Jobs and Economic Development --- Massachusetts Business Exchange (MBE)

 

                                              

 

Jobs and Economic Development

 

 

The second key element of the program is investment of $8 billion by the banks in The Massachusetts Business Exchange (MBE) fund that

will be used to provide investment in new and existing business with the goal of preserving and creating jobs.

This fund will make investments and generate returns for its investors.

 

The Massachusetts Business Exchange (MBE)

The purpose of the MBE will be to provide new business/job growth throughout Massachusetts.  The exchange will be established on a

regional basis to coincide with the CHPF and also having its own regional board of directors.

 

Projected Private Sector Jobs Created               Massachusetts          160,000 Jobs

                                                                                    Nationwide              8,000,000 Jobs

Projected Return on Investment Per Year

 

ROI                                   Total Investment                         Yearly ROI

6%        x                        $8 Billion Dollars          =           $480 Million Dollars

 

Division of Profits

Participating Banks/Lenders                 50%       or           $240 Million

Home Mortgage Resolution Trust        50%       or           $240 Million

 

The Homeowners Mortgage Resolution Trust (HMRT) – to be established at the State level:

The HMRT will advance the funds to said participating banks/lenders who in turn will issue a new/reset first mortgage regarding said troubled

mortgages.  The HMRT, in conjunction with the rest of the first mortgage, will issue a fifteen year shared appreciation second mortgage.

 

This second mortgage will share in the appreciation with the homeowner over a ten year period as outlined within Schedule A.

                

 

Assumptions:

 

Repayment of said second mortgage shall be triggered by the sale of the home or a refinance of the home by the homeowner.  Upon sale, the seller

will pay his or her share of the appreciation owed to the HMRT.  The buyer will assume the 2nd mortgage and said obligations of the 2nd mortgage.

 

Assumptions for Schedule A:

 

Original Mortgage on property             $300,000

 

Buy-down of first mortgage                   $  75,000

 

Mortgage reset amount                          $225,000

 

Projected yearly appreciation rate                  3%.

 

 

Funding of the Massachusetts Business Exchange (MBE) and the Community Housing Partnership Fund (CHPF) will be provided by:

  • Employer/employee contributions through an employee benefit plan
  • Banks and insurance companies under the provisions of the Community Reinvestment Act.
  • Venture capital funds

 

The Massachusetts Business Exchange (MBE):

The purpose of the MBE will be to provide new business/job growth throughout Massachusetts.  The exchange will be established on a

regional basis to coincide with the CHPF and also having its own regional board of directors.

 

Massachusetts Business Exchange Fund Potential

 

 

Total                       % of                                               Monthly          Monthly                  Yearly

Workers             Workforce         Membership      Investment             Total                    Total          

 

3,000,000   X         10%                  300,000         $       30.00        $   9,000,000     $    108,000,000

                                 20%                  600,000        $       30.00        $ 18,000,000     $    216,000,000      

                                 40%              1,200,000         $       30.00        $ 36,000,000     $    432,000,000

                                 60%              1,800,000         $       30.00        $ 54,000,000     $    648,000,000

                                 80%              2,400,000         $       30.00        $ 72,000,000     $    864,000,000

                               100%              3,000,000         $       30.00        $ 90,000,000     $ 1,000,000,000

 

Note: For each $1 billion dollars invested, an estimated 20,000 jobs are created.  The goal of the CD-MAC is to obtain a 60% membership

participation within Massachusetts thus creating the potential for 15,000 new jobs yearly throughout Massachusetts.

On a national level, with 60% participation of America’s workforce, an estimated 450,000 new jobs per year would be created.

 

  • Monthly investment of $30.00 will be shared between the Employer and employee evenly.

 

Proposed Investment Strategies:

New Business Starts:  Fund may be used to invest into new business starts by maintaining a negotiated percentage of partial

ownership in said business.

  • Typically, a bank would be looking for start-up funding 30-40% from the individual who is starting the new business.  This funding will assist in

reaching that goal.

 

Existing Participating Businesses: Fund may be used for short-term working capital and business expansion.  Repayment terms as

well as interest rates will be determined on a case by case basis.  

 

                              

 

   

    

 

 

 

CDMAC is a US 501-C3   Non – Profit Corporation     Robert E. Minichielli Director   781-831-5764

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