Latest news with #NewMarketsTaxCredit
Yahoo
14-05-2025
- Business
- Yahoo
Why Maryland needs a state new markets tax credit program
With a shaky economy and uncertainty at the federal level, Tom Coale and Ryan Dressler argue that now is the time for the state to invest in a state-level New Markets Tax Credit program. (Photo by Angela Breck/Maryland Matters) Maryland is a state with great economic opportunity, but it is not equally distributed. From Baltimore's disinvested neighborhoods to Western Maryland's struggling small towns and the Eastern Shore's underdeveloped commercial corridors, too many communities lack the resources and capital needed for sustainable economic growth. In the context of fiscal headwinds and uncertainty with the federal workforce, now is the time for the state to invest in a state-level New Markets Tax Credit (NMTC) program, modeled after the federal program. A $5 million annual investment each year for four years in the form of a tax credit (foregone tax revenue) — for a modest total of $20 million—would leverage significantly more private capital, spur job creation and provide a path forward for economic sustainability that is not dependent on federal spending. The federal NMTC program was created in the year 2000 to encourage tens of billions of dollars of private investment in low-income communities. It provides tax credits to investors who fund projects in economically distressed areas, such as business expansions, mixed-use developments and community facilities. The program has a proven track record of attracting private investment, creating jobs and revitalizing neighborhoods, and is often the source of the first dollars invested in a redevelopment area. Maryland Matters welcomes guest commentary submissions at editor@ We suggest a 750-word limit and reserve the right to edit or reject submissions. We do not accept columns that are endorsements of candidates, and no longer accept submissions from elected officials or political candidates. Opinion pieces must be signed by at least one individual using their real name. We do not accept columns signed by an organization. Commentary writers must include a short bio and a photo for their bylines. Views of writers are their own. From 2003-2023, the federal NMTC financed 115 projects in Maryland, creating 15,200 permanent full-time equivalent jobs. But even with this notable impact, Maryland is far behind its peers in utilizing the program. Through fiscal 2023, Maryland was ranked 19th among the states in NMTC allocation invested in projects located within the state at $1.3 billion, far below neighboring Pennsylvania, ranked ninth at $2.6 billion. Since 2007, 14 other states—including Ohio, Louisiana, Florida, Maine, Missouri, Illinois, and Nevada—have successfully implemented and renewed state NMTC programs. The federal program will award one of the largest amounts in program history in late 2025 – a full $10 billion of investment – but Maryland will need to develop a track record of success to compete. Leveraging Private Investment: One of the most compelling reasons for Maryland to adopt a state NMTC program is its ability to attract private capital. Historically, every $1 of NMTC allocation generates $8 in private investment. This means that Maryland's $5 million annual investment would yield $40 million of immediate program investment and encourage over $160 million of total private investment over the life of the program. Revitalizing Maryland's Most Distressed Communities: Many of Maryland's struggling communities lack the infrastructure and commercial activity needed to drive economic growth. A state NMTC program would target investments in areas with high poverty rates, low median incomes and high unemployment, ensuring that resources reach those who need them most. Baltimore City has numerous neighborhoods that would benefit from an infusion of investment to support small businesses, workforce development centers and community spaces. Western Maryland, which has struggled with the decline of manufacturing and coal, could use NMTCs to fund tech hubs, tourism-related businesses and health care facilities. The Eastern Shore, where agriculture and seafood industries remain dominant but undercapitalized, could see expanded processing facilities, cold storage infrastructure and commercial hubs. These investments would not only stimulate business activity but also create jobs, improve property values, and enhance community services. Job Creation and Workforce Development: The NMTC program has a strong track record of job creation. Projects funded by NMTCs often lead to construction jobs in the short term and permanent jobs in retail, manufacturing and services. For example, an investment in a new grocery store in a food desert would create construction jobs during development, retail jobs upon opening and supply chain jobs for distributors. A state-of-the-art vocational training center could train workers for high-demand industries such as health care, cybersecurity and clean energy, helping Marylanders gain skills and secure higher-paying jobs. A Maryland NMTC could also be structured to small startups, and projects with strong community benefits, ensuring that economic growth is both inclusive and equitable. Maryland has a choice: Continue relying solely on federal programs and risk losing out on critical investments, or take proactive steps to spur economic revitalization through a state New Markets Tax Credit program. Time is of the essence to position Maryland to fully participate in the large allocation of federal New Markets Tax Credit spending later this year. Maryland has long been a state of innovation and economic opportunity. A state NMTC program would reaffirm that commitment, ensuring that every community — urban, rural, and suburban — has the resources it needs to thrive.
Associated Press
15-04-2025
- Business
- Associated Press
RDP/MagPro Partnership Brings Production and Jobs to America
FOREST CITY, Iowa, April 15, 2025 /PRNewswire/ -- Rural Development Partners (RDP) awarded $17.5 million in New Markets Tax Credit (NMTC) financing to MagPro, LLC, a Nonferrous Metal Production and Processing corporation located in Camden, Tennessee. Funding will enable the purchase of parts necessary to construct 5-7 vacuum furnaces, driving expansion and growth for the company while creating an additional 150 quality jobs in rural Benton County. RDP allocation is the second in a two-phase business plan utilizing NMTCs, the first enabling MagPro to increase production by nearly 100% while creating over 50 new jobs. Employees receive specialized in-house training and workforce development opportunities unique to the industry, presenting a great opportunity for rural workers to economically further their skillsets. Benton County Mayor Mark Ward stated, 'The expansion will significantly benefit our local and nearby rural communities. MagPro's understanding of the value of meaningful contributions has made it an integral part of our economic development efforts, and we greatly appreciate their continued partnership and support.' The United States magnesium industry consumed $4.35 billion worth of magnesium in 2021, $4.58 billion in 2022, and is projected to reach $7.6 billion in sales by 2032. MagPro is building its cash reserves so it can undertake substantial increases in the purchasing of raw materials and inventory. There is, effectively, an unlimited amount of raw material available, but shortfall of those who can manufacture and recycle magnesium the way MagPro can. The company's immediate goal is to promote their current product line while extending its portfolio of products and services. Magnesium is primarily used in the aluminum and steel industries, also by die casters who make parts for the aerospace, automotive and medical industries, the military, and so much more. MagPro's business plan projects a 25% increase in the purchase of inventory and raw materials, resulting in a 40-50% increase in sales volume over the next five years. Their ultimate goal within the next 10 years is to become the largest primary magnesium producer in the United States, bringing jobs to America and substantially decreasing U.S. industry dependence on imports. 'RDP is proud to partner with MagPro on this very impactful project to enable them to strengthen their efforts in providing high-quality jobs in Camden and the surrounding area. China is currently the world leader in magnesium manufacturing and MagPro's expansion will greatly help reduce the USA's industry reliance on them.' – Dan Helgeson, CEO of Rural Development Partners MagPro MagPro LLC was founded in 2003 and is one of the world's largest magnesium recyclers, and second largest producer of Primary Magnesium in the United States. MagPro is the only magnesium manufacturer in the world that recycles low grade magnesium scraps, offering a number of tolling conversion programs for specification as well as specialty alloys tailored to meet individual customer needs. Rural Development Partners LLC Rural Development Partners is a Community Development Entity with a national service area eligible to apply for an annual allocation of Federal New Markets Tax Credits. From 2004 through 2024, RDP has won thirteen NMTC awards from the US Treasury totaling $816.7 million. Funding has helped over 50 businesses and nonprofits expand to provide quality jobs, economic impacts, and healthy food access in underserved communities. RDP seeks to serve and partner with businesses, non-profits, communities, and government entities that share its mission to build public-private partnerships for catalytic job growth in rural America. Learn more about RDP and the NMTC program by visiting our website or social media platforms at Facebook, LinkedIn, and YouTube. Media Contact: Rural Development Partners [email protected] View original content to download multimedia: SOURCE Rural Development Partners
Yahoo
21-03-2025
- Business
- Yahoo
Future Of CDFI Fund And MBDA, Uncertain With Their Planned Ouster
The Community Development Financial Institutions Fund (CDFI Fund) has invested over $8 billion through various monetary award programs, helping underserved people and communities. The Minority Business Development Agency (MBDA) helped wrap up $3.8 billion in contracts for minority businesses in 2023. That drive is significant as it can help those firms, including Black-owned businesses, to scale up and potentially fuel revenue growth. However, the downside now is the CDFI Fund and MBDA — deep-rooted and bipartisan supporters of Black entrepreneurs and individuals, among others — are being cut by President Donald Trump. They are among seven agencies proposed for elimination as part of a new executive order that continues Trump's actions to cut federal government spending. The CDFI Fund supplies financial backing to Community Development Financial Institutions (CDFIs) via grants, bond guarantees, and tax credits. CDIFs were created to spur community development in local communities. Their work includes funding affordable housing and small minority-owned businesses. They provide loans and other financial products in underserved communities, often with lower fees than rivals like mainstream banks and payday lenders. The CDFI Fund 'plays an important role in generating economic growth and opportunity in some of our nation's most distressed communities,' per its website. The order commands the fund to trim personnel and operations. Started in 1994, the CDFI Fund is part of the U.S. Treasury Department. Industrywide, CDFIs had roughly $452 billion in assets as of the first quarter of 2023. That consisted of $300B for credit unions, $118B for banks, and $35B for loan funds, according to the Federal Reserve Bank of New York. According to its 2024 annual report, the 'CDFI Fund award recipients successfully leverage billions in private sector investment to create jobs, build affordable housing, build essential community facilities, and provide financial counseling.' That includes investing in 'distressed and underserved communities lacking access to traditional lending or banking institutions.' The report also stated that $81 billion has been supplied through the fund's New Markets Tax Credit program. The CDFI Fund declared that since its start, it has helped build the capacity of 1,400 Certified CDFIs in all 50 states along with the District of Columbia, Guam, and Puerto Rico. Trump's order occurred the same day he signed a continuing resolution into law that calls for $324 million in funding for the CDFI Fund for fiscal 2025. It's unknown if prior approved grants will be paid for financial institutions now utilizing CDFI Fund grants. In an email to BLACK ENTERPRISE, U.S. Treasury Secretary Scott Bessent stated, 'This Administration recognizes the important role that the CDFI Fund and CDFIs play in expanding access to capital and providing technical assistance to communities across the United States. CDFIs are a key component of President Trump's commitment to supporting Main Street America in the pursuit of job growth, wealth creation, and prosperity.' He added, 'As required by President Trump's March 14, 2025, Executive Order, the Treasury Department will provide a response to the Director of the OMB on this matter and looks forward to future engagement with CDFIs and other stakeholders to strengthen the impact of these statutory programs and incentivize economic opportunities for all Americans.' As for the MBDA, Trump's latest dictate marks the second time since 2017 he has tried to erase the agency catering to minority firms for over 50 years. The MBDA's efforts have included providing access to capital, contracts, and market opportunities as part of the U.S. Department of Commerce. Two years ago, the agency also brought access to $1.5 billion in capital to empower minority businesses and helped them generate or protect over 19,000 jobs, according to its website. Efforts to get a comment from the MBDA were unsuccessful. William Michael Cunningham, an economist and founder of Creative Investment Research, told BLACK ENTERPRISE by email that his firm has long recognized the CDFI Fund's significant role in strengthening Black economic empowerment. For a decade (2013 through 2023), Cunningham estimates that at least $219 million from the CDFI Fund has supported Black-owned banks and businesses through targeted programs. Specifically, he says around $31 million has benefited Black-owned banks via the fund's Bank Enterprise Award program, directly enhancing their capacity to serve communities often overlooked by mainstream financial institutions. Further, Cunnigham mentioned about $188 million has flowed to Black-led Community Development Financial Institutions, fueling lending and investment in Black-owned businesses nationwide. He stated notable recipients include institutions like Hope Credit Union, TruFund Financial Services, and Community First Fund, whose critical efforts drive economic justice, equity, and opportunity in underserved Black communities. 'Ongoing disparities underscore the need for significantly increased funding and new, innovative support mechanisms.' Cunningham shared that the potential reduction in support from the CDIF Fund and MBDA poses significant risks to minority businesses. He says it could lead to reduced access to capital and funding shortages, severely limiting the businesses' growth and sustainability. He expressed that the scarcity of business development support, including strategic guidance and capacity building, could impact competitiveness. Another potential snag: The loss of networking and market access facilitated by these agencies could negatively impact revenue generation. The Small Business Majority advocacy group criticized Trump's latest order. The group's research showed that the institutions play a large role in benefiting women BIPOC-owned small businesses. Some 24% of respondents polled last year declared that a government program geared to help a specific demographic group prevented their business from closing, and 14% stated a demographically targeted program helped them gain contracts. Of small businesses that got publicly funded support, roughly 25% had help from MBDA. In a statement, Small Business Majority Founder and CEO John Arensmeyer touched on the impact of shattering the CDIF Fund and MBDA. Among his comments, he noted that between 2021 and 2024, there were 21 million new business applications. But he added that these fledgling small businesses cannot succeed or survive without support. 'President Trump may well succeed in undermining our smallest and most under-resourced businesses, but in doing so, our economy and our communities will be devastated. Instead of searching for ways to cut small business programs no matter their size or purpose, President Trump should be looking for ways to boost entrepreneurship.' RELATED CONTENT:
