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Ohio New Markets Tax Credit Program


Contact Information

Carrie Manno
Business Services Coordinator
Business Services Division
(614) 466-6667
Carrie.manno@development.ohio.gov

Seven Organizations Receive Ohio New Markets Tax Credits

The Ohio New Markets Tax Credit helps finance business investments in low-income communities by providing investors with state tax credits in exchange for delivering below-market-rate investment options to Ohio businesses. Below are the Community Development Entities that received awards for Round 8 of the program:

Cincinnati Development Fund (Hamilton County) will receive $3 million in tax credits for a minimum of $7.6 million in investments. It has received six previous Federal New Markets Tax Credit program allocations, totaling $252 million, and was awarded a $50 million Federal New Markets Tax Credit program allocation in the February 2018. Its service area is Hamilton County.

Cincinnati New Markets Fund, LLC (city of Cincinnati) will receive $2 million in tax credits for a minimum of $5.12 million in investments. It has received five allocations from the Federal New Markets Tax Credit program, totaling $198 million. Its service area is the City of Cincinnati.

Finance Fund (Statewide) will receive $1 million in tax credits for a minimum of $2.56 million in investments. It has received 10 allocations from the Federal New Markets Tax Credit program, totaling $360 million. Its service area includes the entire state of Ohio.

Brownfield Revitalization, LLC (National) will receive $1 million in tax credits for a minimum of $2.56 million in investments. It has received six allocations from the Federal New Markets Tax Credit program, totaling $361 million. Its service area includes the entire state of Ohio.

BizCapital BIDCO II, L.L.C. (Statewide) will receive $1 million in tax credits for a minimum of $2.56 million in investments. BizCapital BIDCO II’s federal allocatee, Advantage Capital Community Development Fund, has received 11 allocations from the Federal New Markets Tax Credit program, totaling $739 million. BizCapital BIDCO II’s service area is the state of Ohio.

Cleveland New Markets Investment Fund II, LLC (Cuyahoga County) will receive $1 million in tax credits for a minimum of $2.56 million in investments. It has received five allocations from the Federal New Markets Tax Credit program, totaling $200 million. Its service area is Cuyahoga County.

Dayton Region New Market Fund, LLC (Local) will receive $1 million in tax credits for a minimum of $2.56 million in investments. It has received three allocations from the Federal New Markets Tax Credit Program, totaling $71 million. Its service area is Montgomery, Clinton, Champaign, Clarke, Preble, Darke, Greene, Miami and Warren counties.

Overview

The Ohio New Markets Tax Credit program provides an incentive for investors to fund businesses in low-income communities. These "new markets" are traditionally underserved by private sector capital. This lack of capital stifles entrepreneurs and impedes growth, despite promising opportunities for investment and business expansion.

The Program awards tax credit allocation authority to Community Development Entities (CDE) serving Ohio that serve as an intermediary between investors and projects. The investor provides cash to a CDE in exchange for the tax credit (39 percent of their investment claimed over seven years). The CDE uses the cash for projects in low-income communities.

$10 million in tax credit allocation authority is available to CDEs each year.

For Whom

Tax credit allocation authority is awarded to Community Development Entities, who sell the credit to investors and use that money for high-impact projects. The tax credit can be applied to applicable financial institutions, and foreign and domestic insurance premiums.

Benefits

  • Businesses in the low-income community receive below-market, non-traditional or flexible loans or equity for their project.
  • The low-income community where the business is located receives increased investment in the area, new job opportunities and potentially services or products that are made available through the new business.
  • Community Development Entities use the tax credit as a means to achieve their mission of investing in and serving low-income communities.
  • Investors reduce their tax liability and receive a positive return on their investment.

How to Apply

Applications are received annually in the spring for the Ohio New Markets Tax Credit. Qualified CDEs with available federal allocation file a competitive application with the Ohio Development Services Agency. Awards are typically made in the summer. The application will be available on the left under ‘Application Information’.