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Awards will Spur Economic and Community Development Nationwide
May 23, 2019
Washington, DC – The U.S. Department of the Treasury’s Community Development Financial Institutions Fund (CDFI Fund) announced $3.5 billion in New Markets Tax Credits today that will spur investment and economic growth in low-income urban and rural communities nationwide. A total of 73 Community Development Entities (CDEs) were awarded tax credit allocations, made through the calendar year (CY) 2018 round of the New Markets Tax Credit Program (NMTC Program).
”The New Markets Tax Credit is a powerful economic development tool that attracts private capital into hard-to-finance businesses in distressed communities nationwide,” said CDFI Fund Director Jodie Harris. “Today’s awards will finance projects ranging from large manufacturing plants to grocery and retail stores that will create jobs and provide critically needed goods and services to residents of Low-Income Communities. One-fifth (20 percent) of the investments resulting from today’s awards will be made in rural communities.”
The 73 CDEs receiving awards today were selected from a pool of 214 applicants that requested an aggregate total of $14.8 billion in tax credit allocation authority. The award recipients are headquartered in 35 different states, Puerto Rico, and the District of Columbia. It is estimated that these award recipients will make more than $682 million in New Markets Tax Credit investments in non-metropolitan counties.
Today’s announcement brings the total amount awarded through the NMTC Program to $57.5 billion. Historically, NMTC Program awards have generated $8 of private investment for every $1 invested by the federal government. Through the end of fiscal year 2017, the most recent data available, NMTC Program award recipients deployed more than $48.6 billion in investments in low-income communities and businesses; with impacts such as the creation or retention of more than 800,000 jobs, and the construction or rehabilitation of more than 205 million square feet of commercial real estate.
Related Materials:
 About the New Markets Tax Credit Program
The New Markets Tax Credit Program, established by Congress in December 2000, permits individual and corporate taxpayers to receive a non-refundable tax credit against federal income taxes for making equity investments in financial intermediaries known as Community Development Entities (CDEs). CDEs that receive the tax credit allocation authority under the program are domestic corporations or partnerships that provide loans, investments, or financial counseling in low-income urban and rural communities. The tax credit provided to the investor totals 39 percent of the cost of the investment and is claimed over a seven-year period. The CDEs in turn use the capital raised to make investments in low-income communities. CDEs must apply annually to the CDFI Fund to compete for New Markets Tax Credit Program allocation authority.
To learn more about the New Markets Tax Credit Program, please view the program Fact Sheet or visit www.cdfifund.gov/nmtc.
About the CDFI Fund
Since its creation in 1994, the CDFI Fund has awarded over $3.3 billion to CDFIs, community development organizations, and financial institutions through: the Bank Enterprise Award Program; the Capital Magnet Fund; the Community Development Financial Institutions Program, including the Healthy Food Financing Initiative; the Financial Education and Counseling Pilot Program; and the Native American CDFI Assistance Program. In addition, the CDFI Fund has allocated $57.5 billion in tax credit allocation authority to Community Development Entities through the New Markets Tax Credit Program, and guaranteed bonds in the amount of $1.51 billion through the CDFI Bond Guarantee Program.
To learn more about the CDFI Fund and its programs, please view the Fact Sheet or visit the CDFI Fund’s website at www.cdfifund.gov.
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