NMTC Demand in 12th Round Exceeds Supply by Nearly 4:1

Published by Michael Novogradac on Tuesday, October 7, 2014 - 12:00am

The new markets tax credit (NMTC) may have technically expired on Dec. 31, but that point hasn’t dampened interest in this important community development tool. Demand for the new markets tax credit program remains steady, as evidenced by today’s announcement from the CDFI Fund that it received 263 applications for the 2014 allocation round.

The 2014 notice of allocation authority makes up to $5 billion in tax credit allocation authority available for the current round, pending Congressional authorization. Applications for the 12th round were due Oct. 1.

Here’s a look at how this round’s demand compares to the historical NMTC applications and allocations:

 

Blog Chart NMTC Application Demand
Click to Enlarge

 

While demand for the 12th round is appears lower than that for the 11th round, this is in part because the 11th round was originally opened as a combined allocation application round for calendar years 2013 and 2014 for as much as $8.5 billion in allocation authority, pending congressional approval. Demand in the 11th round at the time of the application deadline outstripped supply by a ratio of 3 to 1.

Because Congress only extended the NMTC for 2013, a new NOAA was issued for the calendar year 2014 round for which as much as $5 billion in allocation authority will be awarded, pending congressional approval. Demand for the 12th round exceeds supply by nearly 4 to 1.

To prepare for the next NMTC allocation round, join us at the Novogradac New Markets Tax Credit Conference on Oct. 23-24 in New Orleans.