U.S Treasury Department Announces $3.5 Billion in Latest Round of New Markets Tax Credits Awards

The New Markets Tax Credits Program (NMTC Program) was established by Congress in 2000 to encourage new or increased investments and job creation in low income communities (LICs.)  Use of these credits can reduce the effective capital cost of an investment in a facility located in a qualified LIC by as much as 20%.

Last week, the U.S. Treasury Department announced the latest round of NMTC awards.  Eighty-five community development entities (CDEs) have been selected to receive $3.5 billion in tax credits in this, the tenth round of the NMTC Program.  Once again, competition for these awards was intense.  The 85 CDEs receiving awards were selected from a pool of 282 applicants who had requested more than $21.9 billion in credits.

incentis group offers NMTC Advisory Services to companies or non-profit organizations who are seeking to use these tax credits to support their investments in qualified low income communities in the U.S.  Our extensive network of CDEs and investors are actively seeking projects which would qualify for NMTC support.  NMTC can be, and has been, used to support construction of a new facility, rehabilitation or expansion of an existing facility, equipment upgrades, or additions to working capital.  Some recent projects for which incentis group arranged NMTC support include:

• An expansion of a distribution center in the rural Midwest garnered a $10,000,000 allocation resulting in a $1,500,000 benefit for the project sponsor. 
• Projects in the Southwest both developed retail in underserved areas.  The first project received a $12,500,000 allocation for a $2,250,000 benefit.  The second used a $16,000,000 allocation to provide a benefit of $3,500,000. 
• A manufacturing facility in the Southwest was awarded a $10,000,000 allocation to produce a project benefit of $1,400,000. 
• A project in the Southeast bringing retail in an underserved area received an $8,500,000 allocation resulting in an approximately $1,300,000 benefit for the project sponsor.
• A project in the Midwest brought retail into an underserved area.  The project received a $9,000,000 allocation resulting in an approximately $2,000,000 benefit for the project sponsor.

If you are considering investment and you would like to see whether your project would qualify for these valuable tax credits, please contact Larry Kramer (lkramer@incentisgroup.com), James Gomochak (jgomochak@incentisgroup.com), or Jessica Thompson (jethompson@incentisgroup.com).