Treasury's New Markets Tax Credit Program Named One of Top 25 in Innovations in American Government Awards Competition

Washington, DC  The U.S. Department of the Treasury's New Markets Tax Credit Program (NMTC Program) has been named today as one of the Top 25 programs that will advance to the final stages of competition for the prestigious Innovations in American Government Award. The NMTC Program is among the top five percent of the programs competing, chosen from a pool of over 500 applications representing all levels of government across the nation that applied for this award. From this distinguished group, five finalists and one winner will be announced in the fall.

The Innovations in American Government Award is a significant force in recognizing and promoting the creative problem solving of local, state and federal governments and provides concrete evidence that government can work to improve the quality of life for citizens. By highlighting exemplary models of governments' innovative performance, the award serves as a catalyst for continued progress in addressing the nation's most pressing public concerns. The Innovations in American Government Award Program is administered by the Ash Institute for Democratic Governance and Innovation at Harvard University's John F. Kennedy School of Government and was created with funding from the Ford Foundation.

"I am very proud and excited to learn that the New Markets Tax Credit Program has been selected as one of the Top 25 programs in the Innovations in American Government Award Program competition," said Donna J. Gambrell, Director of the U.S. Department of the Treasury's Community Development Financial Institutions Fund (CDFI Fund), which administers the NMTC Program. "To be recognized among the top five percent of programs competing in this prestigious award is a testament to the NMTC Program achieving its goal of attracting critically needed private capital into our nation's low-income communities through innovative program design and implementation."

The NMTC Program provides tax incentives to induce private sector, market-driven investments in businesses and real estate developments located in economically distressed communities across the nation. From manufacturing plants in Iowa to health care centers on the Gulf Coast, the NMTC Program is attracting critically needed private capital investment to hard-to-finance projects in the nation's low-income communities. Its recognition by the Innovations in American Government Award Program today is particularly important, given the growing recognition that the economic crisis hit low-income families and communities harder than others and that their recovery is lagging behind that of the country.

About the New Markets Tax Credit Program

The NMTC Program, established by Congress in December of 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 (CDEs). The credit provided to the investor totals 39 percent of the cost of the investment and is claimed over a seven-year period. Substantially all of the taxpayer's investment must in turn be used by the CDE to make qualified investments in low-income communities. Successful applicants are selected only after a competitive application and rigorous review process that is administered by the CDFI Fund.

Through calendar year 2010, the CDFI Fund made 594 awards totaling $29.5 billion in tax credit allocation authority. The CDFI Fund anticipates announcing the availability of another $3.5 billion of allocation authority to CDEs later this spring. The NMTC Program is currently set to expire in 2011, but the Administration has asked Congress to extend the Program with a $5 billion authorization for 2012.

About the Community Development Financial Institutions Fund
The CDFI Fund was created for the purpose of promoting economic and community development through investment in and assistance to Community Development Financial Institutions (CDFIs). The CDFI Fund's role in promoting community and economic development was expanded in FY 2001 when the Secretary of the Treasury delegated to the CDFI Fund the responsibility of administering the NMTC Program.

Since its creation in 1994, the CDFI Fund has awarded $1.3 billion to CDFIs, community development organizations and financial institutions through the Community Development Financial Institutions Program, the Bank Enterprise Award Program, and its Native Initiatives. In addition, the CDFI Fund has allocated $29.5 billion in tax credit authority to CDEs through the NMTC Program.

About the Ash Institute for Democratic Governance and Innovation The Roy and Lila Ash Institute for Democratic Governance and Innovation advances excellence in governance and strengthens democratic institutions worldwide. Through its research, publications, leadership training, global network, and awards program developed in collaboration with a diverse, engaged community of scholars and practitioners - the Ash Institute fosters creative and effective government problem-solving and serves as a catalyst for addressing many of the most pressing needs of the world's citizens. The Ford Foundation is a founding donor of the Institute. Additional information about the Ash Institute is available at www.ashinstitute.harvard.edu. Applicants for the 2009 Innovations in American Government Awards are encouraged to apply at www.innovationsaward.harvard.edu.