As supporters seek reauthorization of the New Markets Tax Credit (NMTC) program, the sixth round of allocations has opened, with applications due March 5.
Applicants will compete for tax credits on $3.5 billion of equity investments under the federal program.
This year’s round will have an emphasis on placing investments in underserved rural communities.
“It’s a very competitive program,” said Donna Gambrell, director of the Community Development Financial Institutions (CDFI) Fund, which administers the NMTC program. “The competition is increasing, and the number of applicants is increasing.”
When applying for an allocation, organizations need to show the impact they will have in the communities they plan to serve, advised Gambrell.
Applicants should be specific in their applications about how communities will benefit, she said.
Officials also stressed the March 5 application deadline. They recommend that applicants get their forms in early in case they run into any technical difficulties with filing their submissions. Awardees are scheduled to be announced in the fall.
Program supporters are pushing Congress to reauthorize the NMTC program. Without an extension, 2008 would be the final allocation round for the program, which has made 294 awards totaling $16 billion in allocation authority since its beginning.
In 2007, 61 organizations were selected to receive $3.9 billion in tax credits, including $400 million in NMTCs for use in the Hurricane Katrina Gulf Opportunity Zone.
Gambrell said one of the strengths of the NMTC program has been its flexibility in financing different types of projects and economic programs, which encourage investments in low-income communities.
She cited the recent opening of a Giant supermarket in Washington, D.C., which is part of a mixed-used development that was financed with the help of NMTCs. The project, which was developed by the William C. Smith Co. and East of the River Community Development Corp., brings the first new grocery store to the neighborhood in a decade. The new Giant is also providing 200 jobs for local residents. The Local Initiatives Support Corp. provided about $18.6 million in NMTCs for the construction of the shopping center. The investment was made in partnership with Wachovia.
Gambrell joined the CDFI Fund at the end of November 2007. She said she is unlike prior CDFI Fund directors because she is a career employee and not a political employee.
In the past, directors have come and gone when there has been a change in White House administrations. Gambrell has a three-year appointment to lead the CDFI Fund, which is expected to provide the agency with continuity through the upcoming elections.
She replaced Kimberly Reed, who resigned as head of the CDFI Fund last year.
Gambrell previously served at the Federal Deposit Insurance Corp. (FDIC) as deputy director of consumer protection and community affairs in the Division of Supervision and Consumer Protection. She joined the FDIC in 1991 as a community affairs officer for the New York region.
A little more than a month into her new job, she cited several initial goals, including seeing the CDFI Fund become more of a “knowledge leader” by analyzing and sharing the data that it collects.
Gambrell said she also wants to look at the pool of qualified applicants that are competing for CDFI Fund awards and explore ways to reach the widest variety of organizations.