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REGULATORY RELIEF COULD SPUR INNER-CITY INVESTMENT; SOCIAL RESPONSIBILITY SHOULD BE NEW ITEM ON CORPORATE BALANCE SHEET

 REGULATORY RELIEF COULD SPUR INNER-CITY INVESTMENT;


SOCIAL RESPONSIBILITY SHOULD BE NEW ITEM ON CORPORATE BALANCE SHEET
 LOS ANGELES, May 18 /PRNewswire/ -- Corporate America's efforts to rebuild inner cities damaged by recent rioting should be encouraged with tax and other regulatory incentives so the tide of goodwill doesn't recede, according to one financial expert.
 "The Securities and Exchange Commission, working with the accounting profession, could allow public companies that make investments in the inner cities to treat these costs as a long-term investment rather than an expense, so earnings would not be negatively impacted," said Stan Ross, managing partner of Kenneth Leventhal & Co. "Financial statements could reflect this commitment, allowing a line item called 'special investment in America's inner cities,'" he added.
 According to Ross, analysts could be asked to make note of these investments and, hopefully, the marketplace would acknowledge these socially responsible corporations.
 "Congress could help spur investment by allowing these costs to be tax deductible. Tax incentives for rebuilding cities and creating jobs would be more than offset by reductions in the costs of welfare and unemployment benefits," he suggested.
 Ross called on Washington to implement the proposed federal enterprise zones to encourage corporations to open new factories, research and development facilities, and create jobs in the inner city. "Congress could stimulate job formation even further by awarding additional tax credits for job training programs," he urged.
 "It will take enormous capital to rebuild these communities and create jobs. Federal banking regulators should consider easing some restrictions to encourage financing select inner-city commercial and residential real estate projects," Ross said. He proposed limited exemptions to bank capital requirements for inner-city real estate loans.
 Ross strongly supports the extension of tax credits, due to expire at the end of June, for low-income housing, and research and development. "Mortgage revenue bonds should also be extended beyond the June 30 expiration to fuel the building of affordable housing," he added.
 In addition, Ross feels the federal or state governments could set up a loan program -- similar to the Small Business Administration -- for privately held companies. Banks or insurance companies could be granted special borrowing capacity for making loans to inner-city businesses or otherwise investing in the area, he added.
 Kenneth Leventhal is the country's eighth-largest accounting firm known for its expertise in real estate and financial services. It has offices in 13 cities and is affiliated internationally with Clark Kenneth Leventhal.
 -0- 5/18/92
 /CONTACT: Francie Murphy of Casey & Sayre, 310-457-3676, for Kenneth Leventhal & Co./ CO: Kenneth Leventhal & Co. ST: California IN: FIN SU:


AL-JL -- LA014 -- 1252 05/18/92 11:00 EDT
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Publication:PR Newswire
Date:May 18, 1992
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