The Deadline is January 26, 2023
Today, the CDFI Fund opened the 2022 NMTC Application Round. The agency will award $5 billion in allocation some time next year.
The good news: unlike last year, this year’s application is due nearly a month after the holiday season (January 26, 2023).
- Application Webinar: December 1, 2022 at 3:00 p.m. Eastern Time. Note: the CDFI Fund is asking participants to submit questions by Tuesday, November 29, 2022 via a service request in AMIS.
- CDE Certification Application Submission Deadline: December 2, 2022
- NMTC Application Registration in AMIS: December 15, 2022
- Last Day the CDFI Fund will answer application questions: January 24, 2023
- NMTC Allocation Application Submission in AMIS: January 26, 2023
- QEI Issuance and QLICI Requirements: May 4, 2023
- The application includes several new FAQs as well as some minor changes to the QEI issuance/QLICI thresholds.
Notable FAQ Updates:
NMTC Applicants (or their affiliates) with a previous CDFI Fund award: The CDFI Fund will deduct (up to 5) points for an Applicant’s (or its Affiliate’s) failure to meet the reporting deadlines set forth in any assistance, award or Allocation Agreement(s) with the CDFI Fund during the period from January 14, 2022 to the Allocation Application deadline in the NOAA.
Guidance on Questions 14/15 (interest rate calculations for the A-B structure: Applicants should describe what circumstances would dictate the specific rates, terms or features (lower LTV, DSCR, etc.); and how often the best rates, terms and features would be offered. The CDFI Fund understands that there are a number of factors that may affect QLICI interest rates, terms and features offered, including but not limited to: sources of capital expected to finance the business; risk, such as business start-up versus existing business; etc. In the response to Q. 14(b), Applicants must discuss the factors that would affect the QLICI interest rates, terms and features offered.
What to include in Table A5, row a (Business Name and Description):
What is the meaning of “mixed-use real estate” in A5/row n: The FAQ notes that multi-service community organizations alone are not the equivalent of mixed-use real estate, and it gives some examples.
Additional information on the difference between Q. 18 and Q29(c) in terms of due diligence.
New List of Underserved States: Arizona, California, Colorado, Florida, Nevada, North Carolina, Tennessee, Texas, Virginia, and West Virginia. The list also includes the Virgin Islands, American Samoa, Guam, and the Northern Mariana Islands.
Does your track record of community outcomes need to match your projected outcomes? No. Applicants should note that the track record of community outcomes does not have to be of an equivalent quantity to the projected community outcomes in order to score well on Application Q. 26.
Examples of how projected community outcomes will clearly benefit LIPs and residents of LICs: Commercial Goods or Services: The QLICI will finance a new grocery store in a USDA-designated food desert that will provide X number of LIC residents with access to affordable healthy foods (fresh meat, vegetables, and fruits). Financing Minority or Native American Businesses: QLICIs will finance expansion of a minority-owned manufacturing plant, which will result in the hiring of X number of Low-Income Persons; A QLICI to a Native American-controlled non-profit organization will provide childcare and social services to Y Low-Income clients per year. Community Goods and Services: QLICI to a charter school located in a Low Income Community will serve 1200 students of which 90% of students are on free or reduced lunch. Housing Units: QLICI will finance construction of mixed-use development that will include 50 rental units, of which 25 will be affordable to Low-Income Persons; and renovate 2,000 sf of office space for non-profits serving 1200 LIC residents annually. Environmentally Sustainable Outcomes: QLICI will finance remediation of a brownfield site that will be repurposed for a distribution center, which will result in 100 employees who are LIC residents that will not be exposed to environmental hazards
Quantifying Environmentally Sustainable outcomes: Applicants are no longer required to provide a metric for this outcome in Q.26. However, Applicants are required to clearly describe how it quantified the Environmentally Sustainable outcomes, including the extent the quantification used third-party sources and/or standards. For example, the Applicant used a U.S. EPA study to quantify that the energy efficient equipment purchased for a manufacturing facility will result in X% energy reduction. Another example: the Applicant projects that the community facilities it plans to build using U.S. Green Building Council standards will reduce energy consumption by at least X% per year compared to non-LEED certified buildings. [Our note: We think this means you don’t need a metric, but you are required to describe your methods for projections].
NMTC Transaction Costs Defined: This FAQ defines the difference between operating costs and transaction costs.