The Community Development Financial Institutions Fund (CDFI Fund) released yesterday data on New Market Tax Credit (NMTC) Investments for the past ten years. Over $31.1 billion in New Markets Tax Credits (NMTC) investments have revitalized low-income communities nationwide in the past decade. To maintain its practice of transparency, the CDFI Fund released a breakdown of all NMTC investments reported to the CDFI Fund through fiscal year (FY) 2012. The CDFI Fund has awarded in total $40 billion in NMTC Allocation Authority through calendar year 2013. Community Development Entities that receive NMTC Allocation Authority are required to report on the tax credits for seven years, and the time lag in reporting means that more recent awards are not accounted for in the public data release.
As mentioned before, the NMTC Program was established by Congress in December 2000 to help economically distressed communities attract private investment capital by providing investors with a Federal tax credit. Investments made through the New Markets Tax Credit Program are used to finance businesses and real estate projects in neglected, underserved low-income communities.
Of the investments made:
- 4,670 (57.9 percent) of the total number of NMTC investments, in the amount of $20,315,818,262 (65.3 percent), were in real estate development and leasing activities.
- 3,234 (40.1 percent) of the total number of NMTC investments in the amount of $10,224,240,295 (32.9 percent) were in operating businesses. A small fraction of investments in operating businesses, totaling $398,684, were in microenterprises.
- 156 (1.9 percent) of the total number of NMTC investments in the amount of $577,698,894 (1.9 percent) were investments in other financing purposes.