Rep. Peters and Don Graves Highlight Success of the New Markets Tax Credit (NMTC) Program in Michigan

Peters, Graves, Community Leaders and Local Businesses Join at the Gateway Marketplace where the NMTC Program has Created Hundreds of Jobs and Revitalized a Once Severely Distressed Neighborhood

Detroit – Today, U.S. Representative Gary Peters highlighted the success of the New Market Tax Credit (NMTC) program by visiting the Gateway Marketplace in Detroit. The shopping center, located at the southeast corner of Woodward Ave and 8 Mile Road, was built utilizing New Market Tax Credit allocations from multiple Community Development Entities (CDEs) in Southeast Michigan. Peters was joined by Don Graves, the Executive Director of the President’s Council on Jobs and Competitiveness, business owners and local community leaders and residents.

Peters said, “As our economy continues to recover, we need to be making investments that create jobs, grow small businesses and strengthen our middle class. The New Market Tax Credit has made a real and positive impact on this community. As we look around today at this revitalized shopping center which has brought jobs, fresh food and economic development to this community, we are reminded that with smart policies and the right investments, Michigan’s economy can continue to grow.”

The Gateway Marketplace is located in what was a once severely distressed neighborhood, qualifying as a federally recognized food desert, and is now revitalized thanks in large part to the NMTC program which supported the construction project. The Gateway Marketplace features a Meijer Super Center as the anchor tenant, the first national grocery/retail store to open in Detroit in years bringing fresh food to the community, along with jobs and economic revitalization.

Don Graves said, “The Treasury Department’s CDFI Fund has used the New Market Tax Credit Program to make a tangible difference in communities across the country, and especially here in Detroit. These investments attract new business development and economic opportunities to where they are needed most, revitalizing our most underserved neighborhoods. It is a pleasure to be here in Detroit and to join Representative Peters, a champion of these smart investments, because we both are committed to seeing a resurgent Detroit, with a strong business sector, robust job creation and a growing middle class.”

Prior to the press conference, Peters hosted a roundtable discussion on the successes and future opportunities related to the New Markets Tax Credit (NMTC) program. The event brought together Community Development Entities (CDEs), developers, local business owners, lenders, community leaders, and other stakeholders for a discussion about how the NMTC program can spur economic growth and job creation in Michigan.

Background

New Market Tax Credit (NMTC) Program:The New Markets Tax Credit was enacted in 2000 in an effort to stimulate private investment and economic growth in low income urban neighborhoods and rural communities that lack access to the patient capital needed to support and grow businesses, create jobs and sustain healthy local economies. The NMTC is a 39% federal tax credit, taken over seven years, on investments made in economically distressed communities. Today due to the NMTC, more than $60 billion is hard at work in underserved communities in all 50 states, the District of Columbia and Puerto Rico.

NMTC in Michigan: Since the start of the program in 2000, NMTC Investments in Detroit have allocated $387 million for 26 projects. Statewide, there have been 169 projects with a total of $675.4 million in allocations with the majority of the allocations going to commercial real estate rehabilitation.

Rep. Peters Champions NMTC:Rep. Peters has been a strong advocate for the NMTC program since coming to Congress in 2009. Peters voted for the American Recovery and Reinvestment Act of 2009, which increased the NMTC allocation for 2008 and 2009 to $5 billion from $3.5 billion. In 2010, Peters voted for the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 that extended the NMTC authorization through 2011 at a $3.5 billion funding level. Peters voted for the American Taxpayer Relief Act of 2012, which extended the New Markets Tax Credit program for two years with $7 billion in allocations ($3.5 billion per year).  These awards are for calendar years 2012 and 2013. Applications for the 2013 tranche are currently being reviewed by the U.S. Treasury Department.

In addition, Peters has consistently supported programmatic appropriations requests for the Department of the Treasury’s Community Development Financial Institutions (CDFI) Fund. The CDFI Fund administers the NMTC program and other programs that expand the capacity of financial institutions to provide credit, capital, and financial services to underserved populations and communities around the country. In October of 2013, Peters signed a bipartisan letter to the Ways and Means Committee leadership urging “action to permanently extend and expand the New Markets Tax Credit.”

Need for Legislative Action: The NMTC program is not currently authorized beyond the current round of pending allocations. Additionally, the newly introduced tax reform proposal by Chairman Dave Camp would not extend the NMTC program despite over 1,200 businesses, investors, nonprofit organizations and community leaders calling on Congress to extend, make permanent and strengthen the program. Peters also joined a bipartisan coalition of 70 Members of the House of Representatives in aletter to the House Ways and Means Committee  indicating their support for the NMTC program.

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