New Markets Tax Credit Program: Progress Made in Implementation, but Further Actions Needed to Monitor Compliance
GAO-04-326
Published: Jan 30, 2004. Publicly Released: Jan 30, 2004.
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Highlights
The Community Renewal Tax Relief Act of 2000 authorized up to $15 billion under the New Markets Tax Credit (NMTC) program to stimulate capital investment in low-income and economically distressed communities. The act mandated that GAO report to Congress on the NMTC program by January 31, 2004, 2007, and 2010. Based on consultation with staff at appropriate congressional committees, this report (1) describes the status of the NMTC program, (2) profiles community development entities (CDE) that were selected to receive NMTC allocations in 2003, and (3) determines whether systems are in place or planned to ensure compliance and evaluate the success of the NMTC program.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of the Treasury | To ensure that compliance monitoring processes will be in place when needed, the Secretary of the Treasury should instruct the Director of the CDFI Fund and the Commissioner of Internal Revenue to develop plans, including milestones, for designing and implementing compliance monitoring processes for the NMTC program. |
The CDFI has implemented a compliance monitoring system for the Fund's New Market Tax Credit (NMTC) Program Compliance Monitoring Program. The NMTC Compliance Monitoring system (NCMS) is now operational and uses allocatee self-reported data from various systems that allows CDFI to monitor and track users' compliance with NMTC rules. In addition, several approved policies and procedures have been put in place: the Noncompliance Review Policies and Procedures and the NMTC Program Compliance Monitoring Policies and Procedures. CDFI also is in the process of clearing the NMTC Program Site-Visit Policies and Procedures.
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Topics
Community development programsData collectionEconomically depressed areasInvestmentsManagement information systemsMonitoringTax creditInternal controlsInvestment planningNew markets tax credit