Awards will Spur Economic and Community Development in Low-Income Urban and Rural Communities Nationwide
WASHINGTON – The U.S. Department of the Treasury’s Community Development Financial Institutions Fund (CDFI Fund) announced $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 102 Community Development Entities (CDEs) were awarded tax credit allocations, made through the calendar year (CY) 2022 round of the New Markets Tax Credit Program (NMTC Program).
“The New Markets Tax Credit plays a critical role in financing many vital businesses and community projects in our nation’s low-income communities,” said Assistant Secretary Graham Steele. “The investments that will result from today’s announcement will help preserve and create hundreds of thousands of jobs and spur economic growth in these urban, rural, and Tribal communities across our country. It is important that Congress sustains these investments by making the New Markets Tax Credit permanent.”
“For more than 20 years, the New Markets Tax Credit has catalyzed needed investment into the nation’s low-income rural and urban communities, which have a long history of disinvestment. It has created jobs, helped build businesses, and is a pivotal force in helping these communities not just recover but to grow stronger,” said CDFI Fund Acting Director Marcia Sigal.
The 102 CDEs receiving awards today were selected from a pool of 197 applicants that requested an aggregate total of $14.8 billion in tax credit allocation authority. The award recipients are headquartered in 36 different states and the District of Columbia. Over 20% of the investments will be made in rural communities. It is estimated that these award recipients will make nearly $1 billion in New Markets Tax Credit investments in non-metropolitan counties.
Today’s announcement brings the total amount awarded through the NMTC Program to more than $76 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 2022, NMTC Program award recipients deployed more than $62.9 billion in investments in low-income communities and businesses; with impacts such as the creation or retention of more than 857,000 jobs, and the construction or rehabilitation of nearly 239 million square feet of commercial real estate.
2022 NMTC Program Award Resources
- Award Book: The list of awards, along with other facts and statistics about these awards
- Review Process: Learn how the CDFI Fund evaluates Allocation Applications
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% 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. Since the inception of the NMTC Program, the CDFI Fund has completed 19 allocation rounds and has made 1,563 awards totaling $76 billion in tax allocation authority. This includes $3 billion in Recovery Act Awards and $1 billion of special allocation authority used for the recovery and redevelopment of the Gulf Opportunity Zone.
To learn more about the New Markets Tax Credit Program, please visit www.cdfifund.gov/nmtc.
About the CDFI Fund
Since its creation in 1994, the CDFI Fund has awarded more than $7.4 billion to CDFIs, community development organizations, and financial institutions through its funding programs, allocated more than $76 billion in tax credit allocation authority to Community Development Entities through the New Markets Tax Credit Program, and guaranteed bonds for more than $2.1 billion through the CDFI Bond Guarantee Program.
To learn more about the CDFI Fund and its programs, please visit the CDFI Fund’s website at www.cdfifund.gov.
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