits will eventually fall in the hands of the investors so long as the developer does not fail to meet the various compliance requirements for the specified period. With continuous oversight, investors and fund managers can establish timelines for performance that may readily identify any setbacks or obstacles to completion. This may afford time to expedite construction or development and perhaps cure any potential defects in the plan. On the downside, securities markets provide instant liquidity; LIHTC projects require at least 11 years to harvest all profits. Timelines provide further protection when equity contributions are made in response to the developer meeting certain milestones that render project completion more likely. By disbursing equity in stages, investors exert more control over the project’s development and may elect to alter the course of the project. For instance, the investor may attempt to remove the developer if confidence is undermined. The 15-year compliance period provides an identifiable date of exit, after which all profits (in the form of tax credit use) have been harvested. If investors decide to exit the venture, a secondary market has emerged where an investor may be able to sell the credits to third parties. Legislation passed in 2008 allows limited partners to sell their ownership interests in affordable housing properties without facing recapture so long as the properties continue to operate as affordable housing. This allows a shortened holding period of up to 11 years as long as the property meets the 15-year compliance requirements. These advantages are largely unavailable to stock market investors and make tax credits a safe, viable and profitable investment alternative. These benefits apply uniformly to any tax credit investor. Large Banks, Larger Benefits Large banks and financial institutions are provided with a number of benefits that are generally inapplicable to individual and corporate investors, which in turn make credits more valuable and increases their market price. Banks subject to the Community Reinvestment Act (CRA) are required to engage in certain activities that improve community development. Direct investments and loans made to LIHTC projects, or syndicated funds that invest therein, are considered qualified activities under the CRA. Banks receive positive CRA consideration not only for these loans and investments to community projects, but also when equity is transferred to LIHTC projects that serve broader statewide or regional areas that include a particular bank’s assessment area. An unsatisfactory CRA rating can cause banks to be denied or delayed in undertaking certain business activities like mergers, acquisitions, or the expansion of services. Thus, banks have strong incentives to invest in affordable housing development. LIHTCs are often a top choice for banks, who are obliged to make community development contributions, because not all CRA qualified activities provide similar returns. Financial institutions also benefit from establishing banking relationships with real estate developers. This allows banks to expand their revenues by providing new services to the project like pre-development loans, construction loans, mortgage financing, and credit lines. Bridge loans are especially enticing, where banks loan large amounts of capital to syndicated funds or other Private Placement investors without the cash reserves to make the up-front equity contributions required by developers before any tax credits can be redeemed. Moreover, banks have the financial capacity to create long-lasting resources to assist in affordable housing investment. The underwriting and due diligence for a LIHTC project requires a number of services and incurs various costs. While syndicated funds spread these costs over a number of investors, banks are in a position to pay for these costs themselves. By establishing separate departments to oversee tax credit financing, banks make a one-time investment in an oversight apparatus that will operate over an indefinite number of LIHTC projects. These in-house professionals will increase in value as their experience expands and efficiency improves. Any bank with the capacity to conduct private placement investing in LIHTCs probably does so. Syndicated Funds: Investment Mechanisms for the Unsophisticated Tax Credit Investor A multi-investor syndicated fund provides a number of additional benefits to potential tax credit investors. It is helpful to analogize syndicated funds to mutual funds for the purpose of identifying their advantages. Just like mutual funds, where fund managers collect funding from many investors and create a diversified portfolio that is professionally managed, syndicated funds act in a similar fashion. Syndicated funds invest in multiple affordable housing developments, often in various geographic regions and with different housing developers. This allows investors to spread risk amongst different LIHTC projects so that if one project fails, their entire equity commitment is not lost. Investing with multiple investors allocates risk of loss more evenly and makes LIHTC investments a safe investment alternative. Furthermore, reputable syndicated funds are professionally managed by experienced, sophisticated tax credit professionals that probably have more knowledge about tax credit investing than any prospective investor. Few institutions and entities have enough capital reserves to fund an entire project single-handedly; syndicated funds combine investor contributions, allowing small entities like community banks and mid-size companies to have the flexibility of choosing how much capital to contribute to tax credit investment. The end result is an excellent mechanism through which unconventional tax credit investors can participate in the competitive market for tax credits. Even though funds collect a percentage fee, diversified portfolios will likely contain projects in DDAs to provide marginal increases in tax benefits. Corporations and Tax Credits: A Good[will] Investment. LIHTC are beneficial to corporations because annual tax credits have a positive impact on earnings per share, since credits reduce tax liability without diluting earnings. Tax credits are usually a profitable investment because most companies sustain consistent tax liability for years on end. Tax credit investment declined during the 2008 market downturn, but has steadily increased with general economic improvement. Companies like Google, Verizon, Liberty Mutual, and others have invested in affordable housing developments across the country. An additional and measurable economic benefit to corporations is the increased value of a trademark or goodwill associated with a company that invests in community development. This type of investment may also attract positive publicity and media coverage, which in turn may increase corporate securities valuation. Large corporations are also in a coveted position to undertake direct investment and avoid paying fees to syndicated funds. Safe, but Not That Safe. While LIHTC investments may be safer than comparable investment with similar yields, the risks must be identified for informed decision-making. Potential tax credit recapture and loss is the greatest risk—the project must maintain specific requirements over a period of 15 years and strict deadlines must be met. The investor must assume the risk of any impediment to completion of construction, no matter how farfetched, and recapture liability remains with the initial investor even if the credits are sold on the secondary market. Risk of failure extends for a prolonged period of 15 years where strict operational requirements must be met. Due to the speculation involved in predicting construction costs, securing subsequent financing, and meeting compliance deadlines in light of potentially unforeseen adverse events, a project must be very precisely calculated to increase the chance of success. Entities and individuals that invest in syndicated funds are in a better position to identify risks due to stringent government-imposed requirements for prospectuses and offering memoranda to be distributed to all potential investors. Inexperienced syndicators might overlook a key responsibility that can cause the project to fail. Repurchase obligations arguably provide a false sense of security to investors because most developers have small balance sheets and cannot afford to match the investor’s contributions. The risks involved in LIHTC investment can be mitigated with proper planning, continuous oversight, and an experienced syndicator. Banks with in-house asset management units can oversee property maintenance. Although investors cede lien priority to the primary mortgage holder, foreclosure rates are relatively low and occupancy rates relatively high. Tax credit projects are viable investment alternatives. ——————————————– [ 1 ]. Catherine Such, Low Income Housing Tax Credits. Federal Reserve Bank of San Francisco Community Investments (Mar. 2002), http://www.frbsf.org/community/investments/lihtc.html. [ 2 ]. Michael J. Novogradac, Investing in Low-Income Housing Tax Credits, OCC Community Developments. (Mar. 2010), http://www.occ.gov/static/community-affairs/community-developments-investments/spring06/ investinginlowincome.htm. [ 3 ]. Id., See Understanding Low Income Housing Tax Credits: How to Secure Equity Investments and Evaluate Syndication Options. Corporation for Supportive Housing (Mar. 2006), http://documents.csh.org/documents/ ResourceCenter/DevOpsToolkit/UnderstandingLIHTCspdf.pdf. [ 4 ]. Sherrie L. Rhine, Low-Income Housing Tax Credits: Affordable Housing Investment Opportunities for Banks. Community Affairs Development (Feb. 2008), Found in Real Estate Law Clinic Course Reader, at p. 75. [ 5 ]. Lance Bocarsly, Real Estate Law Clinic Lecture. (Thursday September 6, 2012, 4:30pm.) [ 6 ]. Understanding Low Income Housing Tax Credits: How to Secure Equity Investments and Evaluate Syndication Options, supra, Corporation for Supportive Housing (Mar. 2006.) [ 7 ]. In actuality, the percentage of qualified basis that determines the amount of tax credits is not exactly 9 or 4 percent. The rate for the 4 percent credit floats in accordance with the Applicable Federal Rate and may fluctuate above or below 4 percent. The 9 percent credit will float beginning in 2013, although current legislation has been proposed to extend the 9 percent credit floor. House of Representatives Bill 3661 is making its way through Congress. See Mark Anderson, Tax Credit at Risk for Low Income Housing. Finance and Commerce (April 26, 2012, 4:35 pm). Available at http://finance-commerce.com/2012/04/tax-credit-at-risk-for-low-income-housing/. [ 8 ]. Low-Income Housing Tax Credit: Facts & Figures, Novogradac Affordable Housing Resource Center. http://www.novoco.com/low_income_housing/facts_figures/index.php. [ 9 ]. Tim Iglesias and Rochelle E. Lento, The Legal Guide to Affordable Housing Development. Found in Real Estate Law Clinic Course Reader, at p. 28. [ 10 ]. Rhine, supra, Low-Income Housing Tax Credits: Affordable Housing Investment Opportunities for Banks.† Found in Real Estate Law Clinic Course Reader, at p. 87. [ 11 ]. Understanding Low Income Housing Tax Credits: How to Secure Equity Investments and Evaluate Syndication Options, supra, at p. 4. [ 12 ]. Id. [ 13 ]. Id. [ 14 ]. Novogradac, supra, Investing in Low-Income Housing Tax Credits. [ 15 ]. James L. Logue III, How LIHTC Funds Can Help Banks Invest in Affordable Housing. OCC: Community Developments (Spring 2006). http://www.occ.gov/static/community-affairs/community-developments-investments/ spring06/howlihtcfunds.htm. [ 16 ]. Id.

Roosevelts Arsenal of Democracy Analysis - 1550 Words

Roosevelt’s Arsenal of Democracy Analysis Throughout American history we have seen many great presidents as well as many bad presidents ingress the White House. All of our great presidents have revealed good moral values as well as a respectable system of beliefs. President Franklin Delano Roosevelt established his American ethos heavily during his terms in office, particularly during World War II when he addressed the nation on the impending issue of national security in his speech entitled â€Å"The Great Arsenal of Democracy.† By weaving American ideals as well as the ideals put forth in the Declaration of Independence into his speech, Roosevelt establishes his credibility as a man of righteousness and honesty and emphasizes on his good†¦show more content†¦Ã¢â‚¬Å"We met the issue of 1933 with courage and realism. We face this new crisis, this new threat to the security of our nation, with the same courage and realism† (Roosevelt 434). The issue of 193 3 the president was referring to was the great depression, a period in America’s history of record economic recession. Only through the practice of realism, realizing what situation we were in and figuring out what was best for recovery, and courage, the will to work hard and fearlessly, did America pull out of the recession. The president is trying to draw a connection between the new threat to national security and a familiar situation to prove that underestimating Germany is a grave mistake and we can’t just turn our heads to imminent danger. â€Å"But we well know that we cannot escape danger, or the fear of danger, by crawling into bed and pulling the covers over our heads† (Roosevelt 435). Roosevelt strengthens his argument by inferring that hiding doesn’t fix the problem it only physically masks it and only by facing this situation head and realistically will we overcome it. Roosevelt’s credibility is enhanced by being a leader, stepping up, and realizing that we can’t just sit back and hope Germany is stopped. We must take matters into our own hands and help those on the offense trying to preserve democratic ideals. Ironically, Roosevelt makes a point that contradicts the whole motivation behind the Declaration of Independence, Great Britain being our strongest ally. TheShow MoreRelatedThe American Political Tradition and the Men Who Made It Essay7033 Words   |  29 Pagestwelve of the most influential men and the political traditions they created, including the Founding Fathers who started it all. Additionally, Hofstadter informs the reader of other significant government officials including Andrew Jackson and his democracy, the progressive, trustbuster Theodore Roosevelt, and ending with Franklin D. Roosevelt and his programs of the New Deal. Richard Hofstadters ideas are brilliantly elucidated with his stunning choice of words and information. He begins the backgroundRead MoreOne Significant Change That Ha s Occurred in the World Between 1900 and 2005. Explain the Impact This Change Has Made on Our Lives and Why It Is an Important Change.163893 Words   |  656 Pageslamentable. Taken together, the key themes and processes that have been selected as the focus for each of the eight essays provide a way to conceptualize the twentieth century as a coherent unit for teaching, as well as for written narrative and analysis. Though they do not exhaust the crucial strands of historical development that tie the century together—one could add, for example, nationalism and decolonization—they cover in depth the defining phenomena of that epoch, which, as the essays demonstrateRead MoreRastafarian79520 Words   |  319 PagesJamaicans regard as their cultural contribution to the world. Later I will return to these issues and will demonstrate how they contribute to the routinization of Rastafari in Jamaica. The nature of this book dictates a heavy reliance on documentary analysis. My focus is interpretation not ethnography. Therefore, I have not sought to generate primary data on the movement but to analyze and re-analyze the growing body of scholarly and popular literature on the movement, including sociological and anthropological