The Community Development Financial Institutions (CDFI) Fund today announced the allocation of $5 billion in new markets tax credit (NMTC) authority for the calendar year 2022 (CY 2022) allocation round. One-hundred-and-two community development entities (CDEs) received allocations. The CDEs are located in 36 states and the District of Columbia. More than 20% of the investments are slated for rural communities. According to the CY 2022 NMTC Program Award Book, 49 of this year’s awardees will focus investment activities on a national service area, 20 will focus on a multi-state area, 18 will focus on a specific state and 15 will focus on specific local markets. The award amounts range from $20 million to $65 million.
The Community Development Financial Institutions (CDFI) Fund will publish a notice in Friday’s Federal Register requesting comment on the updated application questions for the CDFI program, Native American CDFI Assistance (NACA) program and the CDFI Fund’s financial assistance and technical assistance programs. The revised programs application questions have been modified to reflect public comments received through a previous request for public comment. Comments are due by Oct. 23.
The Community Development Financial Institutions (CDFI) Fund today announced a transaction-level report (TLR) deadline extension to Dec. 31, 2023, for new markets tax credit (NMTC) award allocatees with a TLR due date between Aug. 31, 2023, and Nov. 30, 2023.
The Community Development Financial Institutions (CDFI) Fund today announced its release of updated eligibility data for the new markets tax credit (NMTC) incentive. The updated information on low-income communities (LICs) is based on 2016-2020 American Community Survey (ACS) five-year estimate data from the U.S. Census Bureau. The new data may be used as of today (Sept. 1). The CDFI Fund also published information on the transition from 2011-2015 to 2016-2020 data, based on the date the qualified low-income community investment (QLICI) closes. Similar information on island areas֪–not included in this release–is tentatively scheduled for release in December. The New Markets Tax Credit Working Group will analyze the data and transition guidance.
More than 500,000 construction jobs were created or retained by new markets tax credit (NMTC) investments through fiscal year 2021 (FY 2021), according to a Community Development Financial Institutions (CDFI) Fund summary report released today.
The Internal Revenue Service (IRS) will publish in Friday’s Federal Register a notice and request for comments concerning recapture events for the new markets tax credit (NMTC). The notice reviews the current requirement that community development entities (CDEs) provide notice to any taxpayer holder of a qualified equity investment (QEI) that a recapture event has occurred. The IRS seeks feedback on the current form. Comments are due by Oct. 10.
The Community Development Financial Institutions (CDFI) Fund today announced that beginning with the fiscal year 2023 (FY 23) Small Dollar Loan Program funding round, award applicants for most programs must complete a Title VI compliance worksheet, verifying that they don’t discriminate against program participants due to their race, color, national origin, disability or age. If the CDFI Fund’s assistance is for an educational program, award recipients are also prohibited from discriminating against participants because of their sex. The requirement does not apply to the New Markets Tax Credit program nor the CDFI Bond Guarantee program. For covered programs, all awardees and their prospective sub-recipients that are not direct beneficiaries of federal financial assistance must complete the worksheet once annually. Organizations that apply to multiple programs only need to submit one worksheet annually. The CDFI Fund offers a recorded webinar providing an overview of the worksheet.
Rep. Carol Miller, R-West Virginia, this week introduced the Rural Jobs Act in the House of Representatives. The bill would provide $1 billion of new markets tax credit (NMTC) allocation over the next two years for rural areas. The House version of the legislation’s text was not immediately available, but it is expected to be identical to a version introduced in the Senate in May. That legislation would provide $500 million per year in NMTC allocation for 2023 and 2024 for Rural Jobs Zones, which are NMTC-eligible census tracts in rural communities with fewer than 50,000 residents. At least $250 million of the $1 billion in allocation would be designated for persistent poverty counties and high out-migration rural counties.
The Community Development Financial Institutions (CDFI) Fund will publish in Thursday’s Federal Register a notice and request for comment on changes to the new markets tax credit (NMTC) program transaction level report (TLR), seeking to revise data points on fees and transaction costs as well as measuring the depth of public subsidy in NMTC transactions. Additional measures seek to provide new data points to gauge community outcomes during the application process as well as assess compliance with the allocation agreement. The CDFI Fund considered similar revisions to the TLR earlier this year. Comments are due by Aug. 26.
The Community Development Financial Institutions (CDFI) Fund will publish a notice in Friday’s Federal Register seeking comments on the Capital Magnet Fund (CMF). The notice seeks feedback on how the CDFI Fund can enhance and improve the CMF, streamline or minimize the administrative burden on applicants, and safeguard public funds. Comments must be received on or before Sept. 5. CMF awards go to CDFIs and nonprofit organizations for the development, preservation, rehabilitation and purchase of affordable housing for extremely low, very low and low-income families or for economic development activities in conjunction with affordable housing activities that implement a strategy to stabilize or revitalize a low-income or underserved rural area.
The Community Development Financial Institutions (CDFI) Fund today released fiscal year 2021 data for active recipients in its CDFI program and Native American Community Assistance (NACA) program.
Legislation signed into law this week by Louisiana Gov. John Bel Edwards provides $150 million in qualified equity investment (QEI) authority for the state new markets tax credit (NMTC) and makes other changes to the incentive. S.B. 151 provides the additional QEI authority beginning Aug. 1 and requires tax credit recapture if all investment isn’t made within 12 months. The Louisiana NMTC is for 45% of QEIs taken 14% in Years 1 and 2 and 8.5% in Years 3 and 4.
Nevada Gov. Joe Lombardo recently signed legislation that increases the overall amount of qualified equity investments (QEIs) allowed under the state’s new markets tax credit (NMTC) incentive and adds a new “impact QEI” with a higher credit amount. S.B. 240 adds $170 million in QEIs for the period of July 1, 2024, through July 1, 2026, to the total allocation amount. Impact QEIs include those made by community development entities (CDEs) in certain types of manufacturing businesses or businesses in which the majority of owners are from certain historically disadvantaged groups. While the state NMTC is worth 58% over seven years, an impact QEI creates NMTCs that are worth 75% over seven years. The bill also precludes QEIs made July 1, 2024, through July 1, 2026, from being used as tax credits against insurance premium tax.
Budget legislation in Illinois that took effect last week makes changes to the state new markets tax credit (NMTC), historic tax credit (HTC), River Edge Redevelopment Act and other issues. S.B. 1963 includes provisions that change the sunset date for the state NMTC to the end of fiscal year 2031 and retain the annual statewide allocation amount of $20 million for fiscal years beginning before July 1, 2023, going to $25 million thereafter.
Legislation signed into law May 31 by Florida Gov. Ron DeSantis repeals multiple state tax credit incentives as of July 1, including its new markets tax credit (NMTC) incentive. HB5 strikes six Florida tax credit initiatives. New applications for the state NMTC will cease as of July 1, but existing contracts and agreements prior to that date will continue. Other repealed credits include an entertainment industry tax credit program and two related to space flight.
Legislation to provide an additional $1 billion in new markets tax credit (NMTC) allocation annually for two years was introduced in the U.S. Senate. The Rural Jobs Act (S. 1455) would provide $500 million in allocation in 2023 and again in 2024 for Rural Jobs Zones, which are NMTC-eligible census tracts in rural communities with fewer than 50,000 residents. At least $250 million of the total allocation would be prioritized for persistent poverty counties and high out-migration rural counties. The bill is expected to be introduced in the House of Representatives soon. This is the third consecutive session of Congress in which similar legislation was introduced.
One-hundred and forty-four organizations requested more than $1.1 billion in fiscal year (FY) 2023 round Capital Magnet Fund (CMF) financing, according to an update from the Community Development Financial Institutions (CDFI) Fund released today.
Nevada legislation would increase the overall amount of qualified equity investments and make other changes to the state new markets tax credit (NMTC) incentive. S.B. 240 would add $170 million in in QEI investments made after July 1, 2024, (for which tax credits could not be taken before July 1, 2026) to the total allocation amount and add a definition of “impact qualified active low-income community business” to mean certain types of manufacturing businesses or businesses in which the majority of owners are from certain historically disadvantaged groups. The Nevada NMTC is for 58% of the QEI, with 0% in the first two years, 12% annually in Years 3-5 and 11% annually in Years 6-7.
The Community Development Financial Institutions (CDFI) Fund today announced that it expects to open the new CDFI certification process in the fall. The updated certification process was originally scheduled for this spring, but was postponed in January. Over the coming months, the CDFI Fund will continue to review comments, publish an updated application form, conduct public outreach, enhance the infrastructure on its Awards Management Information System (AMIS) for data and material submission, and institute a grace period for currently certified CDFIs to complete the new certification application. Certified CDFIs are still required to submit an annual certification and data collection report in accordance with their existing schedule.
Bob Ibanez, a senior manager in the public policy group of Novogradac, passed away April 19. Ibanez was an esteemed member of the Novogradac team and a dedicated leader in the field of community development. For five years with Novogradac, Ibanez helped clients in the new markets tax credit (NMTC) and community development financial institutions (CDFI) communities. Before joining Novogradac, Ibanez spent 13 years at the CDFI Fund, the final six as program manager of the NMTC and Bank Enterprise Award programs.
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