On February 25, Representatives Terri Sewell (D-AL) and Tom Reed (R-NY), as well as Senators Ben Cardin (D-MD) and Roy Blunt (R-MO), introduced the New Markets Tax Credit (NMTC) Extension Act of 2021 (H.R. 1321/S. 456). The legislation would make the New Markets Tax Credit (NMTC) permanent at $5 billion in credit allocation a year and provide an exception from the Alternative Minimum Tax (AMT) for NMTC investments. The bill currently has 23 cosponsors in the House.
“The COVID-19 pandemic has laid bare the historic disinvestments in our rural and underserved communities. Now more than ever, it is critically important that our communities have permanent access to the New Market Tax Credit as a tool to facilitate investments in local businesses and community development projects as we recover from our economic crisis,” said Rep. Terri Sewell in a press release. “The NMTC remains crucial to the creation of job growth and opportunity in Alabama’s 7th Congressional District, and I’m proud to introduce this bipartisan bill to ensure our most underserved communities are not left behind.”
Since its authorization, more than $55 billion in direct NMTC investment has created well over a million jobs. These NMTC investments leveraged nearly $110 billion in capital from other sources for businesses, healthcare centers, manufacturing expansions, and revitalization projects in communities with high poverty and unemployment rates. Historic rehabilitation tax credits (HTCs) are often used in conjunction with NMTCs and are a critical source of financing for many historic rehabilitation projects.