Connected Big Boys Access A Bottomless Pit Of Tax Credits

There's a bill parked in the House Ways & Means Committee called the New Markets Tax Credit (NMTC) Extension Act for 2015. Over at the Senate Chamber, a companion piece awaits introduction. The president likes NMTC; his budget and the legislation both call for NMTC to be made permanent. As is, it has been re-upped every two years since 2007.

NMTC, at its core, enriches rich folks. Even as the latest extension legislation snoozes in Ways and Means, connected opportunists are pursuing NMTC like lions stalk Springbok.

The program was called the Community Renewal Tax Relief Act when President Clinton signed it December 21, 2000. It was sort of a Clintonian Yellow Brick Road. Its purpose was to inject the spirit of economic development into communities that were statistically impoverished at the 25% level.

That’s supposedly still its purpose. A website called ‘Enterprise’ accurately defines NMTC’s logistics. NMTC is administered by the Treasury Department. Treasury’s Community Development Financial Institutions Fund (CDFI) awards allocation authority to Community Development Entities (CDEs). CDE’s, in turn, use the qualifying loan or equity investment in a project or business called a Qualified Active LOW-INCOME Community Business.

But the devil is in the details. ...

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