Community Builders
New Markets Tax Credits in the News
September 19, 2022
The New Markets Tax Credit (NMTC) Program is a federal financial program developed by the United States Department of the Treasury to incentivize community development using federal tax credits allocated by private investors in disadvantaged and distressed communities. In this blog, LifeCity will discuss key developments related to the NMTC Program.
News
NMTC Conference
Novogradac’s Fall 2022 NMTC Conference is coming up on October 27-28 at the InterContinental New Orleans. To register for this event, log in to your Novogradac account here. If you have additional questions, contact events@novoco.com or call (415) 356-7970 to learn more. Access the full agenda for the conference here.
Criteria to be designated a minority lending institution
On July 28, 2022, the CDFI Fund published a request for comments regarding criteria to become a Minority Lending Institution (MIL), which may be implemented to award CDFIs that provide high levels of service to minority communities. An MIL is currently known as a CDFI that directs the majority of its financial products to Minority populations, is a Minority Depository Institution, or demonstrates some example of accountability to Minority populations. Comments on this designation must be submitted by November 25, 2022.
Projects
The Community Builders
Columbus Metropolitan Housing Authority and The Community Builders recently announced plans to purchase a United Way site in Columbus, OH by the end of the year. This project, an apartment complex that will include 135 affordable and market-rate apartments and commercial space, is expected to be completed by 2026 and will cost around $70 million. Out of the 135 units, households earning a certain income will be able to rent a specific percentage of the total units. For example, households earning less than $40,000 have access to 15% of the units. Furthermore, each household will have an adjusted rent amount. The Community Builders, a national nonprofit organization, aims to provide affordable housing options to the city of Columbus that will address the needs of the low-income community struggling to pay high rent costs. To fund this project, The Community Builders is utilizing a variety of sources, such as New Markets Tax Credits, low-income housing tax credits, and bank financing.
Rhino Health USA
On July 29, 2022, Rhino Health USA, Inc. announced that its $200 million investment for expansion in Texas will be partially funded by $58 million in NMTCs. Rhino Health USA created the first nitrile glove produced in the United States. The company is currently partnered with the Navajo Nation. Its production facility is located in Church Rock, NM, which provides job opportunities to members of the Navajo Nation. Rhino Health USA plans to build its largest facility to date in Majestic Fort Worth South Business Park and also plans to move its headquarters to this location upon completion. This project will create 520 new quality jobs in Fort Worth. The NMTC financing was made by five CDEs (Texas Mezzanine Fund, Stonehenge Community Capital, Prestamos CDFI, Pacesetter CDE, and MBS Urban Initiatives) and will pay for equipment and working capital. The NMTC investment was made by U.S. Bancorp Community Development Corporation.
Our House
On August 17, Our House announced that it will receive a $10 million NMTC financing package that enables Our House to double its housing capacity for families who are homeless in Central Arkansas. In addition to an expansion of its capacity, Our House will also be able to offer a larger child care and youth development programs and to expand mental and physical health services. By adding over 27,000 square feet, Our House will be able to serve an additional 250 adults and children daily and can serve the 200 children on the waiting list. The facility will open in Fall 2023 and will create 43 permanent full-time jobs in the coming few years. The NMTC allocation was supplied by the Heartland Renaissance, the project's sole CDE, and the financing for the project was completed by Arkansas Capital Corporation, a significant NMTC supporter in Arkansas.
These inspiring projects and more are underway across the US. LifeCity specializes in impact assessments and third-party validation services for CDEs engaged in NMTC-financed projects. As a third-party, we help CDEs and other companies measure, manage, track, and report their impact to ensure a credible and transparent message. Our services are available across all stages of the NMTC allocation process and provide personalized impact reports and videos that support clients, projects, and communities.