The 2021 Expansion of New Market Tax Credits
The New Market Tax Credit (NMTC) Program was first established in 2000 to stimulate investment and economic growth in lower-income urban neighborhoods and needy rural communities. Since then, the NMTC Program has worked with more than 6,500 projects and allocated over $105 billion for qualified development projects. The program has also created more than one million jobs around the country, in all 50 states, as well as the District of Columbia and Puerto Rico.
At the end of last year, Community Development Entities (CDEs), business advisors, and attorneys who focus on this area of economic improvement, including our team here at Savage Associates, were keeping a sharp eye on the future of the NMTC program. Since the original program term was set at 20 years, the NMTC Program was slated to expire on December 31, 2020.
The Future of the NMTC Program
After enjoying a solid 20 years of bipartisan support and experiencing overwhelming success in our communities, the federal government agreed to extend the program for another five years. The program also received funding in the amount of $5 billion per year for a total of $25 billion in new funds to keep the progress going.
Without this five-year extension, some prior projects might stumble and future dreams could be jeopardized. As a result of the new funding, the NMTC is expected to produce:
- 690 new industrial projects and manufacturing opportunities
- 255 upgraded or brand new medical facilities such as clinics and hospitals in some of the neediest communities
- 275 projects combining housing and social services with commercial spaces
- 775 community facilities, Boys and Girls Clubs, daycares, and other child-related projects
- 590,000 new jobs in the community and economic development arena.
The 2020 extension was the largest in the NMTC Program’s history which means our clients can apply for more money and deliver much-needed resources to lower-income communities. This growth will in turn create employment, promote economic opportunities, and generally improve the lives of more Americans in the next five years.
We’re Here To Guide You Through The Process
The team at Savage Associates recognizes how impactful the NMTC extension will be to continue important development projects in urban and rural communities. We are passionate about serving our clients and providing valuable benefits to the communities we will improve together.
If you have any questions about the NMTC program or other development matters, give us a call at 215.880.9441 in Philadelphia, or at 202.817.3941 for our Washington D.C. office. Or visit us at Savage Associates anytime for more information or to set up a consultation. Let’s improve our communities together!