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At Dakota Business Lending, our mission goes far beyond financing.
We believe in driving economic growth and transforming businesses across our footprint. In 2021, we decided to take this mission to a whole new level with the NMTC program (also known as the New Markets Tax Credit program)…giving us even more opportunities to create the best and most unique financing packages to support our borrowers and lending partners. And we’re excited to share all about it!
In this issue, we want to take you through a wide range of topics related to NMTC to show you just how impactful this program can be. But where do we begin? Let’s start at the very beginning…
What is NMTC?
NMTC is not just a financing program; it’s a transformative opportunity centered around filling very specific financing gaps for small businesses across the nation. The program, administered by the U.S. Department of Treasury, works on incentivizing private investors to fund projects in low-income and distressed areas to help drive economic growth.
What makes the NMTC program so transformative?
Bridging Gaps
The NMTC program is known for its ability to bridge financing gaps for projects that would otherwise struggle to secure funding. Through the “but-for” test (“but for” NMTC, the project would not be possible), NMTC determines whether a project can proceed with its financial support…ensuring significant and transformative impact.
Collaboration and Partnerships
NMTC cannot be administered in a silo! Another essential component of the program is strong partnerships between Community Development Entities (CDEs), financial institutions, and other local stakeholders that help further its impact. This brings together all kinds of entities under one mission to support businesses and transform local economies.
Targeting Underserved Markets
The NMTC program was created specifically to assist low-income and distressed census tracts across the nation. By focusing on these key areas, NMTC directs investment where it can make the greatest impact, revitalizing neighborhoods and driving economic growth where it’s needed most.
Economic Impact
NMTC is all about impact, and the program has certain parameters in place to measure that impact and ensure that it is maximized to its full potential. NMTC-supported projects in ND target job creation, both during construction phases and through permanent employment opportunities, creating quality and accessible jobs. The program also works to develop other critical aspects such as improving access to critical goods and services and boosting the local economy.
For more information about the NMTC program, visit our webpage or reach out to a loan officer in your area.
