Welcome!

News Feed Item

Two New Reports Paint an Incomplete and Inaccurate Picture of the New Markets Tax Credit

WASHINGTON, Aug. 11, 2014 /PRNewswire/ -- Two reports were released on the New Markets Tax Credit (NMTC), one by the Government Accountability Office (GAO) and another by Senator Tom Coburn (R-OK), respectively "Better Controls and Data are Needed to Ensure Effectiveness" and "Banking on the Poor." In both his press release and report, which was released concurrently with the GAO report that he commissioned, Senator Coburn offered his long-standing criticism of the NMTC, claiming that the projects result in the government choosing favorites.

NMTC financed manufacturing facility in Sumter, SC is expected to create 1,600 new full-time, permanent jobs—90 percent of which will be entry level.

"Washington doesn't pick the winners and losers when it comes to the NMTC. It is a market driven program based in a philosophy that communities know best, they just need access to capital," said Bob Rapoza, spokesperson for the NMTC Coalition. "Through public-private partnerships, the Credit brings community revitalization projects to fruition that likely would not have gone forward if not for NMTC financing."

The NMTC Coalition further substantiates this claim by pointing to a prior report in which the GAO found that 88 percent of investors would not have made their investments, but for the incentive of the Credit.

The Coburn report notes that the impetus for the New Markets Tax Credit is to help struggling communities. He contends it does not succeed in this, writing that "Most of the country, however, is considered a low-income community for purposes of the program." However, data from the U.S. Department of Treasury indicates that the NMTC has delivered more than $60 billion in capital to businesses and revitalization projects nationwide in some of the poorest communities; these investments have generated over 550,000 jobs and  of the 74,134 census tracts in America, only 30,099 (41%) qualify. Moreover, according to the NMTC Coalition's survey of 2013 NMTC projects, 80 percent of investments went to severely distressed census tracts that far exceed the statutory requirements for investment.

The Senator's report profiled 19 projects to which it objected.  Yet, analysis of the profiles of those communities indicate they are among the poorest in the country, with an average poverty rate of over 32 percent and an unemployment rate of 11.7 percent at the time the project was financed.  In these high distress communities, the NMTC delivered $770 million in financing and created over 7,700 jobs.

"The hallmark of the credit is its flexibility, which allows for diversity in projects based on needs and opportunities identified by citizens and local leaders—the vast majority of which include child and health care facilities, grocery stores, and manufacturing facilities," said Rapoza.

Like the report from Senator Coburn, the GAO report ignores the challenges of investing in low-income communities and the success that the NMTC has in spurring revitalization in urban neighborhoods, small towns and farming communities.  Furthermore, GAO does not provide an accurate analysis of the operations of the NMTC. In one such case, the GAO overestimated an investor return by 400 percent through faulty analysis. In this case, GAO authors used incomplete information based on one example in a second-party report that they could not independently verify. Consequently, GAO implies the financial structures used in NMTC transactions allow investors to receive an unduly large return on their investments, claiming a 24 percent annual return to the investor, when actual NMTC investor returns align with market rates of 6 to 7 percent annually.

"Unfortunately, some conclusions are based on misinterpreted data and flawed calculations. The Coburn report builds on those errors to cast a sensationalized and inaccurate portrayal of the NMTC," Rapoza adds.

Please visit the New Markets Tax Credit Coalition's website for more information on the credit and how it works.

About New Markets Tax Credit Coalition

The NMTC Coalition is a national membership organization of Community Development Entities and investors organized to conduct research on and advocacy for the New Markets Tax Credit. The Coalition hosts two annual conferences and regularly publishes the NMTC Bulletin. To learn more, please visit www.nmtccoalition.org.

Contact: Bob Rapoza
[email protected]
(202) 393-5225

Photo - http://photos.prnewswire.com/prnh/20140811/135161

SOURCE New Markets Tax Credit Coalition

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
"There's a growing demand from users for things to be faster. When you think about all the transactions or interactions users will have with your product and everything that is between those transactions and interactions - what drives us at Catchpoint Systems is the idea to measure that and to analyze it," explained Leo Vasiliou, Director of Web Performance Engineering at Catchpoint Systems, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York Ci...
Redis is not only the fastest database, but it is the most popular among the new wave of databases running in containers. Redis speeds up just about every data interaction between your users or operational systems. In his session at 19th Cloud Expo, Dave Nielsen, Developer Advocate, Redis Labs, will share the functions and data structures used to solve everyday use cases that are driving Redis' popularity.
UpGuard has become a member of the Center for Internet Security (CIS), and will continue to help businesses expand visibility into their cyber risk by providing hardening benchmarks to all customers. By incorporating these benchmarks, UpGuard's CSTAR solution builds on its lead in providing the most complete assessment of both internal and external cyber risk. CIS benchmarks are a widely accepted set of hardening guidelines that have been publicly available for years. Numerous solutions exist t...
"We're bringing out a new application monitoring system to the DevOps space. It manages large enterprise applications that are distributed throughout a node in many enterprises and we manage them as one collective," explained Kevin Barnes, President of eCube Systems, in this SYS-CON.tv interview at DevOps at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
Choosing the right cloud for your workloads is a balancing act that can cost your organization time, money and aggravation - unless you get it right the first time. Economics, speed, performance, accessibility, administrative needs and security all play a vital role in dictating your approach to the cloud. Without knowing the right questions to ask, you could wind up paying for capacity you'll never need or underestimating the resources required to run your applications.
SYS-CON Events announced today that LeaseWeb USA, a cloud Infrastructure-as-a-Service (IaaS) provider, will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. LeaseWeb is one of the world's largest hosting brands. The company helps customers define, develop and deploy IT infrastructure tailored to their exact business needs, by combining various kinds cloud solutions.
Adding public cloud resources to an existing application can be a daunting process. The tools that you currently use to manage the software and hardware outside the cloud aren’t always the best tools to efficiently grow into the cloud. All of the major configuration management tools have cloud orchestration plugins that can be leveraged, but there are also cloud-native tools that can dramatically improve the efficiency of managing your application lifecycle. In his session at 18th Cloud Expo, ...
The competitive landscape of the global cloud computing market in the healthcare industry is crowded due to the presence of a large number of players. The large number of participants has led to the fragmented nature of the market. Some of the major players operating in the global cloud computing market in the healthcare industry are Cisco Systems Inc., Carestream Health Inc., Carecloud Corp., AGFA Healthcare, IBM Corp., Cleardata Networks, Merge Healthcare Inc., Microsoft Corp., Intel Corp., an...
SYS-CON Events announced today the Kubernetes and Google Container Engine Workshop, being held November 3, 2016, in conjunction with @DevOpsSummit at 19th Cloud Expo at the Santa Clara Convention Center in Santa Clara, CA. This workshop led by Sebastian Scheele introduces participants to Kubernetes and Google Container Engine (GKE). Through a combination of instructor-led presentations, demonstrations, and hands-on labs, students learn the key concepts and practices for deploying and maintainin...
StackIQ has announced the release of Stacki 3.2. Stacki is an easy-to-use Linux server provisioning tool. Stacki 3.2 delivers new capabilities that simplify the automation and integration of site-specific requirements. StackIQ is the commercial entity behind this open source bare metal provisioning tool. Since the release of Stacki in June of 2015, the Stacki core team has been focused on making the Community Edition meet the needs of members of the community, adding features and value, while ...
Using new techniques of information modeling, indexing, and processing, new cloud-based systems can support cloud-based workloads previously not possible for high-throughput insurance, banking, and case-based applications. In his session at 18th Cloud Expo, John Newton, CTO, Founder and Chairman of Alfresco, described how to scale cloud-based content management repositories to store, manage, and retrieve billions of documents and related information with fast and linear scalability. He addres...
Is your aging software platform suffering from technical debt while the market changes and demands new solutions at a faster clip? It’s a bold move, but you might consider walking away from your core platform and starting fresh. ReadyTalk did exactly that. In his General Session at 19th Cloud Expo, Michael Chambliss, Head of Engineering at ReadyTalk, will discuss why and how ReadyTalk diverted from healthy revenue and over a decade of audio conferencing product development to start an innovati...
Amazon has gradually rolled out parts of its IoT offerings in the last year, but these are just the tip of the iceberg. In addition to optimizing their back-end AWS offerings, Amazon is laying the ground work to be a major force in IoT – especially in the connected home and office. Amazon is extending its reach by building on its dominant Cloud IoT platform, its Dash Button strategy, recently announced Replenishment Services, the Echo/Alexa voice recognition control platform, the 6-7 strategic...
Ovum, a leading technology analyst firm, has published an in-depth report, Ovum Decision Matrix: Selecting a DevOps Release Management Solution, 2016–17. The report focuses on the automation aspects of DevOps, Release Management and compares solutions from the leading vendors.
Continuous testing helps bridge the gap between developing quickly and maintaining high quality products. But to implement continuous testing, CTOs must take a strategic approach to building a testing infrastructure and toolset that empowers their team to move fast. Download our guide to laying the groundwork for a scalable continuous testing strategy.