WASHINGTON, July 18, 2019 /PRNewswire/ -- The New Markets Tax Credit Coalition today released its 2019 New Markets Tax Credit (NMTC) Progress Report, the fifteenth edition of the report—providing analysis of NMTC activities in 2018. The report documents the importance of the NMTC in providing patient, flexible capital to businesses and projects located in distressed rural and urban communities, thereby creating jobs and growing business opportunities. The NMTC financing ranges from more traditional industry and community sectors to new and cutting-edge technology. Projects and businesses that benefited from the Credit in the past year include manufacturing, healthcare, schools and many supporting childcare, youth, and families.
The report was prepared for the NMTC Coalition, a national membership organization of Community Development Entities (CDEs) and investors organized to advocate on behalf of the NMTC. Every year since 2005, the NMTC Coalition surveys CDEs on their work delivering billions of dollars to businesses, creating jobs, and rejuvenating the parts of the country that have been left behind. The annual NMTC Progress Report presents the findings of the CDE survey and provides policymakers and practitioners with the latest trends and successes of the NMTC.
"The Coalition's annual survey asks CDEs to report on the deployment of their allocation, investor trends, and a variety of community impact metrics," said Coalition spokesperson Bob Rapoza. "The findings clearly demonstrate that the NMTC continues to deliver capital to the communities left behind by the changing economy, with nearly 80 percent of the activity in severely distressed U.S. census tracts in the last year—far exceeding statutory requirements. Moreover, the Credit is delivering a significant 'bang for the buck' for taxpayers in terms of the jobs, amenities, community facilities, and tax revenue."
Seventy-four CDEs participated in the 2019 survey and provided data on their progress raising capital, lending, and investing in 2018 with the NMTC. The survey findings show that competition for credits continues to drive gains in efficiency. The data collected shows that CDEs used $3.2 billion in NMTC allocation in 2018 to finance 286 NMTC projects, amounting to $6.1 billion in total project investment to low-income communities. This financing resulted in the creation of 58,360 total jobs including 32,917 permanent full-time-equivalent jobs and 25,443 construction jobs.
"Year after year, the data shows the NMTC not only delivers an unprecedented level of capital to low-income rural and urban communities, but it creates much-needed jobs—helping individuals and families thrive and, in turn, grows those local economies where they live and work. In fact, since 2003 the NMTC has created over one million jobs," Rapoza adds.
Across 48 states and territories, CDEs rehabilitated or constructed 18.9 million square feet of space in 2018, thanks to NMTC financing. NMTC financing supported 193 manufacturing and industrial businesses with loans for working capital, new equipment, and 6.7 million sq. ft. of new space, often through incubators and multi-business facilities, creating over 12,000 manufacturing jobs.
Furthermore, there were four million people served by NMTC-financed community facilities including 445,000 patients in healthcare facilities and 460,000 children. Sixty-six percent of mixed use projects included at least one community facility, nonprofit, or social service component. Those new community resources add up to 249 nonprofit facilities, health centers, childcare centers, libraries, community centers, and other community facilities. The report profiles NMTC financed businesses, including a rural apparel manufacturer in Pagosa Springs, CO, a new Educare facility in Springfield, MA, and a Boys and Girls Club in Manatee County, FL, and it describes the impact of the NMTC in native communities in 2018.
Rapoza notes, "The authorization for the NMTC expires this year. This report is further proof that the Credit is working and Congress should expand and make the NMTC permanent."
There is currently legislation in Congress aimed at making the NMTC permanent, The NMTC Extension Act of 2019, H.R. 1680 in the House and S. 750 in the Senate. There are presently 30 Senators signed on in support of S. 750, which was introduced by Senators Roy Blunt (R-MO) and Ben Cardin (D-MD). H.R. 1680 has 91 cosponsors, and is led by Reps. Terri Sewell (D-AL) and Tom Reed (R-NY).
About New Markets Tax Credit Program The New Markets Tax Credit was enacted in 2000 in the Community Renewal Tax Relief Act (P.L.106-554) in an effort to stimulate private investment and economic growth in low-income urban neighborhoods and rural communities that lack access to the patient capital needed to support and grow businesses, create jobs, and sustain healthy local economies. The NMTC is a 39 percent federal tax credit, taken over seven years, on investments made in economically distressed communities. More than $95 billion in capital has been put to work in underserved communities in all 50 states, the District of Columbia, and Puerto Rico.
SOURCE New Markets Tax Credit Coalition