$35 Million in New Markets Tax Credits Awarded to Support Community Development
(DENVER) - The Colorado Growth and Revitalization Fund (CGR Fund), administered by Colorado Housing and Finance Authority (CHFA), announced today it has been awarded $35 million in New Markets Tax Credits (NMTC). The U.S. Department of the Treasury’s Community Development Financial Institutions Fund (CDFI Fund) awarded $5 billion in NMTC to 100 entities throughout the nation.
NMTC are designed to generate private-sector investment in underserved communities by supporting local businesses or nonprofits that directly benefit current residents, by either hiring from within the community, and/or providing community services. The CGR Fund uses NMTC to support projects such as community facilities, mixed-use developments and businesses that pay living wages.
“Investment made possible by NMTC is especially critical at this point in time when communities are facing unique hardships as a result of the pandemic. The CGR Fund will use the NMTC award to invest in developments that will aid in pandemic recovery (specifically job creation), healthcare, and education in underserved communities,” said Cris White, CHFA executive director and CEO.
In addition to the NMTC award announced today, the CGR Fund has received NMTC awards totaling $180 million in prior rounds. The CGR Fund’s deployment of NMTC to date has resulted in more than 5,900 jobs supported within developments providing health, education, community, and other services in underserved communities.
The CDFI Fund reports that more than 75 percent of transactions financed by NMTC nationwide were located in a census tract with a poverty rate of at least 30 percent, a median family income at or below 60 percent of the applicable area median income, and an unemployment rate of at least 1.5 times the national average.
Public-private partnerships are essential to the success of the NMTC program. According to the CDFI Fund, for every $1 in federal investment, $8 in private-sector investment is leveraged. The CGR Fund leverages the community partnerships established with CHFA’s commercial and infrastructure lending programs to accomplish its mission of investing in Low-Income Communities (LICs) with maximum impact.