$3.5 billion in New Market Tax Credits announced — and over 70% of recipients want to finance healthy food enterprise!

by Nessa on June 7, 2014

Yesterday’s announcement of $3.5 billion in New Market Tax Credit (NMTC) allocations contained a surprise that should give local food systems advocates a big smile. According to the CDFI Fund’s report, which accompanied the announcement, “While there was no specific set-aside of tax credits for healthy food financing in the 2013 NMTC allocation round, applicants were asked to indicate if they intend to devote a percentage of their allocation to Healthy Food Financing activities. 61 of the 87 allocatees (or 70.1 percent) indicated that they intend to devote some portion of their NMTC allocation to Healthy Food Financing activities.”

That right there is an amazing statistic.

Although not all states have CDFIs that received a NMTC allocation, all can still potentially access NMTC through CDFIs with national programs. If you want to find out who has new allocations, you can see the whole list in the Program Award book below. 

http://cdfifund.gov/news_events/CDFI-2014-19-Treasury_Announces_3.5_Billion_NMTC_Awards.asp

http://cdfifund.gov/docs/nmtc/2013/2013_NMTC_Program_Award_Book_06052014.pdf

 If you are not familiar with the NMTC program, you can read more about it here:

http://cdfifund.gov/docs/nmtc/2013/Application%20Materials/Introduction%20to%20NMTC%20Final%20for%20Publication.pdf It is a complex program good for large ($10m+) projects. One bottom line: it often provides a percentage of convertible debt to the borrower.

In addition to this burgeoning interest in food system finance on the part of the NMTC recipients, there is growing/new interest on the part of many state, county and municipal development finance agencies. I just completed a WebCourse this week with 55 of these public agencies through the Council of Development Finance Agencies (CDFA). States, counties, towns and cities from all across America attended, and they were very interested in food system finance all across the marketing chain, especially hubs and shared-use commercial kitchens.   

http://www.cdfa.net/cdfa/cdfaweb.nsf/0/FEDFF21EDCBBCBAF88257C63005164F3

To me this seems like an opportune time to bring the food systems folks interested in large capital intensive projects like food hubs and processing centers together in the room with NMTC recipients (CDFI/CDEs) interested in healthy food finance and the public (state/county/local) development finance agencies who have shown an interest to talk about opportunities for moving things to the next level. 

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