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CDFI Fund Awards $3.5 Billion in NMTC Authority


Second Quarter 2015
 

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On June 15, 2015, the CDFI Fund announced the recipients of its 2014 New Markets Tax Credit (NMTC) awards.

The awards totaled $3.5 billion in tax credit authority. A total of 76 organizations (allocatees) will receive tax credit allocation authority under the calendar year 2014 round of the program. The 76 organizations were chosen from a pool of 263 applicants that requested over $19 billion in allocation authority. The award announcement reflected the highly competitive nature of the NMTC award application process, with only 29% of applying organizations receiving awards. Approximately 30% of the awardees are also certified Community Development Financial Institutions (CDFIs) or subsidiaries of certified CDFIs.

The allocatees intend to use their NMTC awards to invest in a mix of both urban and rural areas. Of the total $3.5 billion in NMTC authority made available, the organizations awarded initially estimate that approximately $1.905 billion will be invested in major urban areas, $813 million will be invested in minor urban areas and $721 million will be utilized in rural areas. Additionally, 67% of the awarded organizations have indicated that portions of their NMTC awards will be devoted to Healthy Food Financing activities.

The awardees will use their NMTC authority to invest in distressed communities across the nation. Nearly 49% of the awarded organizations have a national service area, while approximately 17% of the awardees will focus on local markets such as specific cities and counties. Since the NMTC Program’s inception in 2000, over $43 billion in tax credit authority has been awarded to Community Development Entities through the NMTC Program and nearly 600,000 jobs are estimated to have been created or retained.

The NMTC Program continues to demonstrate that it is a highly efficient tax credit program. It is estimated that for every $1 invested by the federal government, the NMTC Program generates over $8 in private investment.

Contact

To learn more about CohnReznick’s services on behalf of the NMTC Program, visit our NMTC Resource Center or contact Scott Szeliga, partner, at Scott.Szeliga@CohnReznick.com or Ira Weinstein, principal, at Ira.Weinstein@CohnReznick.com or 410-783-4900.


This has been prepared for information purposes and general guidance only and does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is made as to the accuracy or completeness of the information contained in this publication, and CohnReznick LLP, its members, employees and agents accept no liability, and disclaim all responsibility, for the consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it.
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