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NMTC Coalition’s 2023 Annual Meeting – FORVIS’ Takeaways

Four key takeaways from the New Markets Tax Credit Coalition’s Annual Conference in December 2023.
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At the end of 2023, the New Markets Tax Credit (NMTC) team from FORVIS spent two days in Washington, D.C. attending the New Markets Tax Credit Coalition’s (the Coalition) Annual Conference. The Coalition is a national membership organization founded in 1998 to advocate on behalf of the NMTC Program.1

The NMTC Program, overseen by the Community Development Financial Institutions (CDFI) Fund, a division within the Treasury Department, attracts private capital into low-income communities by permitting individual and corporate investors to receive a tax credit against their federal income tax in exchange for making equity investments in specialized financial intermediaries called Community Development Entities (CDE). The credit totals 39% of the original investment amount and is claimed over a period of seven years. Low-income communities often experience a lack of investment, as evidenced by vacant commercial properties, outdated manufacturing facilities, and inadequate access to education and healthcare services. The NMTC Program aims to break this cycle of disinvestment by attracting the private investment necessary to reinvigorate struggling local economies.2

Over the two days, various NMTC Program stakeholders provided updates on current initiatives and legislative changes impacting the NMTC Program today. There were four key topics of discussion we would like to highlight for organizations who are considering NMTC financing or are curious about the current status.

  1. The recent updates to regulations surrounding the Community Reinvestment Act (CRA) received a significant amount of airtime. The CRA, which Congress initially enacted in 1977 to address systemic inequities in access to credit, encourages federally insured banks to help meet the credit needs of communities in which they do business, especially low- and moderate-income (LMI) communities. On October 24, 2023, the Office of the Comptroller of the Currency, the Federal Reserve Board, and the FDIC issued a final rule to strengthen regulations of the CRA, with the goal of modernization and update for recent changes in the banking industry. Among numerous other complex changes (the new rule totals nearly 1,500 pages), banks subject to compliance under the new CRA regulations will now be evaluated on the basis of additional impact and review factors that include specific reference to the NMTC Program. The new evaluation framework specifically recognizes the impact and responsiveness of investments in rural communities. Because of these new regulations, banks that previously may have been hesitant to invest in an NMTC project outside its typical geographic area may do so without impacting CRA compliance.
  2. Another piece of legislation expected to have downstream impacts on the NMTC Program includes the recently enacted Inflation Reduction Act (IRA), which was signed into law by President Biden in August 2022. The IRA includes new and revised tax incentives for clean energy projects. One major component of the IRA highlighted includes the creation of the Greenhouse Gas Reduction Fund, which is a $27B investment to stimulate financing and allocate capital to address the climate crisis and deliver “lower energy costs and economic revitalization to communities that have historically been left behind,” akin to the NMTC Program. Organizations seeking financing for projects specifically aimed at achieving similar goals of addressing climate change may be able to ‘bundle’ incentives by utilizing both funding from the Greenhouse Gas Reduction Fund and the NMTC Program. The significant federal dollars flowing into this economic sector demonstrates the federal government’s heightened focus on combating climate change and bodes well for organizations looking to finance projects in this space.
  3. We also heard from a panel of CDFI Fund representatives, who shared their insights about the future of the NMTC program. In 2020, Congress extended the NMTC from 2021 to 2025 at $5B in annual allocation authority. Credits authorized by the CDFI Fund in 2021 and 2022 have already been awarded, and the 2023 awards are expected to be made in the fall of 2024. The CDFI Fund panel shared its intention to allocate funding in the timeframe under the 2020 extension. Many industry stakeholders speculate this may mean a “double award” round or some other “catch-up” mechanism that could total $10B, which would open in January 2025 and make awards by the end of the year. Given the program has strong bipartisan support and a history of proven community development success, many believe this initiative will be successful. If your organization is considering a project in the next couple of years that could benefit from NMTC program financing, this is an important initiative to monitor, as a $10B allocation in 2025 could significantly increase the odds of receiving such financing.
  4. Finally, another recent initiative of the Coalition has been support of an add-on allocation for investments benefiting tribal communities. The Coalition is proposing a $175M add-on allocation for investments in tribal statistical areas and investments outside of those areas in support of native people; the proposal was included in the Build Back Better Act which passed in 2021. Various other legislative bills supporting the initiative have been introduced by both parties in recent years, highlighting the bipartisan efforts to grow and expand the program’s reach into NMTC Native Areas. The CDFI Fund has similarly demonstrated its commitment to this effort via the NMTC Native Initiative,3 which has a goal of increasing investments in Federal Indian Reservations, Off-Reservation Trust Lands, Hawaiian Home Lands, and Alaska Native Village Statistical Areas, collectively referred to as NMTC Native Areas. In 2022, the CDFI Fund selected a contractor, Big Water Consulting, to assist with this effort. One of the outputs of the work conducted by Big Water Consulting was the creation of a Self-Assessment Guide for Native Organizations. If you believe your organization may be able to benefit from NMTC financing under this initiative, check out the assessment tool here: Self-Assessment Guide for Native Organizations (

The NMTC Program can be difficult to navigate on your own. FORVIS created TaxCred PRO™ for NMTC to help improve speed, increase accuracy, and drive value through the NMTC transaction process. For more information, please see our NMTC webpage or reach out to a FORVIS advisor today.

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