What is it like to work with Rural Development Partners (RDP) to finance a rural expansion through New Markets Tax Credits? We think this three-minute video and the short article below provide a unique perspective into NMTC financing that benefits organizations, communities, and workforce.
Who is Rural Development Partners?
Rural Development Partners’ mission is to forge public-private partnerships for catalytic job growth in rural America. We offer financing through the New Markets Tax Credit Program to help operating businesses expand to create high quality, accessible jobs, and healthy food access to distressed rural areas across the US. Rural Development Partners does this by pairing tax credits with multiple private and public financing sources, providing the equity needed to fill funding gaps and reduce the financial risks to an acceptable level for all parties.
Rural Development Partners is a Community Development Entity with a nationwide service area, eligible to apply for an annual allocation of Federal New Markets Tax Credits. From 2004 through 2020, RDP has won nine NMTC awards from the U.S. Treasury totaling $606.7 million. We work to combine NMTCs with bank loans and tax credit investors to create a more favorable financing solution than what is available through conventional lending and investing.
What Could New Market Tax Credits Do for Your Organization?
The New Markets Tax Credit utilizes a complex, but well-established, financing model in which the traditional capital stack of loans, grants, and owner equity is paired with tax credit equity provided by a banking institution. Rural Development Partners will be with the business every step of the way, bringing together and working effectively with financing partners, attorneys, accountants, and others to effectively administer the program. Even more importantly, we will help the business bring high-quality accessible jobs and private capital investment to distressed rural communities. The tax credit equity pays for the financing costs and approximately 15 to 25% of the entire project cost, depending on the tax equity market and project efficiencies. The financing structure requires the creation of multiple entities. Both initial funding and the repayment schedule are strictly controlled throughout the program so the investor can properly claim the tax credits over a 7-year period. Funding for the entire project flows through an entity controlled by Rural Development Partners in the form of loans with market or below-market interest-only payments for seven years.
How Can We Help?
Rural Development Partners brings together partners that need each other, and then we help them succeed together. We leverage New Markets Tax Credit financing to encourage private capital toward rural communities hungry for economic growth and quality jobs that fit their workforce. Whether you’re part of an organization considering expansion, or a rural community seeking to grow and provide opportunities for your citizens, contact us and let us help you take the next step. https://www.rdpimpact.com/contact/