The NMTC Financing Must be “Shovel Ready”

A Borrower must show that:

• all other sources of financing are otherwise committed (or close to being committed);
• all other conditions are satisfied (or close to being satisfied), such as having site control, zoning approvals, permits, and good title etc.;
• if a for-profit, revenues (as opposed to net income) are reasonably expected to be generated within 3 years;
• if a nonprofit organization, one or more of its charitable purposes are reasonably expected to be furthered within 3 years; and
• substantial community impacts will be timely achieved.

There is significant competition to obtain NMTC financing from CDEs.  Accordingly, a Borrower should proactively provide sufficient information regarding its proposed NMTC financing to CDEs.  This permits CDEs to include such proposed NMTC financing in their annual NMTC allocation applications to the Community Development Financial Institutions Fund.  Upon a CDE’s receipt of any NMTC allocation award, the Borrower is generally in a position to timely close upon the CDE’s receipt of a NMTC allocation award.