CDFI Fund releases two industry reports and a guide for Native entities.
Eighteen months ago, the CDFI Fund launched the NMTC Native Initiative with the goal to increase New Markets Tax Credit (NMTC) investments in NMTC Native Areas[i] . Since the NMTC Program’s inception, the CDFI Fund has recorded investments totaling over $1.8 billion[ii] in Indian Country.
As I shared in my July 2022 blog post, the NMTC Native Initiative aligns with the CDFI Fund’s Strategic Plan goals to (1) make our programs more accessible by creating on-ramps to this critically needed program and (2) to encourage increased investment into NMTC Native Areas, which would further the community economic development strategies of those communities.
Today, I’d like to share our progress on this important initiative.
As part of this initiative, we held technical workshops in September 2022 and February 2023. We also provided approximately 80 hours of direct technical assistance to several Native organizations interested in utilizing NMTCs.
In addition, today the CDFI Fund is releasing the following two reports, and a guide to assist Tribal entities that want to participate in the NMTC Program.
Community Economic Development in Indian Country – Market Research Report
The purpose of the Market Research Report is to identify and review existing research and data on the unique history, challenges, industries, actors, available funding, and capital sources that shape how tribes and Native actors successfully participate in community economic development. This report examined existing literature that summarized the history and current state of community economic development in Native lands in the United States. When considering community economic development in Indian Country, the report finds that opportunities exist for enhancement. The need for improved data underlies many of the existing limitations. In addition, the need to understand and respect cultural values was found to be essential moving forward.
Potential Audience: Congress; government agencies and others involved in community economic development promotion or regulation; Tribal and Native leaders; economic development entities operating within Native land; and those who wish to better understand community economic development in Indian Country will benefit from reading this report.
New Markets Tax Credit Investments in Native Areas: Selected Case Studies and Best Practices
This Case Study Report presents findings, best practices, and recommendations derived from an online survey and subsequent interviews with individuals who have participated in past NMTC investments in NMTC Native Areas. In examining selected case studies, the report identifies common challenges and opportunities for expanding NMTC investment in Native Areas. Participants identified best practices that were critical to the success of past NMTC investments. Participants also made recommendations that should help increase the volume of future NMTC investments in Native Areas.
Potential Audience: Congress; government agencies; Tribes and Native governing organizations; Native CDFIs, CDEs, and potential CDEs; Native-serving funders; Non-Native tax credit investors and lenders; Sponsors and owners of Native-serving projects or businesses will benefit from reading this report.
New Markets Tax Credit Program Self-Assessment Guide for Native Organizations
The purpose of this Self-Assessment Guide is to help Native entities determine how they can best take advantage of the NMTC Program. This Self-Assessment Guide was informed by the findings of the Community Economic Development in Indian Country: Market Research Report and the New Markets Tax Credit Investments in Native Areas: Selected Case Studies and Best Practices. The guide covers the various roles of participants in the NMTC Program and the corresponding responsibilities. The guide also covers staffing, financial commitments, and operational capacity, including experience and systems related to underwriting, compliance, asset management, and reporting, as applicable.
Potential Audience: Native CDFIs; Native CDEs; Native-owned businesses; other Native entities interested in utilizing NMTCs will benefit from reading this report.
In an effort to continue the collective discussion and spur additional community economic development in Indian Country through NMTC investments, the CDFI Fund and its research partners will present the findings and best practices identified in these reports and guide to various stakeholders over the coming months.
We remain committed to our mission to expand economic opportunity for underserved people and communities by supporting the growth and capacity of a national network of community development lenders, investors, and financial service providers. Furthermore, with the publication of these latest reports and guide, the CDFI Fund continues to build upon its history of serving Native Communities through the NMTC Native Initiative.
[i] Federal Indian Reservations, Off-Reservation Trust Lands, Hawaiian Home Lands, and Alaska Native Village Statistical Areas are collectively referred to as NMTC Native Areas.
[ii] Includes all NMTC investments made in NMTC Native Areas, Oklahoma Tribal Statistical Areas, State Designated Tribal Statistical Areas, and Tribal Designated Statistical Areas from Fiscal Year 2004 to 2020, adjusted to 2021 dollars.