NEW ORLEANS–Seventy organizations have been selected to receive $3.6 billion in New Markets Tax Credit (NMTC) awards, announced federal officials Feb. 23.
“For so many vital economic development projects across the country, the NMTC has been a critically important piece of the puzzle,” said Treasury Department Deputy Secretary Neal Wolin. “This targeted tax credit has a strong record of spurring economic growth in low-income and distressed communities across our country.”
Wolin and other officials made the announcement at Federal City Town Center, a retail complex that is the heart of a 155-acre redevelopment of the former Naval Support Activity New Orleans military base. NMTCs were used to transform the base.
Five organizations in Louisiana are receiving NMTC awards under the 2011 round.
A number of organizations familiar to the affordable housing industry were selected, including the Local Initiatives Support Corp., Low Income Investment Fund, Massachusetts Housing Investment Corp., The Community Builders, Travois, and Housing Vermont.
Established by Congress in December 2000, the NMTC program permits individual and corporate taxpayers to receive a credit against federal income taxes for making equity investments in investment vehicles known as community development entities (CDEs). The credit provided to the investor totals 39 percent of the cost of the investment and is claimed over a seven-year period. CDEs must apply to the Treasury’s CDFI Fund to compete for this allocation authority.
The 70 organizations receiving awards this year were selected from a pool of 314 applicants that requested more than $26.7 billion. They are headquartered in 29 different states and the District of Columbia but have identified principal service areas that will cover nearly every state in the country, as well the District of Columbia.
Although the NMTC program has received good support, it has an uncertain future. Congress has yet to re-authorize it for 2012.