The federal CDFI Fund recently announced a new round of New Markets Tax Credit allocations, including a $50 million award to LISC to fuel economic development, health and jobs. "New Markets Tax Credits help us fill capital gaps for women- and minority-owned businesses, rural communities and communities of color that are working to overcome long histories of discrimination,” noted LISC President and CEO Maurice A. Jones.
LISC will tap $50M NMTC allocation to help narrow gaps in heath and wealth affecting millions of Americans
Investments will focus on economic development, health and jobs in underserved urban and rural communities
NEW YORK (July 24, 2020)—The Local Initiatives Support Corporation (LISC) will use a new $50 million allocation of federal New Markets Tax Credits to promote quality jobs, better health, and local economic growth—especially in communities where a long history of racial discrimination has constrained opportunities.
The U.S. Department of Treasury’s CDFI Fund recently announced more than $3.5 billion in NMTC awards to 76 organizations, including LISC. Since the program was enacted in 2000, NMTC Program awards have generated $8 of private investment for every $1 invested by the federal government.
The latest round award brings LISC’s total allocation to more than $1.1 billion—the largest in the NMTC program’s history. The financing has supported new community health centers, manufacturing facilities, arts and entertainment businesses, office buildings, retail, schools, social services centers and even a children’s museum. All of these projects create community assets and job opportunities in neighborhoods that have experienced widespread disinvestment and high rates of unemployment.
“New Markets Tax Credits help us fill capital gaps for women- and minority-owned businesses, rural communities and communities of color that are working to overcome long histories of discrimination,” said Maurice A. Jones, LISC president and CEO. “This is particularly important now as we collaborate with local partners to address COVID-19 and narrow the disparities in health and wealth that affect millions of American families,” he added.
NMTCs support projects like MLK Gateway, a $21.7 million tech-driven economic development project in Washington, D.C.’s Anacostia community. Led by a partnership between The Menkiti Group, a prominent local developer, and Enlightened, Inc., an IT and management consulting firm, MLK Gateway is revitalizing four aging storefront buildings into space for 150 Enlightened employees, as well as retail and additional office space.
The project tapped $8 million of NMTC investment authority from LISC, more than $2 million in additional LISC loans and equity investments, and nearly $3 million in Opportunity Zone capital to support it.
“These investments have a ripple effect that goes well beyond any one business or project,” noted Kevin Boes, president and CEO of New Markets Support Company (NMSC), a LISC affiliate that manages the organization’s New Markets work. “In places that the mainstream market does not directly serve, they help revitalize community assets, attract new businesses, expand employment and build local wealth.”
Boes said communities need a range of financial tools like NMTCs that are specifically designed to be inclusive and responsive to local concerns. “Often, we talk about programs like NMTC as if they existed in silos, when really they are part of a robust ecosystem of public and private efforts to support healthy communities,” Boes said. “It is critical, right now, to scale up these kinds of opportunities in light of COVID-19. Businesses and local nonprofits need access to grants and flexible financing so they can not only sustain their operations during the pandemic, but also plan for recovery and growth.”
Since the NMTC program was enacted in 2000, awards have generated $8 of private investment for every $1 invested by the federal government. Awardees have deployed more than $52.5 billion in capital for businesses and development activity in low-income communities and supported more than 836,000 jobs. For more visit the CDFI Fund’s NMTC data or www.cdfifund.gov.
About LISC
With residents and partners, LISC forges resilient and inclusive communities of opportunity across America – great places to live, work, visit, do business and raise families. Since 1979, LISC has invested $22 billion to build or rehab more than 419,000 affordable homes and apartments and develop 70.3 million square feet of retail, community and educational space.
About New Markets Support Company
New Markets Support Company (NMSC) is an affiliate of LISC launched in 2003 to manage its New Markets Tax Credit efforts. NMSC partners with LISC program offices and the national Rural LISC program to utilize LISC’s NMTC award, building community assets such as healthcare centers, schools and businesses that provide quality jobs in underinvested communities. NMSC has expanded its scope of services to partner with other financial organizations to boost their impact capacity and mobilize investor capital in underserved markets throughout the country. For more information, visit www.newmarkets.org.