The CDFI Fund* recently announced the release of an independent report on the federal New Markets Tax Credit (NMTC) Program. The report, compiled by Summit Consulting LLC, was released on August 1, 2017, and confirms that NMTC is meeting or exceeding the requirements and expectations of the Program. Key findings of the report include:
- 100 percent of projects examined were in full compliance and most projects far exceeded both the statutory requirements for economic distress and the compliance mandates of the CDFI Fund;
- CDEs are supporting businesses beyond the seven-year NMTC compliance period by leaving a significant portion of residual capital with businesses;
- NMTC projects significantly lower the cost of capital for businesses in distressed communities; and
- CDEs evaluated “appear to make NMTC investments in highly distressed census tracts surrounded by other distressed areas.”
The purpose of the NMTC Program is to provide an incentive for private sector investment in economically distressed rural and urban communities. Since its creation in 2000, the NMTC Program nationally has provided:
- $80+ Billion in total project financing, to
- 5,548 businesses, healthcare facilities, schools, and other revitalization projects prioritized by communities, into
- 179 Million square feet of real estate constructed or renovated, generating
- 750,000+ full time and construction jobs at businesses in America’s most distressed small towns and urban areas
Florida Community Loan Fund, FCLF, has been an active participant in the NMTC Program since 2004. Through the competitive awards process, FCLF has received a total of $271 million in federal tax credit allocation authority. Impact created from FCLF’s NMTC Program through 6/30/2017:
- $491 million total project costs, into
- 20 projects including healthcare facilities, education & youth mentoring, homeless and domestic violence service centers, job training, high impact economic development or manufacturing, into
- 1.5 million square feet of facilities constructed or renovated, generating
- 4,593 full time and construction jobs at businesses across Florida in low-income communities
CDFI Fund Director Annie Donovan was quoted on the recently released report findings, saying: “The report released today demonstrates that New Markets Tax Credits are being used as Congress intended: to attract private investment into projects in economically distressed communities. It also documents the ways that Community Development Entities (CDEs) that utilize the program are meeting and generally exceeding NMTC Program requirements.”
For more information on the results of NMTC, visit the NMTC Coalition website here.
To learn more about FCLF's NMTC Program, read the program description here or download an information sheet pdf here.
To learn more about the Summit Consulting independent report, read the press release on the CDFI Fund website or download a pdf of the report.
* The U.S. Department of the Treasury’s Community Development Financial Institutions Fund, or CDFI Fund. Learn more at www.cdfifund.gov