The U.S. Treasury Department has awarded Vermont Rural Ventures, a subsidiary of Housing Vermont, $35 million in New Markets Tax Credits (NMTC). Housing Vermont was one of 87 organizations nationally to share in $3.5 billion in the current round of awards which will be the last awards unless Congress votes to extend the program. Awards ranged from $15 million to $60 million.
“Our NMTC program has already financed nine community development projects including new state office buildings in Barre and St. Albans, the expansion of the Commonwealth Dairy in Brattleboro and Weidmann Technology in St. Johnsbury, as well as a new Rutland campus for Vermont Community College,” said Housing Vermont President Nancy Owens. “This award will allow us to respond to a strong pipeline of community projects.”
This is the fourth award to Housing Vermont’s NMTC program which is operated by Vermont Rural Ventures, a wholly owned subsidiary. The announcement brings the organization’s total NMTC awards to $140 million.
The NMTC Program, established by Congress in December 2000, permits individual and corporate taxpayers to receive a credit against federal income taxes for making qualified equity investments in investment vehicles known as “Community Development Entities.” The credit provided to the investor totals 39 percent of the cost of the investment and is claimed over a seven-year period. A majority of the taxpayers’ investments must in turn be used by the CDE to make qualified investments in low-income communities.
“The New Markets Tax Credit Program creates jobs and critical investments in low-income neighborhoods and rural communities across the nation,” said Amias Gerety, Acting Assistant Secretary for Financial Institutions. “Often the New Markets Tax Credit is the most critical piece of the puzzle when trying to finance important economic development projects across the country. Its ability to attract private-sector capital into some of the most economically distressed and underserved communities is a hallmark of this important economic development program.”
CDEs must apply annually to Treasury to compete for New Markets Tax Credit Program allocation authority. The 87 organizations receiving awards were selected from a pool of 310 applicants that requested over $25.9 billion in allocation authority. They are headquartered in 32 different states and the District of Columbia, and they have identified principal service areas that will cover nearly every state in the country and the District of Columbia.
“Our housing development activities helped us to appreciate the connections between affordable housing and economic development,” Nancy said. “We look forward to building on that experience to advance more community and commercial projects.”