Multitude of Organizations Urge Congress to Save Soon-to-Expire NMTC

Nearly 1,000 businesses, investors and organizations call on Congress to expand and make the community and economic development tax credit permanent

WASHINGTON, November 20, 2019 – Today, the New Markets Tax Credit (NMTC) Coalition sent a letter addressed to Congressional leadership, the House Ways and Means Committee and its Chairman, Richard Neal (D-MA), as well as to the Senate Finance Committee and its Chairman, Chuck Grassley (R-IA). The letter urges the permanent extension and expansion of the New Markets Tax Credit (NMTC), along the lines of the bipartisan New Markets Tax Credit Extension Act (H.R. 1680 S. 750).

Nearly 1,000 signatures came from banks and credit unions; nonprofits such as Habitat for Humanity chapters, YMCAs, Boys & Girls Clubs,  food banks and heath care clinics; businesses, ranging from very large businesses to small, family-owned operations; city governments; state and local elected officials and agencies; and associations that represent thousands of members.

“As the New Markets Tax Credit nears its expiration at the end of 2019, we hope Members will take note of its broad support,” said Kermit Billups, President of the NMTC Coalition and EVP, Co-Founder at Greenline Ventures. “The letter was signed by nearly a thousand organizations, representing all 50 states, Washington, D.C. and Puerto Rico, and located in every type of community, from rural areas to urban neighborhoods, and everywhere in between. Why? Because they have seen firsthand the success of NMTC in revitalizing communities, creating jobs, increasing economic opportunity and improving lives.”

Established in 2000 in the Community Renewal Tax Relief Act (P.L.106-554), the New Markets Tax Credit is a bipartisan effort to stimulate investment and economic growth in low-income urban neighborhoods and rural communities. The NMTC was most recently provided a five-year authorization in The PATH Act. (P.L. 114-113) in December 2015. There is great bipartisan support for NMTC in Congress:  32 Senators signed on in support of S. 750, which was introduced by Senators Roy Blunt (R-MO) and Ben Cardin (D-MD); in the House, H.R. 1680 has 109 cosponsors, led by Reps. Terri Sewell (D-AL), Tom Reed (R-NY), and 24 members on the Ways and Means Committee.

The NMTC works by providing a shallow federal tax credit of 39 percent, taken over seven years, for investments made in census tracts where the individual poverty rate is at least 20 percent or where median family income does not exceed 80 percent of the area median. Last year, more than 80 percent of all NMTC investments were in communities exhibiting severe economic distress with extremely low-incomes, high unemployment, or high poverty. Over the past 15 years, communities have come to count on the NMTC as a source of low-cost capital for challenging projects that would not have been possible but-for the NMTC. Since 2003, the Credit has delivered well over $100 billion in flexible capital to farming towns and urban neighborhoods left outside the economic mainstream.

“Despite an exemplary track record in revitalizing some of the poorest communities in our country, financing over 6,000 businesses, hospitals, daycare facilities, and manufacturing expansions and creating some one million plus jobs, the future of the NMTC is in jeopardy ,”  said Bob Rapoza, spokesperson for the NMTC Coalition.  “Without an NMTC extension, many of America’s urban neighborhoods and rural communities, struggling with high rates of poverty and unemployment, will lose access to billions of dollars for high-impact, community revitalization projects. No other the federal tax incentive is generally available to economically distressed rural and urban communities to promote economic revitalization making a permanent extension and expansion of the New Markets Tax Credit vital.” 

For examples of how the NMTC is making an impact in each state, see the NMTC Coalition’s 2019 NMTC Progress Report, State Impact Map or check out its Project Database.

Contact: Ayrianne Parks
[email protected] 
(202) 393-5225

The Letter

November 20, 2019,

Speaker Pelosi, Leader McConnell, Leader McCarthy, Leader Schumer, Chairman Neal, Chairman Grassley, Ranking Member Brady, and Ranking Member Wyden:

The New Markets Tax Credit (NMTC) expires at the end of 2019. We write to urge you to provide a permanent extension and expansion of the NMTC along the lines of the bipartisan New Markets Tax Credit Extension Act (H.R. 1680 and S. 750).

The NMTC is an important source of financing for businesses and community facilities in America’s most economically distressed rural and urban communities. Over the past 15 years, communities have come to count on the NMTC as a source of low-cost capital for challenging projects that would not have been possible but-for the NMTC. Since 2003, the Credit has delivered well over $100 billion in flexible capital to farming towns and urban neighborhoods left outside the economic mainstream. Those investments have generated over one million jobs at a cost to the federal government of less than $20,000 per job.

Without an NMTC extension, many of America’s urban neighborhoods and rural communities, struggling with high rates of poverty and unemployment, will lose access to billions of dollars for high-impact, community revitalization projects. For these reasons, we urge Congress to provide a permanent extension and expansion of the New Markets Tax Credit.

Signed,

Testimonials about the NMTC from signatories

Kimberly Cutcher, Executive Director, LISC Toledo, Toledo, OH

The new market programs has helped to revitalize vacant structures and brownfields in our community and return

Mills Rooks, CEO, South Georgia Industrial Development Fund, LLC, Albany, GA

We are a CDE for NMTC purposes, though have not yet received an allocation. But, we are located in south Georgia in the center of several counties that are defined as “severe distressed/non-metropolitan”. We feel that we are in a unique environment to attract job creating industries to LICs with the help of NMTCs. The CDFIFund.gov should have the NMTC program extended, and the allocation amount increased (as it is typically oversubscribed in excess of 3:1).

Demond Wilkerson, Managing Member, Modern Commercial Capital Institute (Bronx), Bronx, NY

It’s a tremendous aid in providing access to affordable Capital in low-income communities and as a benefit for MWBE Development and businesses

Mark McDaniel, President and CEO, Cinnaire

Every person deserves access to education, childcare services and programs that allow people to improve their quality of life. The Marshfield Area YMCA is a great example of what can be accomplished by forming collaborative partnerships to create community facilities that provide essential services and support healthy lifestyles.

Karlene Lehman, Vice President, Princeton Enterprises, Bloomfield Hills, MI

Our management company serves tax credit communities in 15 states that benefit from the tax credit program. The vast majority are single mothers with children and the elderly. Visiting these communities and meeting many residents, I’ve witnessed first hand how vital this program is to their welfare. They deserve decent affordable housing. Thank you

Pamela Stevens, Staffing Coordinator, Full House Marketing, Detroit, MI

As a staffing company to the Residential Property Management industry, our clients rely on us to provide experienced, qualified temporary staff as well as direct hire placement candidates to their apartment communities. We see daily the impact NMTC has on communities within the Detroit area. Continuing NMTC will help existing low-income communities renovate aging buildings and thrive by giving residents clean, modern and healthy homes. Continuing NMTC will also offer a lower cost of financing new projects further serving and servicing needy families searching for affordable housing. This program has continued to do so much good. Letting it lapse now, with the cost of living rising and basic, good quality housing scarce, would be devastating to people in need. Renewing this program is the right thing to do.

Julia Nelmark, President, Midwest Minnesota Community Development Corporation, Detroit Lakes, MN

NMTC’s have been critical in helping many projects become feasible – in urban and rural areas. All kinds of projects have been possible because of NMTC, such as manufacturing, community facilities, schools, medical facilities, Native American projects. With our loan funds we have financed projects as small as $250,000 with similar benefit’s as our larger projects up to $20 million.

Michael Ross, Investment Director, The Business Valued Advisor Fund, Austin, TX

NMTCS provide opportunities to fund both small business transactions enabling direct debt support for companies with higher risk profiles that according the Federal Reserve’s 2018 Study do not attract or receive the credit required to grow, yet form the base for 2/3rds of the nation’s job growth and funding of larger leveraged transactions that support manufacturers, healthcare and education, all improving the access to necessities for our disadvantaged communities to form long-term platforms for sustainable growth. Without this flexible resource the capital needs required by these divergent yet necessary components of community stability and growth could not be efficiently and effectively served.

Connie Lindsey, Northern Trust’s Head of Corporate Social Responsibility and Global Diversity, Equity and Inclusion

“We are pleased to be part of this meaningful project. We are committed to bringing capital to under-invested communities, including support of quality education that will change lives.”

Audrey Roling, CFO, YMCA of Greater Louisville, Louisville, KY

The NMTC program has increased the impact that the YMCA is having on the west Louisville community, bringing health equity outcomes to citizens who need it most.

Jim McCormick, Executive Director, Great Falls Rescue Mission, Great Falls, MT

The NMTC mean the world to us as an organization as we couldn’t have built a new Family Center without NMTC funding.

Steve Saltzman, CEO, Charleston LDC, Charleston, SC

Strongest anti-displacement tool available, allowing people in neighborhoods suffering from disinvestment to acquire assets on their balance sheets and build infrastructure in their communities that would otherwise be impossible but for NMTC.

Ted Wysocki, CEO, Institute of Cultural Affairs, Chicago, IL

Our Chicago Land-marked building provides affordable space to 20+ non-profit tenants who serve over 1,000 low-income individuals weekly. NMTC will enable us to restore our vintage building and increase its energy efficiency for years to come in assuring our community’s diversity.

Judy Harden, Finance Controller, United Rehabilitation Services, Dayton, OH

The NMTC has allowed us to expand our facility and serve more children and adults with disabilities.

David Allen, The Tennessee Rural Development Fund, Cookeville, TN

It means opportunity to induce/entice investment into Rural Tennessee to improve the quality of life for our communities.

Cathy Phan, Business Development Coordinator, Asian American Health Coalition dba HOPE Clinic, Houston, TX

The NMTC gives us the opportunity and sustainable funding to truly make an impact in the most vulnerable communities. Without the support of NMTC, communities that need the most help may get left behind, or worse, pushed out without any real solution to improving the community.

Kyle Coolbroth, CEO, Fueled Collective, Minneapolis, MN

It provides small businesses the ability to have an impact in neighborhoods that otherwise might not justify the investments, and in return contributing to the hyper local community. This is a critical program.

Kevin Smith, CEO, Habitat for Humanity of New Castle County, Wilmington, DE

The NMTC leverages resources to produce more affordable housing and change for low-income communities

Trish Miller, CEO, The William Pleshette Company, Atlanta, GA

As a Black female business owner, the NMTC has been instrumental in us being able to move forward with our product research and development. It is with this support that we have gotten even closer to a prototype that is ready for production. We are so grateful.

Louise Cohen, Chief Executive Officer, Primary Care Development Corporation, New York, NY

The NMTC program has enabled PCDC to finance 177 projects for its community health center clients throughout the U.S. $248 million in awards to PCDC have supported over $1.1 billion in projects that have created or retained 5,800 permanent and 5,000 construction jobs in urban and rural under-served communities and enabled safety net community based providers to serve more than 1 million patients annually nationwide with high-quality health care and integrated services, including mental health and substance use treatment.
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