New Markets Tax Credits (NMTC) are a placed-based tax-incentive program bringing outside equity to qualifying projects. Because NMTC transactions are complex, specialized and expensive to execute, Columbia Capital brings a similar approach as its bond financial advisory services to advising its clients on these projects.
Congress created the New Markets Tax Credits program in the early 2000s to incentivize private investment in
low income communities. Low income communities are those experiencing high unemployment, high rates of poverty or low median household incomes. The NMTC program provides a 39% Federal income tax credit on the amount of investment, paid over seven years.
NMTC financings are complex, challenging and expensive to transact. Columbia Capital's 25 years of deal execution experience, coupled with the expertise of its staff team in finance, law and economics, provides a valuable resource to sponsors and borrowers under the NMTC program. With advice provided on approximately $125 million of qualified equity investment, our team is ready to help your organization explore the world of NMTC.
Columbia Capital works with governments, non-profits and private companies to develop preliminary plans of finance, to evaluate the potential benefit of an NMTC financing, to develop credit packages to attract NMTC allocation and investment, to negotiate the terms and conditions of an NMTC allocation, to select attorneys and other team members, to secure sources of leverage, and to manage the execution process. We work to ensure the interests of our client are properly represented in the transaction and reflected in the financing documents.
After the transaction closes, Columbia Capital remains in touch with its NMTC clients to assure on-going compliance and to resolve issues that might arise over the seven-year compliance period. Once that compliance period ends, Columbia works closely with the community development entity and investor to ensure a smooth and low-cost exit to the transaction.
Assessing the Potential Value
The YMCA of Metropolitan Atlanta needed a long-term solution for its administrative offices and Head Start model classroom training center. Choosing to create a transformative project on Atlanta's Westside, the Y chose the site of the former E.A. Ware School, built in 1922 as one of the first elementary schools for African-American children in the city.
In partnership with Washburn University, GO Topeka—the joint economic development agency of the City of Topeka and Shawnee County, Kansas—identified the need for a job training center dedicated to building skills in high-growth job categories, including logistics, health services and construction trades.
Partnering with Purpose Built Communities, the Atlanta Public Schools (APS) and the YMCA of Metropolitan Atlanta, Grove Park Foundation spearheaded the redevelopment of the site of a former APS middle school as a community focal point: a K-8 community school, a family YMCA, a health clinic and a Head Start site.
Issuers and borrowers large and small, from coast to coast, have relied upon Columbia Capital as a strategic advisor for 25 years.
Columbia Capital combines 150 years of public finance expertise among its team of highly experienced, proven professionals.
Columbia Capital is unaffiliated with commercial and investment banks, insurance companies and others in the financial services industry.
Columbia Capital Management, LLC is a registered with the US Securities and Exchange Commission (SEC) and the Municipal Securities Rulemaking Board (MSRB) as a municipal advisor. The firm is also registered with the SEC as a registered investment adviser. Columbia Capital has a statutory duty to serve its governmental clients as a fiduciary.