New Markets Tax Credits Program

“We’re very happy that Wells Fargo joined up with us to make this happen.”

Moctesuma Esparza, Movie Producer & Founder, Maya Cinemas

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We provide custom financing for projects using New Markets Tax Credits (NMTCs) that are unable to obtain complete funding through traditional lenders, and help them gain entrance into the marketplace and create true, sustainable economic development.

Wells Fargo acts as a:

  • Lender
  • Tax credit investor through third-party Community Development Entities (CDEs)
  • Tax credit aggregator

We serve a variety of asset classes, including but not limited to:

  • Neighborhood serving retail
  • Community facilities
    • Healthcare clinics
    • Charter schools and child care centers
  • Mixed-use and transit-oriented developments
  • Operating businesses
    • Performing arts center


Our customers are experienced project sponsors who support non-profit organizations, for-profit organizations, small and middle-market businesses, and real estate redevelopment projects, all in economically distressed locations. Our customers also include CDEs, consultants, and Community Development Financial Institutions (CDFIs).

Financing size

  • Generally $7.5 million to $50 million
  • 7-year construction/term loans, often interest-only or with minimal amortization

NMTC debt programs

We provide impact capital for qualified projects, generally in two forms:

  • Gap equity. NMTC subsidy in the form of subordinated debt to qualified projects, in addition to an underlying market-rate debt component.
  • Reduced interest rate loan. NMTCs are applied to structure the loan with a reduced or below-market rate.

The New Markets Tax Credit (NMTC) program is a federal tax incentive authorized by Congress in 2000 to help spur the investment of capital in small businesses and commercial real estate located in communities of need. Through NMTC allocations, Wells Fargo reduces borrowing costs for non-profits and entrepreneurs by offering below-market rate financing on more favorable credit terms than conventionally available.

Eligible communities

Targeted communities are in highly distressed areas and generally have at least one or more of the following characteristics:

  • Poverty rates greater than 30%
  • Unemployment rates at least 1.5 times the national average
  • Median income less than 60% of area median income
  • Located in empowerment zones, enterprise and renewal communities, HUB zones and Brownfield sites
  • Located in a redevelopment project area

Eligible businesses

There are three primary types of businesses eligible for the New Markets Tax Credit Program:

  1. Community facilities (such as charter schools, child care centers, healthcare clinics, and community and performing arts centers)
  2. High-impact real estate development (such as redevelopment projects, mixed-use and transit-oriented developments, and neighborhood-serving retail developments)
  3. Job creation and small business finance (such as owner-occupied facilities finance and expansion capital projects)