Bipartisan Legislation Would Permanently Extend the New Markets Tax Credit
Yesterday bipartisan legislation was introduced in both the House and the Senate to permanently extend the New Markets Tax Credit (NMTC), a critical tool for attracting private investment capital to some of the most distressed urban, suburban and rural communities. Senators Roy Blunt (R-Mo.) and Ben Cardin (D-Md.) introduced the Senate legislation (S. 384), and were joined by Senators Chuck Schumer (D-N.Y.) and Kirsten Gillibrand (D-N.Y.) as original co-sponsors. Representatives Pat Tiberi (R-Ohio-12) and Richard Neal (D-Mass.-1) introduced the House legislation (H.R. 1098), which has 20 additional original co-sponsors. Enterprise strongly supports this bipartisan effort, which is especially important as Congress considers comprehensive tax reform.
Since the NMTC was created in 2000, it has been extended numerous times. Most recently, legislation passed in December of 2015 extended program authority for five years. However, without Congressional action, the NMTC will expire in 2019. In order to provide stability and certainty to this critical community development tool for low-income communities, the NMTC must be extended permanently. Earlier this month Enterprise joined roughly 2,000 organizations in signing onto a letter urging Congress to expand and extend the NMTC, which highlights the program’s role in stimulating investment and economic growth in communities that lack access to the patient capital needed to support and grow businesses, create jobs, and improve local economies. In addition to making the NMTC a permanent part of the tax code, the new legislation would index the allocation of the credit for inflation and provide alternative minimum tax relief.
Between 2003 and 2014, the NMTC generated over $75 billion in capital investment and created over 750,000 jobs in communities with high poverty rates, low incomes and high unemployment rates. Enterprise has used the NMTC to invest $824 million in distressed communities, creating over 16,000 jobs. Read more about the impact of the NMTC.
"The New Markets Tax Credit Program has a proven track record of spurring investment, expanding opportunity, and improving the quality of life in communities that need it most,” Senator Blunt said in a statement. “The NMTC provides a critical incentive for drawing much-needed capital to low-income rural and urban areas, and I look forward to working with my colleagues to ensure it continues.”
Senator Cardin added, “In Maryland, the New Markets Tax Credit has been deployed across our state on a diverse range of infrastructure and community development efforts, from a supermarket project to provide greater access to healthy food in my home city of Baltimore, to a conservation center on the Eastern Shore.
“The NMTC has spurred investment and driven real job growth across the state of Ohio,” Rep. Tiberi said in a statement. “Making the NMTC a permanent part of our tax code would provide more certainty to communities across the country looking for the same proven results of unlocking economic potential based on their needs.”
“Since its enactment in 2000, the NMTC has created thousands of jobs and generated billions of dollars of investment in low income communities across the country," said Rep. Neal. "That is why I’m working with Congressman Tiberi in a bipartisan manner to make it a permanent part of the tax code. The NMTC is a federal program with a proven record of success that should be made permanent and expanded."