A recent report finds the New Markets Tax Credit (NMTC) program meets and exceeds the program’s objectives of bringing private investment into economically distressed rural and urban communities.
The report was commissioned by the U.S. Department of the Treasury’s CDFI Fund; you can read the full report here. As an independent Community Development Entity (CDE) and with a seat on the board of directors of the New Markets Tax Credit Coalition, the positive news from this recent report has us proud to say the least.
The intent of the study was to evaluate the operation and outcomes of the NMTC program.
Here are key findings from the “Summit – Compliance Review of New Markets Tax Credit Program” report:
- 100 percent of projects examined were in full compliance and most invested in highly distressed areas, generally exceeding the minimum thresholds mandated by IRS statute;
- The CDE typically uses repaid NMTC loans to make similar flexible-term loans to other low-income community businesses, extending the benefit beyond the initial borrowers and the life of the allocation;
- CDEs provide flexible financing to Qualified Active Low-Income Community Businesses (QALICB) in a variety of ways, all of which reduce the cost of capital for these businesses;
- CDEs appear to make NMTC investments in highly distressed census tracts surrounded by other distressed areas.
Travois works with a vast network of leverage lenders and NMTC investors to serve a diverse, nationwide service area comprising the Native communities of the United States. This report will be a valuable tool we use to help tell Indian Country’s story and drive policy to further strengthen the NMTC program.
We will continue working and advocating for economic development in American Indian, Alaska Native and Native Hawaiian communities.
Want to help? Read more here to get involved.