Capital Impact Partners Awarded $60 million in New Markets Tax Credits To Attract Private Capital and Advance Social Impact Efforts

Award Will Spur Projects that Increase Access to Social Services in Disinvested Communities

Arlington, VA (September 1, 2021) — The U.S. Department of the Treasury’s Community Development Financial Institutions Fund (CDFI Fund) has awarded Capital Impact Partners a $60 million New Markets Tax Credit (NMTC) allocation. This award helps advance Capital Impact’s mission to increase access to critical social services in disinvested communities, spur economic development and wealth creation, and create jobs by incentivizing private sector investors to partner in its community financing efforts.

“The New Markets Tax Credit program allows us to serve as a conduit for capital between government agencies and private investors, to help underestimated communities address barriers to success caused by issues of systemic racism and disinvestment,” said Ellis Carr, president and chief executive officer of Capital Impact Partners and CDC Small Business Finance. “We are grateful for the trust that the CDFI Fund has in our ability to work with communities to uplift their needs and solutions.”

Capital Impact Partners is now a 10-time NMTC recipient – with those awards totaling more than $687 million. To date, the organization has used NMTC allocations to support the financing of more than 78 transactions nationally that have increased access to health care, education, healthy foods, affordable housing, and the ability for seniors to age in their communities with dignity.  

“Building equitable and inclusive communities requires investment from a broad spectrum of organizations,” said Diane Borradaile, chief lending officer of Capital Impact Partners. “The New Markets Tax Credit program helps us bring key partners together to support projects that unlock economic opportunity and generational wealth building.”

Today’s announcement brings the total amount awarded through the NMTC Program to $66 billion. Historically, NMTC Program awards have generated $8 of private investment for every $1 invested by the federal government. Through the end of fiscal year 2020, NMTC Program award recipients deployed almost $56 billion in investments for communities and businesses earning low incomes, with impacts such as the creation or retention of nearly 871,000 jobs and the construction or rehabilitation of nearly 231.5 million-square-feet of commercial real estate.

“These investments will create jobs and spur economic growth in urban and rural communities across the country,” Secretary of the U.S. Treasury Janet L. Yellen said. “Many of the communities that will receive these funds have confronted economic challenges over many decades. Challenges which have been made more difficult by a lack of investment. It’s critical that Congress sustain these investments over time by making the New Markets Tax Credit Program permanent.”

Creating High Impact Projects through NMTCs:

Capital Impact has deployed a variety of NMTC allocations to help launch projects nationwide. Examples of those high impact projects include:

Co-Locating Services: Health Care & Housing

To better serve homeless individuals residing in Los Angeles’ “Skid Row,” the new 23,468 sq. ft. Joshua House Health Center was built to replace a much smaller site nearby.

The Federally Qualified Health Center will offer primary care, dental, optometry, and mental health services, as well as a broad array of wellness services. The site will serve 7,000 patients, 2,200 more than in the previous facility. Ninety-nine percent of the clientele lives below 200 percent of the federal poverty level, and the expansion of services is vital to the continued health of the community. In addition, the health center will be co-located with a supportive housing facility, which will provide 55 units of permanent housing for homeless individuals.

Skid Row has the largest concentration of people experiencing chronic homelessness in the country. Estimates of Skid Row’s population range from 8,000 to 11,000 people. It is a predominantly Black male population, although the number of women and children has increased in recent years. 

Capital Impact joined with the Nonprofit Finance Fund, Los Angeles Development Fund, and U.S. Bank Community Development Corporation on this $25.9 million NMTC transaction.

Healthy Food:

Building in San Francisco, CA – one of the most expensive cities in the country – is a significant challenge. Yet, access to affordable, healthy food is needed more than ever. Meals on Wheels San Francisco (MOWSF) volunteers donate more than 20,000 hours and staff serve nearly 5,000 clients–providing in-home wellness and safety checks, nutrition counseling, and companionship. With demand rising, MOWSF invested in a new 37,000 sq. foot kitchen facility that could make 10,000 meals in one shift, while  having the capacity for two [eight-hour] shifts and maximizing access to seven days a week.

The MOWSF program is very cost effective. It costs about $10 per day for the food and delivery of two meals and safety checks for a homebound senior. Meals can be provided for an entire year for roughly the same cost as one day in a hospital. A 2013 study found that if every state increased the number of older Americans who received meals by just 1 percent, it would save Medicaid more than $109 million in medical costs annually. 

Capital Impact joined with JPMorgan Chase, San Francisco Community Investment Fund, Community Vision (formerly known as Northern California Community Loan Fund), and First Republic Bank on this $41 million NMTC project.


Marygrove Conservancy is a nonprofit organization that was established to operate and steward the 53-acre Marygrove College campus in Detroit after its closure in 2019. Marygrove Conservancy’s primary objective is to facilitate the redevelopment of the campus as a cradle-to-career, pre-Kindergarten to graduate degree “P-20” education campus.  

The newly constructed single-story building will encompass approximately 29,000 sq. ft. of space designed to support and provide wrap-around services to 144 children (infant to Pre-K) across the socioeconomic spectrum. To ensure income diversity, half of the slots will be federally subsidized through Early Head Start and Head Start programs. The project will create 12 classrooms and will have focused therapy rooms that will include play therapy, health therapy, and sensory rooms. 

Starfish Family Services, a respected social service agency and early childhood provider in the metro Detroit market, will operate the site. Starfish is currently working with the University of Michigan to develop a year-round infant/toddler curriculum for the project that is designed specifically for a diverse group of children in an urban setting.

Capital Impact joined with the Northern Trust Company and the Kresge Foundation on this $22 million NMTC project.

Community Hubs:

Small nonprofit organizations serving underinvested communities do not always have the funds to cover operating costs like office space and legal services. In Denton, Texas, the organization Serve Denton helps to fill that gap, enabling nonprofits to be financially self-sufficient and serve their communities while co-located services benefit community members. 

With the construction of a new 48,000 sq. ft. hub, Serve Denton will provide space for a Federally Qualified Health Center, a food bank, and many other nonprofit service providers in the area. The organizations will have affordable office space and will share operating costs so that each can focus more funds on its clients.

Capital Impact joined with U.S. Bank to support this $9.5 million NMTC project.

How Do New Markets Tax Credits Work?

Managed by the CDFI Fund, NMTC allocations make their way into the community through the following process:

  • A community development entity (CDE) submits an application to the CDFI Fund requesting the authority to allocate a specific dollar amount of tax credits.
  • If its application is approved, the CDE is awarded the authority to allocate tax credits to an investor.
  • The investor chosen by the CDE receives a tax credit totaling 39 percent of the cost of the investment. The investor can claim that tax credit over a period of seven years.
  • In exchange for those tax credits, the investor makes a qualified equity investment (QEI) in the CDE.
  • The CDE must use the QEIs it receives from the investor to finance businesses or real estate projects in communities living with low incomes, where the poverty rate is 20 percent or higher or the median income is 80 percent or lower than the Area Median Income. The CDE also has the option of investing in other CDEs making loans in areas with residents earning low incomes.

About Capital Impact Partners:

Through capital and commitment, Capital Impact Partners helps people build communities of opportunity that break barriers to success. We work to champion key issues of equity and social and economic justice by deploying mission-driven financing, capacity-building programs, and impact investing opportunities. 

A nonprofit Community Development Financial Institution, Capital Impact has disbursed more than $2.5 billion since 1982. In 2020, Capital Impact launched a new enterprise with CDC Small Business Finance under one leadership team and national strategy to reinvent traditional and mainstream financial systems. Our goal is to ensure these systems equitably serve communities of color to drive community-led solutions that support economic mobility and wealth creation. 

Our leadership in delivering financial and social impact has resulted in Capital Impact being rated by S&P Global and recognized by Aeris for our performance. Headquartered in Arlington, VA, Capital Impact Partners operates nationally, with local offices in Austin, TX, Detroit, MI, New York, NY, and Oakland, CA.

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