News Archive:
2004
December
WASHINGTON, D.C. – December 23, 2004 –
The Treasury Department today released final regulations for the new markets tax credits (NMTC) program under Internal Revenue Code (IRC) Section 45D.
WASHINGTON, D.C. - December 13, 2004 -
Federal agencies, including the Internal Revenue Service (IRS) and Treasury, today published semiannual regulatory agendas listing hundreds of regulations and other guidance projects that are planned or that will be developed in the coming year. Among the guidance planned are rules that address the new markets tax credit (NMTC), including how it should be allocated to the partners of a partnership under section 704(b) of the Internal Revenue Code and related partnership issues, as well as issues involving qualified low-income community investments under section 45D(d)(1).
WASHINGTON, D.C. — December 10, 2004 —
In order to be eligible for an allocation, applicants in the third round of new markets tax credits (NMTCs) that are prior allocatees are required to meet certain thresholds by January 21, 2005, for the issuance of qualified equity investments (QEI) related to their prior NMTC allocation awards. The Community Development Financial Institutions (CDFI) Fund notified previous allocatees that they may request an amendment to existing current allocation agreement(s) with the CDFI Fund in order to facilitate meeting this requirement, but such requests and related questions must be submitted by December 15, 2004. Please contact the CDFI Fund's Compliance Manager, Yoo Jin Na, at (202) 622-8275 or by e-mail at nay@cdfi.treas.gov, if you have any questions regarding this matter.
To learn more about NMTC application, allocation and compliance, join Novogradac & Company LLP in San Diego for the New Markets Tax Credit Conference January 26-28, 2005.
WASHINGTON, D.C. — December 7, 2004 —
The number of community development entities (CDEs) certified by the Community Development Financial Institutions (CDFI) Fund has risen to 1,734 up from 1,639 as of September 7.
November
WASHINGTON, D.C. - November 16, 2004 -
The Community Development Financial Institutions (CDFI) Fund announced yesterday that the Community Investment Impact System (CIIS) is now available for CDFIs and community development entities (CDEs) that are required to submit transaction level and institution level reports for fiscal year 2004. More information on reporting deadlines will be featured in the December 2004 NMTC Monthly Report.
WASHINGTON, D.C. - November 10, 2004 -
The Community Development Financial Institutions (CDFI) Fund today published a notice of funding availability (NOFA) for the Financial Assistance (FA) component of the CDFI Program for 2005. According to the notice in today's Federal Register , an FA component applicant, its subsidiaries or affiliates also may apply for and receive a tax credit allocation through the New Markets Tax Credit (NMTC) program, but only to the extent that the activities approved for FA component awards are different from those activities for which the applicant receives an NMTC allocation. The FA component provides FA awards and technical assistance (TA) grants to CDFIs that have comprehensive business plans for creating demonstrable community development impact through the deployment of capital within their respective target markets for community development purposes. Applications are due by 5 p.m. ET on February 24, 2005.
CHICAGO — November 4, 2004 —
Fannie Mae and the National Community Capital Association (NCCA) today announced a new agreement to benefit the efforts of community development financial institutions (CDFIs) to turn around distressed communities. Under the agreement, Fannie Mae will serve as a founding subscriber of NCCA's CDFI Assessment and Rating System (CARS) , a new rating system that provides impact performance and financial performance scores on CDFIs that investors, such as Fannie Mae, can use to guide investment decisions. In addition, Fannie Mae will utilize consulting services from NCCA, which will assist Fannie Mae in underwriting CDFI transactions, monitoring investments and servicing its CDFI assets.
October
WASHINGTON, D.C. - October 27, 2004 -
The Rural Housing Service (RHS) today announced the availability of $6 million of grant funds for the Rural Community Development Initiative (RCDI) program. Applicants must provide matching funds in an amount at least equal to the federal grant. These grants will be made to qualified intermediary organizations that will provide financial and technical assistance to recipients to develop their capacity and ability to undertake projects related to housing, community facilities or community and economic development. The deadline for receipt of an application is 4 p.m. Eastern Standard Time January 25, 2005.
JACKSON, Miss. - October 26, 2004 -
Bank of the Ozarks of Little Rock is among six lead investors that announced a $15 million initiative to improve the economy in economically distressed areas of the Midsouth. Bank of the Ozarks and the other companies - Entergy, AmSouth, BankPlus, Beau Rivage and Trustmark - have committed $5.5 million, the first stage of investments backed by the New Markets Tax Credits program, according to Arkansasbusiness.com. The investments will go to support the expansion of Enterprise Corporation of the Delta/Hope Community Credit Union (ECD/HOPE), a regional community development financial institution (CDFI). With the NMTC investments, ECD/HOPE told Arkansasbusiness.com it plans to make more than $60 million in small-business loans and more than 5,000 mortgages in low-income areas during the next five years.
WASHINGTON, D.C. — October 22, 2004 —
President George W. Bush today signed into law H.R. 4520, the "American Jobs Creation Act of 2004," which contains provisions to enhance community revitalization incentives in economically distressed regions by enhancing eligibility criteria for Renewal Communities and the New Markets Tax Credit (NMTC). The new law also repeals the extraterritorial income exclusion in current tax law; provides domestic manufacturing and other business tax relief, including energy-related tax credits; allows for itemized deduction of state and local sales taxes; provides for reform of tobacco subsidies; includes international tax reform and simplification provisions; and includes various revenue-raising provisions. Click here for a copy of H.R. 4520.
WASHINGTON, D.C. — October 20, 2004 —
At the Community Development Financial Institutions (CDFI) Fund's Advisory Board meeting yesterday the CDFI Fund reported that it received 208 applications requesting approximately $23 billion in new markets tax credit (NMTC) allocations in the third application round. There is $2 billion in NMTC allocation available in the current cycle. Demand in the third round is down compared to the last cycle, when 250 applicants requested approximately $30 billion in NMTCs and $3.5 billion was available. The CDFI Fund also reported that 25 of the 63 allocatees from the second round have signed allocation agreements. In addition, the CDFI Fund says 40 of the 66 first round allocatees have issued more than $669 million in qualified equity investments (QEIs) to date. This represents QEIs for more than 25 percent of $2.5 billion in NMTCs awarded in the first allocation round.
WASHINGTON, D.C. — October 12, 2004 —
The American Jobs Creation Act of 2004 (H.R. 4520), which includes provisions relating to the new markets tax credit (NMTC), has been approved by Congress and now awaits President George W. Bush's signature. The $137 billion corporate tax cut package authorizes the Treasury Secretary to designate "targeted populations" as low-income communities for purposes of the NMTC. A "targeted population" is defined as ".individuals, or an identified group of individuals, including an Indian tribe, who (A) are low-income persons; or (B) otherwise lack adequate access to loan or equity investments." H.R. 4520 also provides that a census tract with a population of less than 2,000 will be treated as a low-income community for purposes of the NMTC if the census tract is within an empowerment zone and is contiguous to one or more low-income communities. The measure also provides that if a census tract is located in a high migration rural county, low-income is defined by reference to 85 percent (rather than 80 percent) of the statewide median family income. H.R. 4520 defines a high migration rural county as any county that, during the last 20-year period ending with the year in which the last census was conducted, has a net out-migration of inhabitants from the county of at least 10 percent of the population of the county. Click here for a copy of H.R. 4520.
WASHINGTON, D.C. — October 11, 2004 —
In addition to submitting allocation applications by October 6, applicants for the third round of new markets tax credits (NMTCs) must meet additional remaining deadlines in order to be eligible for an allocation. The signature page and attachments for the electronic application must be must be mailed to the Bureau of Public Debt (not the CDFI Fund) and postmarked on or before October 12, 2004 and received by 5 p.m., Eastern Time, on October 19, 2004. In addition, previous allocatees must meet the necessary qualified equity investment (QEI) issuance thresholds by January 21, 2005.
September
WASHINGTON, D.C. - September 27, 2004 -
The Federal Historic Rehabilitation Tax Credit program has been and remains one of the most powerful and successful federal tools to preserve our nation's historic inner cities and town centers, the National Park Service (NPS) said last month. In a paper released in August, NPS proposed an initial work plan for improving the administration of the historic rehabilitation tax credit program in response to recommendations developed and submitted to NPS by the Historic Preservation Development Council (HPDC), the National Trust for Historic Preservation (NTHP) and the National Conference of State Historic Preservation Officers (NCSHPO).
To discuss the NPS report and other recent developments in the Historic Rehabilitation Tax Credit industry, join Novogradac & Company LLP in San Francisco for the Historic Tax Credit Conference October 27-29, 2004.
WASHINGTON, D.C. - September 24, 2004 -
The Community Development Financial Institutions (CDFI) Fund has updated its 2005 new markets tax credit allocation application Q&A document, adding five additional questions (Questions 39-43) and responses that may be of importance to those applying for NMTCs in the third round, For more information, click here.
WASHINGTON, D.C. — September 22, 2004 —
Eighteen states offer state tax credit programs for investment directly into businesses or seed capital funds, according to the results of a survey produced by the Community Development Venture Capital Alliance (CDVCA), which had the assistance of two students from Harvard University's Kennedy School of Government. CDVCA conducted the research with support from the Ewing Marion Kauffman Foundation. The survey also compares the terms and, to the extent information could be obtained, the results of these programs. Click here for a copy of the report.
WASHINGTON, D.C. — September 20, 2004 —
The Community Development Financial Institutions (CDFI) Fund today announced the next meeting of the Community Development Advisory Board, which provides advice to the CDFI Fund's director on the policies regarding the activities of the CDFI Fund, will be held on October 18-19, 2004. The meeting is open to the public but participation in the discussions will be limited to advisory board members, Department of the Treasury staff and certain invited guests. Anyone who would like to have the advisory board consider a written statement must submit it to the CDFI Fund by 5 p.m., Friday, October 1, 2004. On October 18, the meeting will include a report from the director on the activities of the CDFI Fund since the last advisory board meeting, as well as policy, programmatic, fiscal and legislative initiatives for the years 2005 and 2006. On October 19, the meeting will include a discussion of the CDFI Fund's policy and strategic directions for the future. Click here for more information.
WASHINGTON, D.C. — September 9, 2004 —
The number of community development entities (CDEs) certified by the Community Development Financial Institutions (CDFI) Fund has risen to 1,639 as of September 7, up from 1,408 as of April 9.
WASHINGTON, D.C. — September 2, 2004 —
The Community Development Financial Institutions (CDFI) Fund's electronic NMTC application is now available. For the instruction manual, which will provide direction on accessing the online application through myCDFIFund, click here.
August
WASHINGTON, D.C. - August 31, 2004 -
While the Community Development Financial Institutions (CDFI) Fund accepts applications for community development entity (CDE) certification on a rolling basis, an applicant must be certified as a community development entity (CDE) or have a CDE Certification Application pending in order to be eligible to apply for a new markets tax credit (NMTC) allocation. An organization that wishes to apply in the 2005 NMTC allocation round and has not been certified as a CDE must see that its CDE certification application is postmarked on or before Sept. 8, 2004 and is received by 5 p.m., ET, Sept. 15, 2004. CDFIs and SSBICs are required to register online as CDEs on or before the same date in order to be eligible to apply for an allocation of tax credits in the 2005 round. As of April 9, 2004, 1,409 CDEs had been certified by the CDFI Fund. For more information about CDE certification, click here.
WASHINGTON, D.C. - August 26, 2004 -
U.S. Department of Agriculture (USDA) Secretary Ann M. Veneman today announced the selection of 83 applicants in 45 states to receive approximately $11.3 million in grants for business development and job creation. Two types of business grants are being awarded through USDA Rural Development to finance or develop small and emerging businesses. They are: Rural Business Enterprise Grants (RBEG), which can be used for a variety of purposes, including technical assistance, machinery and equipment purchases, revolving loan fund creation and building construction, and Rural Business Opportunity Grants (RBOG), which by supporting their economic planning, technical assistance and business training costs help communities with exceptional needs sustain economic development. Funding of selected applicants will be contingent upon meeting the conditions of the grant agreement. Click here for a list of the individual awards.
MINNEAPOLIS, Minn. — August 10, 2004 —
The community development finance sector, which focuses on underserved communities and individuals, is "key to U.S. economic growth over the next 50 years," according to Mark Pinsky. Pinsky, National Community Capital Association president and CEO, delivered the keynote address at the New Markets Tax Credit Workshop sponsored by the Community Affairs Department of the Federal Reserve Bank of Minneapolis. Pinsky also is a presidential appointee to a Treasury Department advisory panel on CDFIs, and is vice-chair of the Federal Reserve's Consumer Advisory Council.
Upcoming workshops include the CDFI Fund's free interactive video teleconference on Tuesday, August 24, 2004 at 1:00 p.m. EDT; and Novogradac & Company LLP's application workshops August 27 in San Francisco and August 31 in Washington, D.C.
WASHINGTON, D.C. — August 5, 2004 —
The U.S. Department of the Treasury announced today the opening of the third round of competition for the allocation of as much as $2 billion in tax credits under the New Markets Tax Credit (NMTC) program. Through the first two program rounds, the Treasury Department's Community Development Financial Institutions (CDFI) Fund has made 129 NMTC awards, totaling $6 billion in tax credit allocation authority. Click here to download the notice of allocation availability, a copy of the application and guidance on the third NMTC allocation round. The application deadline is October 6, 2004.
The CDFI Fund is offering a free interactive video teleconference on Tuesday, August 24, 2004 at 1:00 p.m. EDT. Novogradac & Company LLP will present August 27 in San Francisco and August 31 in Washington, D.C.
WASHINGTON, D.C. — August 4, 2004 —
Arthur A. Garcia, director of the Community Development Financial Institutions (CDFI) Fund at the U.S. Department of the Treasury, announced the political appointment of Troy V. Stang as director of legislative and public affairs. Stang most recently served as vice president of staff and public relations for the Texas Credit Union League. Stang's principal responsibilities at the CDFI Fund will be to establish and maintain an effective legislative and public affairs program. To learn more, click here.
BALTIMORE — August 3, 2004 —
Columbia, Ohio-based ESIC Realty Partners Inc. and investment partner Fifth Third Bank of Ohio announced the closing of a $12 million loan to an urban redevelopment project in Columbus, Ohio. By partnering with ESIC on the deal, First Third Bank will receive nearly $4.7 million in federal new markets tax credits (NMTCs) over seven years. ESIC's investment closes the funding gap for the retail component of Columbus' South Campus Gateway, a mixed-used, urban redevelopment project. It is being built by Campus Partners for Community Urban Redevelopment, a not-for-profit development entity established by Ohio State University.
July
WASHINGTON, D.C. - July 23, 2004 -
President George Bush today announced a new initiative to expand business ownership and entrepreneurship among minorities by joining with the National Urban League (NUL) to create an entrepreneurship network. Supported by the Business Roundtable and the Ewing Marion Kauffman Foundation, the NUL network will include one-stop centers for business training, counseling, financing and contracting. NUL will utilize part of the $127.5 million New Markets Tax Credit (NMTC) it was awarded with Stonehenge Capital Corporation to provide financial counseling in underserved areas. Click here for more information.
WASHINGTON, D.C. - July 22, 2004 -
Democratic presidential candidate Sen. John Kerry (Mass.) and vice-presidential candidate Sen. John Edwards (N.C.) yesterday released an "Opportunity Agenda" outlining several points of their political platform that includes a proposal to revive the New Markets Venture Capital (NMVC) Initiative. Kerry authored the December 2000 law that established the NMVC program, but despite initial success Congress last year eliminated funding for the program's second round in the FY2003 Omnibus Appropriations Act.
MINNEAPOLIS, Minn. — July 19, 2004 —
Neighborhood Development Center (NDC), In the Heart of the Beast Puppet and Mask Theatre (HOBT), Latino Economic Development Center and Local Initiatives Support Corporation (LISC) announced last week that they would use new markets tax credits (NMTCs) to help rehabilitate the former Antiques Minnesota building on Bloomington and Lake Streets. The three-story, 43,000-square foot commercial building has been vacant since 1998. The extensive renovation will combine retail, office and not-for-profit arts space. LISC says this is the first project in Minnesota to leverage NMTCs and the Historic Rehabilitation Tax Credit (HTC). The total cost of the project is $4.26 million. Project partners include Wells Fargo Bank and Wells Fargo Community Development Corporation (CDC), the City of Minneapolis and Minneapolis Empowerment Zone, the Metropolitan Council, Pohlad Foundation, Northwest Area Foundation, Partners for the Common Good and a variety of other lenders. Click here for more information.
LOUISVILLE, Ky. — July 14, 2004 —
An audience of about 100 attended a meeting this week to review the application process for the New Markets Tax Credits (NMTCs) awarded to the team of Louisville Development Bancorp, in partnership with Frost Brown Todd LLC, in May. The Courier-Journal reports that the Muhammad Ali Center, the Frazier Historical Arms Museum and two downtown hotels were among the projects to express interest when Louisville's $62.5 million share of the credits was announced. The Louisville Community Development Bank will accept proposed project summaries through 5 p.m. on Aug. 30.
WASHINGTON, D.C. — July 13, 2004 —
The first online edition of the Office of the Comptroller of the Currency's Community Developments newsletter focuses on how investments in new markets tax credits (NMTCs) can help fill gaps in financing for projects located in economically distressed communities. The print edition of Community Developments is published semi-annually on topics relating to community development lending and retail financial services in underserved markets. The Summer 2004 issue, "New Markets Tax Credits - Bridging Finance Gaps," describes national bank strategies for using NMTCs to reach projects located in markets that might otherwise lack financing or only find financing at too high of a cost. The newsletter also highlights community development investment opportunities across the nation identified by OCC's District Community Affairs Officers. Click here to read more.
WASHINGTON, D.C. — July 12, 2004 —
Novogradac & Company LLP and Nixon Peabody LLP recently sent a joint letter to the Internal Revenue Service (IRS) requesting guidance on the extent to which cash distributions can be made from a community development entity (CDE) to its equity members without such distributions being treated as a redemption for the new markets tax credit (NMTC) under Section 45D of the Internal Revenue Code (IRC). "Because this matter is very important to transactions involving the new markets tax credit under Section 45D, we urge all industry participants to express their support for guidance and to offer their suggestions on how the IRS might best handle the issue," says Michael J. Novogradac, managing partner in the firm's San Francisco office. Click here for a copy of the letter.
WASHINGTON, D.C. — July 9, 2004 —
The U.S. Department of Housing and Urban Development (HUD) last week proposed a rule to revise the Community Development Block Grant (CDBG) program regulations to clarify the eligibility of brownfields-related activities. Among other things, the proposed rule would expand the "slums or blight" national objective criteria to include known and suspected environmental contamination, as well as economic disinvestments, as blighting influences. Click here for a copy of the proposed rule.
WASHINGTON, D.C. — July 1, 2004 —
The Community Development Financial Institutions (CDFI) Fund today announced the successful launch of the Community Investment Impact System (CIIS). The CDFI Fund says it expects CIIS to be "the country's most complete repository of data on the community development finance industry." The system will track detailed, standardized information on CDFIs and community development entities (CDEs). The CDFI Fund says more than 300 CDFIs and CDEs were required to submit institution level reports through CIIS by the end of June 2004. However, only six institutions were required to submit a transaction level report by this date. These six are New Markets Tax Credit (NMTC) Program allocatees that issued a qualified low-income community investment (QLICI) loan or equity investment by December 31, 2003. Click here for more information.
June
WASHINGTON, D.C. - June 28, 2004 -
The Treasury Department today published its semi-annual regulatory agenda, which summarizes the tax regulations and other administrative guidance the Internal Revenue Service (IRS) and Treasury intend to publish during the next six months. The agenda includes several items regarding the New Markets Tax Credit (NMTC) program: regulations to address how the NMTC should be allocated to the partners of a partnership under Section 704(b) of the Internal Revenue Code and related partnership issues; the NMTC regulations under Section 45D; and amendments to address certain issues involving qualified low-income community investments under Section 45D(d)(1).
WASHINGTON, D.C. - June 25, 2004 -
The Community Development Financial Institutions (CDFI) Fund has posted a draft allocation agreement for allocatees in the 2003-2004 allocation round of the New Markets Tax Credit (NMTC) Program. This draft includes several changes from the allocation agreement used in the first NMTC allocation round. The draft allocation agreement provides boilerplate provisions of the terms and conditions that may be entered into between the CDFI Fund and an allocatee; the exact terms and conditions of each specific NMTC allocation will be set forth in the allocation agreement that is executed by the CDFI Fund and each allocatee. The CDFI Fund says it expects to send out organization-specific allocation agreements to the 2003-2004 allocatees in July. Click here for a copy of the draft allocation agreement.
LOUISVILLE, Ky. — June 23, 2004 —
Two public meetings have been scheduled to discuss the $62.5 million allocation of new markets tax credits (NMTCs) awarded to Louisville Development Bancorp (LDB). LDB's application was prepared by the Louisville Community Development Bank and Frost Brown Todd. The first meeting, to explain how the NMTC program works, will be at 6 p.m. on Monday June 28 at Metro Hall, 527 W. Jefferson St. The second meeting, intended for people with projects in mind, will be at 2 p.m. July 13, also at Metro Hall.
BOSTON — June 16, 2004 —
"The New Markets Tax Credit Program: How This Incentive Can Strengthen America's Cities," a report written by Jim Miara and published by CEOs for Cities, describes the New Markets Tax Credit (NMTC) program objectives and how it compares with other subsidies. The report also details how the program is administered, qualifying investments and how NMTCs are allocated. The report also describes the financial structure of two closed deals and analyzes currently pending deals that could use the help of NMTCs.
WASHINGTON, D.C. — June 15, 2004 —
The Internal Revenue Service (IRS) is soliciting comments concerning Form 3800, General Business Credit. Form 3800 is used to figure the correct credit allowed under Internal Revenue Code section 38, which permits taxpayers to reduce their income tax liability by the amount of their general business credit. The general business tax credit is an aggregation of a taxpayer's investment credit, work opportunity credit, welfare-to-work credit, alcohol fuel credit, research credit, low-income housing credit, disabled access credit, enhanced oil recovery credit, etc. A new line has been added to Form 3800 for the new markets tax credit. Written comments should be received on or before August 16, 2004. Click here for more information.
May
WASHINGTON, D.C. - May 28, 2004 -
Community development financial institutions (CDFIs) are growing rapidly and are having enormous impacts on low-income communities in the form of new high-quality jobs, affordable housing units, community facilities and financial services to low-income people according to a new report released by the CDFI Data Project (CDP). The 442 CDFIs in CPD's study held $10.2 billion in assets in fiscal year 2002 and provided $2.6 billion in financing and assistance to 7,800 businesses that created or maintained more than 34,000 jobs, and facilitated the construction or renovation of more than 34,000 units of affordable housing.
WASHINGTON, D.C. - May 27, 2004 -
The Internal Revenue Service (IRS) will hold a public hearing on the proposed revisions to the new markets tax credit (NMTC) regulations at 10 a.m. on June 2 in the IRS Auditorium, Internal Revenue Building, 1111 Constitution Avenue, NW., Washington, D.C. Novogradac & Company LLP submitted written comments on the proposed revisions, as did the NMTC Coalition. The comments address numerous issues including the treatment of taxable income, the recapture rules and 'right to cure' period, the substantially all test and profit motive. Click here to access copies of these comment letters.
WASHINGTON, D.C. — May 20, 2004 —
The House this week passed H.R. 4193 to expand eligibility for the new markets tax credit (NMTC) by treating certain census tracts with low populations as low-income communities. The bill, introduced by Rep. Istook, also would provide for expansion of areas designated as renewal communities based on 2000 census data. The bill will now go to the Senate for consideration.
WASHINGTON, D.C. — May 19, 2004 —
The Community Development Financial Institutions (CDFI) Fund has announced that it will launch the Community Investment Impact System (CIIS) on June 1. CIIS is a new web-based data collection system that CDFIs and community development entities (CDEs) will use to submit institution-level and transaction-level reports regarding their activities under the New Markets Tax Credit (NMTC) program and other programs administered by the CDFI Fund. CDFIs and CDEs will be able to access CIIS through the MyCDFIFund section of the CDFI Fund's web site beginning June 1. All of the available CIIS documents are currently accessible (for informational purposes only) at www.cdfifund.gov/ciis/. To discuss NMTC monitoring and reporting, join us in Washington D.C. June 9-11 for the New Markets Tax Credit Conference.
WASHINGTON, D.C. — May 18, 2004 —
In the highly-oversubscribed second round of New Markets Tax Credit (NMTC) allocation approximately 250 certified community development entities (CDEs) requested $30 billion in tax credit authority. Recently released analysis from the NMTC Coalition details some of the patterns and trends in the 62 successful CDEs that received allocations totaling $3.5 billion that will be invested in 40 states and the District of Columbia.
The Coalition reports that allocations to "mission-driven" CDEs such as CDFIs, CDCs and related organizations ($1.7 billion) were roughly equal to allocations to CDEs affiliated with public bodies and other CDEs affiliated with for-profit entities ($1.8 billion). The analysis also reveals that in Round Two, real estate investing was the clear favorite among financing activities. The Coalition reports that a total of 35 CDEs, with allocations totaling $2.3 billion, identified real estate as their predominant financing activity. The second largest group of successful applicants was comprised of 23 CDEs - with a combined allocation of $900 million - that identified business development as their main focus. In general, the Coalition found that Round Two allocations are larger than those from the first NMTC round. With a billion dollars more in available credits, the average allocation increased from $37.8 million to $56.45 million and the median jumped from $21 million to $50 million.
WASHINGTON, D.C. — May 17, 2004 —
Legislation crafted to codify the economic substance doctrine and curtail transactions that are simply motivated by tax incentives would not apply to or have a negative effect on the new markets tax credit (NMTC). That was the conclusion of Sen. Max Baucus, D-Mont. who responded in a Senate Floor colloquy that addressed Sen. John Rockefeller's D-W. Va. concern that investors and potential investors feared that such codification would have a negative impact on the NMTC. It should be noted that a colloquy has no precedential value unless it is part of the legislative history of a bill that passes both houses and is signed into law by the President.
WASHINGTON, D.C. — May 14, 2004 —
Housing and Urban Development (HUD) Secretary Alphonso Jackson today unveiled HUD's simplified SuperNOFA, a notice that makes available $2.3 billion in funding opportunities to help produce more affordable housing, assist homeless individuals and families, and promote community development. The Fiscal Year 2004 NOFA includes 49 separate funding opportunities that will help states, local governments and not-for-profit organizations house and serve low-income families living in their communities.
WASHINGTON, D.C. — May 14, 2004 —
The U.S. Senate on Tuesday, May 11 approved S 1637, the Jumpstart Our Business Strength Act, by a vote of 92-5. The bill will now go to The House of Representatives. The JOBS Act extends $50 million in new market tax credits to Native American Reservations. The Indian economic development measures in the JOBS bill would also provide a tax credit for employing Native Americans, accelerate depreciation for business property on reservations and extend and expand a tax credit for wind-powered electricity produced on reservations. In addition, the bill gives tribes broader authority to issue tax-exempt bonds, establishes a new category of Qualified Tribal Modernization Bonds and provides a tax credit to bond holders, as long as 95 percent or more of the net proceeds are used to rehabilitate Bureau of Indian Affairs schools.
WASHINGTON, D.C. — May 13, 2004 —
The CDFI Fund has updated the allocation agreement Q&A document. The New Markets Tax Credit Allocation Agreement Q&A Document, dated May 2004, includes answers to general compliance questions, as well as answers to questions on Sections 3.2 (Uses of NMTC Allocation); Section 6.5 (Reporting); Section 6.8 (CDE Certification); and Section 9.11 (Amendments). Click here to access the Q&A.
WASHINGTON, D.C. — May 10, 2004 —
Treasury Secretary John W. Snow today announced the appointment of Arthur A. Garcia to serve as director of Treasury's Community Development Financial Institutions (CDFI) Fund. As director of the CDFI Fund, Garcia will oversee the expansion of access to capital and financial services in critically under-served urban, rural and Native American communities. Before this appointment, Garcia served as the administrator of the Rural Housing Service (RHS) at the U.S. Department of Agriculture (USDA) since April 2002. For more information, click here.
WASHINGTON, D.C. — May 6, 2004 —
The Treasury Department today announced that the Community Development Financial Institutions (CDFI) Fund awarded $3.5 billion in allocations under the New Markets Tax Credit (NMTC) program. Sixty-two community development entities (CDEs) were selected to receive NMTC allocations through the consolidated 2003-2004 round. A total of 271 CDEs applied for allocations, requesting an aggregate $30.4 billion in credits. Of the total applicant pool, 23 percent were successful. The average award is approximately $56,450,000 per allocatee. Allocations range in size from $2 million to $150 million and the median allocation award amount is $50 million. Click here for more information, including lists of allocatees and the areas they serve.
WASHINGTON, D.C. — May 5, 2004 —
The New Markets Tax Credit (NMTC) Coalition has learned that the Community Development Financial Institutions (CDFI) Fund is notifying Congressional offices about NMTC allocations in their states and districts. Preliminary reports suggest the CDFI Fund made 62 allocations for the total $3.5 billion in NMTCs available in the second round. Treasury Secretary John W. Snow will announce recipients of NMTC awards tomorrow at 1:30 p.m. (CDT) at the Johnson Building, 555 Main Street in Racine, Wis. Details will be available immediately following their release at www.newmarketscredits.com. Snow is also expected to speak at a second New Market Tax Credit press conference at 11:30 a.m. (CDT) at the Pablo Friere Child Care Center in Chicago, Ill. on Friday.
April
WASHINGTON, D.C. - April 23, 2004 -
Rep. Ernest Istook (R-Okla.) yesterday introduced H.R. 4193, a bill to amend the Internal Revenue Code to allow for the expansion of areas designated as renewal communities based on 2000 Census data and to treat certain census tracts with low populations as low-income communities for purposes of the new markets tax credit. Upon introduction, the bill was referred to the Committee on Ways and Means.
WASHINGTON, D.C. - April 13, 2004 -
Last week Congress confirmed the appointment of Brian Roseboro as Under Secretary for Domestic Finance, an office of the Treasury Department that includes the Community Development Financial Institutions Fund (CDFI) Fund. Roseboro was preceded by Peter Fisher who resigned in October 2003. Previous to this appointment, Roseboro served as assistant secretary for financial markets within the Office of Domestic Finance.
WASHINGTON, D.C. — April 12, 2004 —
The number of community development entities (CDEs) certified by the Community Development Financial Institutions (CDFI) Fund has risen to 1,408 as of April 9.
COMLUMBIA, Md. — April 5, 2004 —
ESIC Realty Partners Inc. (ERP), a subsidiary of The Enterprise Social Investment Corporation, last week announced the closing of its first New Markets Tax Credits (NMTC) transaction with the issuance of $45 million into four funds: ESIC New Markets Partners Funds I - IV Limited Partnerships. Through these four community development entities (CDEs), ERP will fund various commercial real estate development and housing projects located in Baltimore, Md., Columbus, Ohio, San Diego, Calif., St. Louis, Mo. Providence, R.I., and Newark, N.J. The issuance was completed on March 5, 2004, the date by which allocatees were required to have issued at least 50 percent of their first-round qualified equity investments (QEI) in order to be considered for the second round of NMTC allocations. ERP has applied for an additional $675 million in tax credit investment authority for the 2004 allocation round. Click here for more information.
March
WASHINGTON, D.C. - March 29, 2004 -
Effective immediately, the Community Development Financial Institutions (CDFI) Fund will require all applicants applying for federal assistance to have a Dun & Bradstreet (D&B) Data Universal Numbering System (DUNS) number assigned to their organization. The CDFI Fund has incorporated the DUNS number as an eligibility requirement for all federal assistance CDFI programs in accordance with a policy directive issued last year by the Office of Management and Budget (OMB). Click here for instructions on how to obtain this number by phone or online.
WASHINGTON, D.C. - March 25, 2004 -
In Notice 2004-26, the Treasury Department and Internal Revenue Service (IRS) invite public comment and suggestion for items to be included on the agencies' 2004-2005 Guidance Priority List. Treasury's Office of Tax Policy and the IRS use the guidance priority list each year to identify and prioritize the tax issues that should be addressed through regulations, revenue rulings, revenue procedures, notices and other published administrative guidance. The 2004-2005 Guidance Priority List will establish the guidance that the Treasury Department and IRS intend to issue from July 1, 2004, through June 30, 2005. Click here for a copy of Notice 2004-26 and instructions for submitting comments.
WASHINGTON, D.C. — March 24, 2004 —
Federal Home Loan Bank (FHLBank) of Atlanta announced today that it has awarded to two member financial institutions the first $100,000 recoverable grants through the bank's New Markets Fund program. FHLBank Atlanta created the New Markets Fund in 2002 to prompt greater participation among its members in the New Markets Tax Credit (NMTC) program. Treasury Bank, NA of Alexandria, Va. was awarded a grant to invest in CFBanc Corporation, whose mission is to promote investment in and strengthen underserved communities in Washington, D.C., by providing credit, financial services and access to information for individuals and businesses. Heritage Bank & Trust of Norfolk, Va. was awarded a grant to invest in Hampton Roads Ventures LLC, which provides low-interest capital to businesses, located in low-income communities or businesses owned or operated by low-income persons, to support the economic and community development goals of Norfolk, Va. Click here for more information. Additional details will also be available in the May issue of the NMTC Monthly Report.
WASHINGTON, D.C. — March 17, 2004 —
As of March 8, 2004, 29 new markets tax credit (NMTC) allocatees reported that they have issued qualified equity investments (QEIs) for a total of $473 million from investors, according to testimony Wayne Abernathy, Treasury Department Assistant Secretary for Financial Institutions. Abernathy's testimony was given before the House Appropriations Subcommittee on VA, HUD and Independent Agencies, on the fiscal year 2005 budget request for the Community Development Financial Institutions (CDFI) Fund. Treasury projects that 45 percent of the CDFI Fund's total administrative costs in FY 2005 will relate to the NMTC program. Abernathy also testified that in FY 2005, the CDFI Fund will engage an independent contractor to conduct an independent, multi-year evaluation of the NMTC program that will rely on data from the Community Investment Intelligence System (CIIS), as well as other data sources. Click here for more information.
WASHINGTON, D.C. — March 11, 2004 —
The Internal Revenue Service (IRS) today published revisions to the New Markets Tax Credit (NMTC) regulations. The proposed regulations include changes to the business control test for community development entity (CDE) investments and the employee services test for qualified active low-income community businesses. Comments will be accepted on the proposed rules through May 10 and a public hearing has been scheduled for June 2, 2004. Click here for the proposed amendments to the temporary regulations.
WASHINGTON, D.C. — March 10, 2004 —
Community Reinvestment Fund (CRF) yesterday announced that it has closed its first New Markets Tax Credit (NMTC) transaction with affiliates of The Bear Stearns Companies Inc. (Bear Stearns). In the transaction, Commercial Lending LLC, a for-profit subsidiary allocatee of CRF, issued $82.5 million of qualified investments to Bear Stearns. At least 60 percent of Commercial Lending LLC's subsequent investments will be made in areas of greater economic distress, which include communities designated for redevelopment or those where poverty levels top 30 percent, income levels are less than 60 percent of median or unemployment rates are at least 1.5 times the national average. CRF says this landmark deal between a not-for-profit community development organization and a leading Wall Street firm represents the power of NMTC to foster unique economic development relationships that would not otherwise be possible. Click here for more information about the transaction.
WASHINGTON, D.C. — March 5, 2004 —
A lack of tax benefit data limits the ability of the U.S. Department of Housing and Urban Development (HUD) and the U.S. Department of Agriculture (USDA) to administer and evaluate the Enterprise Zone/Enterprise Community (EZ/EC) and Renewal Communities (RC) programs, according to a U.S. General Accounting Office (GAO) report, "Community Development: Federal Revitalization Programs Are Being Implemented, but Data on the Use of Tax Benefits Are Limited." The GAO recommends that HUD, USDA and the Internal Revenue Service (IRS) collaborate to identify the data needed to assess the use of the tax benefits; determine the cost effectiveness of collecting these data; document the findings of their analysis; and, if necessary, seek the authority to collect the data, to facilitate the administration, audit and evaluation of the EZ/EC and RC programs.
WASHINGTON, D.C. — March 3, 2004 —
Community investing loans providing financial products and services to low-income people and communities are as safe or safer than loans made to wealthier individuals and communities, according to a new National Community Capital Association (NCCA) study released last month by the Community Investing Program, a joint initiative of the Social Investment Forum Foundation and Co-op America. The study analyzes the performance of more than 100 community development financial institutions (CDFIs) in 2002 and reports that through the end of fiscal year 2002, the subject CDFIs provided more than $6.6 billion in cumulative financing, helping to create 185,874 jobs, 283,415 housing units and 3,849 community facilities. Click here for a copy of the study.
SAN FRANCISCO — March 2, 2004 —
This is reminder for first-round allocatees that applied for an allocation of new markets tax credits in the second round. First-round allocatees must issue and receive cash for 50% of qualified equity investments (QEI) related to the first round by Friday, March 5, 2004.
Further, an entity that controls a first-round allocatee, is controlled by the first-round allocatee or shares common management officials with the first-round allocatee must also have issued and received cash from its investors for 50% of its QEIs relating to the first round by March 5, 2004.
It is important to note that the Community Development Financial Institutions (CDFI) Fund will only count as "issued" those QEIs that have been recorded and finalized in the CDFI Fund's allocation tracking system by Friday, March 5, 2004.
February
WASHINGTON, D.C. - February 25, 2004 -
Assistant Treasury Secretary Wayne Abernathy announced today that Owen M. Jones has been named acting director of the Treasury Department's Community Development Financial Institutions (CDFI) Fund. Jones served as deputy director for management and chief financial officer of the CDFI Fund since July 1999, where he has been responsible for day-to-day administrative operations, grants management and compliance, portfolio management, information technology and all financial management activities for the CDFI Fund. Click here for more information.
WASHINGTON, D.C. - February 17, 2004 -
The Treasury Department today announced the departure of Community Development Financial Institution (CDFI) Fund Director Tony Brown from his position. Brown has been involved in community development for more than two decades. Appointed by President George W. Bush, he served as the director of the CDFI Fund since August 13, 2001. In a statement, Secretary John Snow thanked Brown for "attaining the maximum impact from the new $15 billion New Markets Tax Credit Program, [and implementing] President Bush's call for sustainable economic development, and attracting increased private sector investment to low income communities."
Meanwhile, Uptown Consortium, a new not-for-profit in Cincinnati, has hired Brown as its chief executive officer. Five Greater Cincinnati organizations - Cincinnati Children's Hospital Medical Center, Cincinnati Zoo & Botanical Garden, The Health Alliance of Greater Cincinnati, TriHealth Inc. and University of Cincinnati - formed the Uptown Consortium, an organization dedicated to the revitalization of the Uptown area of the city. Click here for details.
WASHINGTON, D.C. — February 11, 2004 —
The Community Development Financial Institutions (CDFI) Fund today posted updated lists of certified community development entities (CDEs). As of January 31, the CDFI Fund has certified 1,348 CDEs. Click here for the most recent lists.
WASHINGTON, D.C. — February 6, 2004 —
The Community Development Financial Institutions (CDFI) Fund has begun the process of bringing on new hires and expects to begin addressing the backlog in CDFI and community development entity (CDE) certifications, said CDFI Fund Director Tony Brown in his remarks to the CDFI Coalition yesterday at the 2004 CDFI Institute. Brown also announced that the CDFI Fund expects to have the Community Investment Impact System (CIIS), the vehicle through which compliance and performance data will be collected from the CDFIs and CDEs, fully operational by June 2004. Brown reported that in the process of developing the system, the technology firm EF Kearney has conducted telephone interviews with 92 CDFIs and CDEs and held three user-centered design sessions in which 17 CDFIs and six CDEs participated and provided feedback on the software application and the collection of transaction-level data. To read more of Brown's remarks, click here.
WASHINGTON, D.C. — February 2, 2004 —
To ensure that compliance monitoring processes for the New Markets Tax Credit (NMTC) program will be in place when needed, the General Accounting Office (GAO) has recommended that the Community Development Financial Institutions (CDFI) Fund and Internal Revenue Service (IRS) develop plans, including milestones, for designing and implementing compliance monitoring processes. In a report released today, the GAO describes the status of the NMTC program, profiles community development entities (CDE) that were selected to receive NMTC allocations in 2003, and determines whether systems are in place or planned to ensure compliance and evaluate the success of the NMTC program. Click here for a copy of the report.
January
WASHINGTON, D.C. - January 27, 2004 -
The Community Development Financial Institutions (CDFI) Fund today posted a document addressing frequently asked questions regarding allocatee compliance with the terms and conditions of the new markets tax credit (NMTC) allocation agreement. The document addresses four questions: one on sub-allocations and three regarding financial statements and other compliance requirements. Click here for a copy of the Q&A.
WASHINGTON, D.C. - January 15, 2004 -
The National Trust Community Investment Corp. (NTCIC) and Bank of America today announced that their organizations' joint efforts have resulted in the country's first reported investments utilizing new markets tax credits (NMTC), totaling more than $50 million invested in 10 projects around the nation, totaling $236 million in overall development costs. An additional $77 million in equity raised is already committed to other preservation projects. Click here for more information.
WASHINGTON, D.C. — January 7, 2004 —
A financial institution's investment in connection with the New Markets Tax Credit (NMTC) program in a community development entity (CDE), or a loan by a financial institution CDE to a qualified active low-income community business (QALICB) or another CDE, would receive consideration as a qualified investment or a community development loan, respectively, when the institution's Community Reinvestment Act (CRA) performance is evaluated, according to a letter released this week by the Office of the Comptroller (OCC). The letter from OCC's Community and Consumer Law Division Director Michael S. Bylsma concludes that such investments and loans would be favorably considered under the CRA. Click here for a copy of the letter.
WASHINGTON, D.C. — January 5, 2004 —
The Department of Treasury has submitted a public information collection requirement to the Office of Management and Budget (OMB) for review and clearance regarding the Development Financial Institutions (CDFI) Fund's New Markets Tax Credit (NMTC) Program Allocation Tracking System (ATS). The notice says the purpose of the NMTC Program ATS is to obtain information on investors making qualified investments in community development entities (CDEs) that receive NMTC allocations. Entities receiving NMTC allocations must enter into an allocation agreement with the CDFI Fund and that allocation agreement contains certain disclosure and reporting requirements. Click here for more information.