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NMTC Working Group Update: August 2013

Published by Rebecca Darling and Cyle Reissig on Thursday, August 1, 2013

Journal cover August 2013   Download PDF

The Community Development Financial Institutions (CDFI) Fund has officially opened the eleventh round of new markets tax credit (NMTC) allocation applications with the release of the notice of allocation availability (NOAA) on July 24. The NOAA combines the calendar year (CY) 2013 and CY 2014 rounds, making $8.5 billion in tax credit authority available, pending Congressional authorization of $5 billion in allocation authority requested in the president’s proposed 2014 budget. The CDFI Fund said it combined the rounds to achieve cost and efficiency savings; to realign the program calendar; to prevent an anticipated deficit of available NMTCs; and to allow them to make additional allocation awards. With the CY 2012 allocation awards just announced in April, should we anticipate a similar, or even earlier announcement timeline for the eleventh round? Or, might the combination of CY 2013 and CY 2014 rounds delay the announcement? While an award announcement timeline is currently uncertain, the CDFI Fund has said that if Congressional authority for the CY 2014 allocation authority is not enacted by early fiscal year 2014, it will proceed with making $3.5 billion in awards for CY 2013 only and would likely consider combining CY 2014 and CY 2015 authority, again pending Congressional authorization.

Each year the NMTC Working Group reviews the NOAA, application and the Q&A document published by the CDFI Fund. We provide members with a list of all changes, a fillable Microsoft Word version of the application, an Excel version of the tables, a redline comparison of the current and most recent applications, and a qualified equity investment (QEI) issuance calculator. There are minor changes throughout this round’s application, but the questions are substantively unchanged. However, entities that plan to submit an application in this round are strongly encouraged to carefully review the application and related application materials, which highlight several changes and clarifications.

Important dates for the 2013-2014 nmtc allocation application
Key dates included in the July 24 announcement include:

  • August 9– community development entities (CDEs) must apply for certification to be eligible for NMTC allocation
  • Sept. 18 – NMTC allocation application due
  • Sept. 20– Deadline for uploading investor letters, signature pages and organization charts
  • Dec. 31 – Deadline for prior round awardees to meet QEI issuance requirements

Novogradac & Company will host an NMTC application webinar on August 14. A replay of the webinar will also be made available online at In addition, the NMTC Working Group will be working to gain additional clarification in areas of the application that need it and we will share the guidance with group members. Good luck to all those who are applying for allocation!

With the Community Investment Impact System (CIIS) reporting deadline behind us (for those with a fiscal year end of December 31), many community development entities (CDEs) still have questions regarding the new multi-CDE project reporting requirements. The Community Development Financial Institutions (CDFI) Fund recognized that many larger and high impact projects are financed with allocations from multiple CDEs. Previously, each CDE involved in a transaction would typically report all project information, including outcomes, and thus the data collected by CIIS was overstated. In an effort to collect more accurate information and improve the integrity of the data collected, the CDFI Fund introduced the multi-CDE reporting requirement in CIIS 10.0.

The CDFI Fund provided additional instructions and clarification at the end of March, but many CDEs continue to have questions. The NMTC Working Group is submitting a list of questions and recommendations to the CDFI Fund, as well as considering a list of recommended practices. The comment letter includes questions, such as are there specific source documents the CDFI Fund would like the CDEs to maintain to support the information entered in CIIS? Additionally, the letter requests further clarification regarding working capital qualified low-income community investments (QLICIs), multi-phase transactions and transactions that close with qualified equity investments (QEIs) over more than one year, and multi-CDE transactions in which the CDEs have different reporting year ends. The letter also includes recommendations to the CDFI Fund to improve the efficiency of the reporting. For example, many believe that under the lead approach, it would be beneficial if the information the lead CDE submits in CIIS is visible to the other CDEs in the transaction or if the project information and outcomes could be automatically populated into each CDE’s Transaction Level Report (TLR). Similarly, under the collaborative approach, it would be beneficial if the initiating CDE could enter the QEI amounts from each CDE and the total project outcome data and CIIS would automatically allocate the data on a pro-rata basis to the CDEs in the transaction. These recommendations would eliminate duplicate efforts by CDEs when reporting on multi-CDE transactions, reducing the overall burden of reporting.

Stay tuned for additional information and clarification regarding the multi-CDE reporting requirements and other technical and programmatic issues. All of the NMTC Working Group’s comment letters and recommended practices that are publicly available can be found at In addition, there is also information about joining the NMTC Working Group, or submitting public input on these topics without formally joining the group.

Are you an allocatee, investor, lender or QALICB? Would you like to be part of our group and get the inside track on issues affecting the NMTC program? Are you a professional that works with NMTC industry participants? Do you have questions about technical program issues you are dealing with? Do you have a great community impact project struggling with a technical issue and can’t move forward until the issue is resolved? Join the NMTC Working Group and add your issues to the agenda and be part of a strong and active voice in the NMTC industry. For more information about becoming a member please contact Cyle Reissig at [email protected]. Additionally, the NMTC Working Group does consider input from non-members when drafting comment letters, recommended practices and other content. To submit input on a NMTC topic, contact Cyle Reissig at [email protected].

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