New Round Of Competition For NMTC Opens

by Mike Godfrey, Tax-News.com, Washington

20 December 2007

The US Department of the Treasury on Tuesday announced the opening of the sixth round of competition for tax credits on $3.5 billion of equity investments under the New Markets Tax Credit (NMTC) Program.

The NMTC Program seeks to attract private-sector capital investment into the nation's urban and rural low-income areas, in order to help finance community development projects, stimulate economic growth and create jobs.

"I am very impressed with how this program is making significant impact in low-income communities across the nation," observed CDFI Fund Director Donna Gambrell. She continued:

"Capital is being raised and invested into projects many thought of as just a dream – from critically needed community facilities and charter schools to grocery stores and other businesses."

To date, the organizations awarded tax credits on $12.1 billion in equity investments in the first four rounds have already raised $8.84 billion in equity from investors.

Through fiscal year 2006, these allocatees reported deploying a total of $5.45 billion in qualified loans and investments in low-income communities across the nation.

Since the program's inception, these allocatees have reported:

• Developing or rehabilitating over 46 million square feet of commercial real estate;
• Creating 146,000 full-time construction jobs;
• Creating or maintaining 20,000 full-time jobs through loans or investments supporting businesses operating in low-income communities; and
• Providing Financial Counseling and other related services to 1,200 businesses.

This year's NMTC allocation round will include an emphasis on placing investments in under-served rural communities. The allocation application deadline is March 5, 2008.

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