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New Markets Tax Credits

New Markets Tax Credits (NMTC) works to encourage and jumpstart investment in low-income census tracts to create jobs and bring new opportunities to qualifying areas in North Dakota. The goal of the NMTC award is to fill a financing gap for transformative projects which bring opportunities to low-income or distressed areas.

New Markets Tax Credits

New Markets Tax Credits (NMTC) works to encourage and jumpstart investment in low-income census tracts to create jobs and bring new opportunities to qualifying areas in North Dakota. The goal of the NMTC award is to fill a financing gap for transformative projects which bring opportunities to low-income or distressed areas.

NMTC Dollars Allocated

Jobs Created/Retained

Direct Project Impact

Bringing High-Impact Investment to Distressed Community Areas

History

The New Markets Tax Credits (NMTC) program was created through the Community Renewal Tax Relief Act of 2000 and is administered through the U.S. Department of Treasury.

How is it Funded?

New Markets Tax Credits is funded by DBL Equity Partners, an entity of Dakota Business Lending, through a process of investing in and monetizing tax credits to fill a financing gap.

Step 1: Allocate

Dakota Business Lending will secure allocation from the U.S. Department of Treasury.

Step 2: Monetize

The funds will flow through DBL Equity Partners (a division of Dakota Business Lending), who will work to monetize the allocation by selling tax credits.

Step 3: Get Cash

The cash from the tax credit sales will come back at a 39% basis.

Step 4: Invest

DBL Equity Partners will use this cash (approx. 25-30% of allocation) to fill the financing gap in projects located in low-income or distressed areas.

Qualifications

In order to be eligible for NMTC, projects must be:

  • Located in a qualifying census tract in North Dakota
  • The size and scale to be transformative to the (re)development of the distressed area
  • Adaptable to the unique structure and requirements of the program

Project Example: Business Expansion

Z

Project Total: $10 Million

Z

Bank Loan: $5.2 Million

Z

Owner Capital: $2 Million

Z

Gap: $2.8 Million

Criteria: 

  • Transformative Project
  • Job Creation and Retention
  • Low-Income Census Tract
  • Unique Structure
  • 7 Year Compliance

NMTC Success Stories

There are many stories of how this high impact financial solution has helped communities and businesses thrive. Below are a few examples.

Tecton Products, LLC

Expansion of a manufacturing facility with emphasis to increase product line capacities, upgrade and expand equipment, & add office space.

  • 23.9% poverty rate
  • Median income 54.34% of area median income
  • Urban
  • Project cost: $32.9 million
  • 140 direct jobs
  • NMTC allocation: $7.2 million

NuTek Natural Ingredients

Expansion of manufacturing facility and associated equipment, including a state-of-the-art technology center with a Research & Development lab and pilot plant capabilities.

  • 23.9% poverty rate
  • Median income 54% of area median income
  • Urban
  • Project cost: $23 million
  • 27 direct jobs
  • NMTC allocation: $7.1 million

Dakota MB

Construction of production facility to create warehouse space, increase blending capacity, and add a state-of-the-art commercial toasting line.

  • 12.9% poverty rate
  • Median income 54% of area median income
  • Urban
  • Project cost: $7.4 million
  • 14 direct jobs
  • NMTC allocation: $7.1 million

Had it not been for the NMTC program, these projects would not have moved forward. As you can see from the numbers, the impact on low income and distressed areas is significant in many ways.

Eligible Areas in North Dakota

Projects located in qualifying census tracts are eligible for NMTC, which are represented by red and yellow on the map.

You can find eligible pockets within the circled cities by zooming in on the map found here.

Creating Impact that Snowballs… Encouraging the “Pay-it-Forward” Concept

One of the ways that DBL Equity Partners and the NMTC program will work to maximize and spread economic impact is by encouraging the “pay-it-forward” concept – an approach that promotes the “repaying” of kindness by passing along assistance and support to others in need. For many small businesses, this entails donating to a specific charity or cause.

Here is an example of a project that was significantly impacted by the NMTC program and used the pay-it-forward concept to further support the workforce in their local community.

Expansion of Clean Label Ingredient Manufaturing Facility

  •  23.9% poverty rate
  • Median income 54% of area median income
  • Urban
  • Project cost: $23 million
  • 27 direct jobs
  • NMTC allocation: $7.1 million
  • $50,000 pay-it-forward donation to three non-profits

    Workforce Development and Diversity

    As part of the overall strategy on NMTC projects and the direct concern with workforce and labor, NMTC projects will contribute toward some strategy or program that addresses workforce and the quality of the workforce. One such investment came from a manufacturing company that donated a total of $50,000 to several local community organizations, including YMCA of Cass and Clay Counties, YWCA Cass Clay, and the F5 Project. This helps support diversity in the workforce, expand education and employment resources, and provide immediate impact in Cass and Clay County communities.

    Have a NMTC project in mind or want to learn more?

    Contact us with questions, download our NMTC flyer for more information, or fill out a project intake form and help us bring this great investment opportunities to our state.

    Phone
    Address

    5630 36th Ave S,
    Fargo, ND 58104
    ______________________

    207 W. Main St. Ste. 2,
    Office 4
    Lewistown, MT 59457

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