U.S. bank receives $60 million New Markets Tax Credit allocation

U.S. bank receives $60 million New Markets Tax Credit allocation

ST. LOUIS, Mo.–(BUSINESS WIRE)–US Bank’s Community Development Entity (CDE) – USBCDE, LLC – has received $60 million in New Markets Tax Credit (NMTC) from the United States Department of Treasury. The allocation was one of the largest given this round and is part of the federal government’s $5 billion NMTC program, which helps economically distressed communities attract private investment capital.

USBCDE was one of 107 CDEs to receive a share of the NMTC Allocation Authorization Package announced by the Treasury’s Community Development Financial Institutions Fund (CDFI Fund). This is the bank’s twelfth award under the NMTC program and the fifth consecutive year it has received an award. Since its inception, USBCDE has invested more than $870 million in communities across the country, helping create more than 59,000 jobs and increasing service capacity in community facilities like schools and health care centers. by more than 1.8 million people a year.

Recent projects funded by USBCDE with its grant include the expansion of the Dewberry, a multi-tenant healthcare facility in Birmingham, Alabama that serves uninsured and underinsured low-income people living with HIV. /AIDS; purchasing equipment and inventory for Ogaakaaning Wild Rice in Bemidji, Minnesota, which is the first Red Lake Nation of Chippewa-owned business to operate off the Red Lake Nation Reservation; an infrastructure project in the Crenshaw neighborhood of Los Angeles that will create a hub for Black art, culture and commerce, including pocket parks, landscaping, public art and business support local; and a complete redevelopment of the historic Lexington Market, one of the nation’s oldest markets and a key anchor on Baltimore’s downtown west side.

The NMTC program is an economic development tool that injects capital into regions that need it most. CDEs allocate tax credits to projects, attracting private investment capital that helps grow businesses and create jobs in economically challenged communities. According to the Treasury Department, NMTC program grants generate more than $8 in private investment for every $1 invested by the federal government.

In addition to the work done through its CDE, US Bank is also the most active NMTC investor in the country, having invested more than $7.3 billion nationwide in a wide variety of development projects. nationwide economy.

Laura Vowell, managing director of Community Finance Solutions for US Bancorp Community Development Corporation – the bank’s tax credit and community investment subsidiary – credits the CDE’s strategic shift several years ago to use its allocation to spur l investing in communities of color, where racial barriers have perpetuated inequality.

“We are intentional about how we invest our own allocation, focusing on targeted stocks. We prioritize projects that help close the racial wealth gap, create quality jobs, provide essential services, and create wealth by making investments that support or are owned or directed by people of color,” said Vowell, who leads the bank’s NMTC business and USBCDE, LLC. .

Commission income received in the context of these projects is also reinvested; USBCDE distributes it as grants to organizations focused on racial equity and has provided $6.9 million to organizations and communities since 2013.

“We take our role as a large investor very seriously,” Vowell said. “We are constantly looking for ways to better leverage our power and influence to advance racial equity in the industry.”

In addition to being a strong advocate for greater equity in the NMTC industry, US Bank has provided technical assistance, dollar grants, and referrals for third-party support to several CDE people of color to help complete the grant application. USBCDE also deploys a portion of its own allocation to emerging and people-of-color-led CDEs through the Intermediate CDE Model – a partnership that helps CDE establish an NMTC track record, provides the opportunity to deploy this resource within of their selected community, and is a potential success factor in securing future allocation.

Overall, about 20% of this year’s recipients and allocations went to CDEs run by people of color.

“We are pleased to see a modest improvement in representation with this round of awards,” Vowell said. “We will continue to look for ways to personally partner with CDEs of color and help them earn their own stipend.”

USBCDE’s intentional focus on racial equity supports the Access to American Banking Pledge, the company’s long-term approach to help build wealth while redefining the way banking is done. serving racially diverse communities and providing more opportunities for diverse employees.

About US Bank

US Bancorp, with approximately 70,000 employees and $601 billion in assets as of September 30, 2022, is the parent company of the US Bank National Association. The Minneapolis-based company serves millions of customers locally, nationally and globally through a diverse array of businesses: personal and business banking; payment services; Business and corporate banking services; and wealth management and investment services. The company has been recognized for its approach to digital innovation, social responsibility and customer service, including being named one of the 2022 World’s Most Ethical Companies and Fortune’s Most Admired Superregional Bank. Learn more at usbank.com/about.

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