Monday, March 10, 2014
NEW MARKETS TAX CREDITS: A UNIQUE OPPORTUNITY FOR ALABAMA BUSINESSES AND ECONOMIC DEVELOPMENT
Alabama finds itself in the bottom 10 of a recent ranking of U.S. states, and this low ranking is good news for Alabama businesses and economic development professionals in the state. In 2012, the Community Development Financial Institutions Fund (or CDFI Fund), an arm of the U.S. Department of the Treasury that oversees the federal New Markets Tax Credit (or NMTC) program, identified Alabama and 9 other U.S. states as being historically underserved by the NMTC program. On a related note, in 2012, the Alabama Legislature passed legislation that created a parallel State of Alabama NMTC program, which the Alabama Department of Commerce oversees.
At the end of February, the CDFI Fund announced that it anticipates making $3.5 billion in federal allocation awards for its 2013 calendar year application round in May 2014. This announcement was followed by the release of President Obama’s FY 2015 Budget, which proposes a permanent extension of the federal NMTC program with $5 billion in annual allocation authority. No legislation has been introduced to date that would authorize additional allocation authority under the Alabama NMTC program.
The twin trends of Alabama’s designation as a state historically underserved by the federal NMTC program and Alabama’s passage of legislation creating a state NMTC program present a unique opportunity for Alabama businesses and economic development professionals in the state over the next few months.
To read more about the opportunities available for Alabama businesses under the federal and state NMTC programs, please click here. To read more about the opportunities available for Alabama banks under the federal and state NMTC programs, please click here.
For more information about Maynard Cooper & Gale’s New Markets Tax Credit capabilities, please contact one of our lawyers listed below or please click here.