Erie, PA - Today, the Director of the U.S. Department of the Treasury's Community Development Financial Institutions (CDFI) Fund Donna J. Gambrell was in Erie, Pennsylvania to participate with Congressman Phil English in a New Markets Tax Credit (NMTC) workshop. The workshop was held in the H.O. Hirt Auditorium at the Erie County Public Library.
"To see successful NMTC investments come to fruition requires strong collaboration, partnerships and leadership," said Director Gambrell. "I applaud Congressman English for his continued support of the NMTC Program and his efforts to bring NMTC investments to the rural communities here in Northwestern PA."
The workshop brought together federal, state, and local government officials, developers, lenders, investors, and representatives of Community Development Entities, to address the various issues needed to increase NMTC investments in Northwestern Pennsylvania.
"The new market tax credit has emerged as a powerful financing tool for economic development in communities fighting to attract and retain good paying jobs at a local level," said Congressman English, a senior member on the House Ways and Means Committee, which has jurisdiction over tax policy. "Continued use of this program will allow us to increase access to capital for communities, just like Erie, and bolster our region's economic growth and stimulate job creation."
About the NMTC Program
The NMTC Program, established by Congress in December of 2000, permits individual and corporate taxpayers to receive a credit against federal income taxes for making qualified equity investments in investment vehicles known as Community Development Entities (CDEs). The credit provided to the investor totals 39 percent of the cost of the investment and is claimed over a seven-year period. Substantially all of the taxpayer's investment must in turn be used by the CDE to make qualified investments in low-income communities. Successful applicants are selected only after a competitive application and rigorous review process that is administered by the CDFI Fund.
Through the first five rounds of the NMTC Program, the CDFI Fund made 294 awards totaling $16 billion in tax credit allocation authority. The CDFI Fund anticipates awarding another $3.5 billion of allocation authority to CDEs in the fall of 2008. The NMTC Program is currently set to expire in 2008, but President Bush has asked Congress to extend the Program with a $3.5 billion authorization for 2009.
About the CDFI Fund
The CDFI Fund was created for the purpose of promoting economic and community development through investment in and assistance to community development financial institutions (CDFIs). The CDFI Fund's role in promoting community and economic development was expanded in FY 2001 when the Secretary of the Treasury delegated to the CDFI Fund the responsibility of administering the New Markets Tax Credit (NMTC) Program.
Since its creation in 1994, the CDFI Fund has awarded $864 million to CDFIs, community development organizations and financial institutions through CDFI Program, the Bank Enterprise Award (BEA) Program, and the Native Initiatives. In addition, the CDFI Fund has allocated $16 billion in tax credit authority to community development entities (CDEs) through the NMTC Program.
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