The New Markets Tax Credit (NMTC) has proven to be a successful public-private partnership with broad bipartisan support to bring impactful investments to communities that need it most. Today, we’re sharing the story of Mott Community College’s (MCC) Culinary Arts Institute in Flint. Through creative local partnerships and a NMTC investment provided by Cinnaire, MCC was able to restore an abandoned facility to help meet the growing demand for job training and better career opportunities in Flint.
With Congress considering infrastructure legislation, there is an opportunity for historic levels of investment in affordable housing and community development programs. Last week, the House Ways and Means Committee approved legislation to finally make the NMTC permanent and expand its capacity to support projects like the MCC Culinary Institute.
Cinnaire recently received a $60 million award from the CDFI Fund. Since 2009, Cinnaire is an eight-time NMTC recipient with awards totaling more than $419 million. Over the history of the program, Cinnaire has leveraged NMTC investments to finance 42 high-impact projects in disinvested communities with a total development cost of $1.46 billion.
NMTC Provides Financing to Support Mott Community College Culinary Arts Institute
Like many communities grappling with the fallout from the exodus of the car industry, the City of Flint, Michigan, has long struggled to regain its economic footing. Looking to address high levels of unemployment and a poverty rate of 40%, community leaders have focused on expanding job training programs to create career opportunities for their residents. Unfortunately, when communities face high unemployment, they often struggle to find the resources they need to create opportunities and revitalize neighborhoods.
Mott Community College’s (MCC) Culinary Arts Institute sought to increase its enrollment to meet the swelling demand for its programs, however, it faced a challenge: How would a community college focused on keeping tuition affordable raise major funding needed to build a facility large enough to train its growing student population?
The answer came from a successful public-private partnership – the federal New Markets Tax Credit (NMTC) – that brought a major financial investment to make this community-led project possible. With NMTC funds, MCC repurposed an abandoned building that will help revitalize downtown Flint. The story of MCC’s Culinary Institute provides a powerful example of the impact of the NMTC program in helping communities build projects that empower them and their residents to thrive.
Meeting the Demand for Local Job Training
MCC has offered a culinary arts program for many years, training students to succeed in the food services industry. Demand for this program was strong enough for school administrators to determine that they could double their enrollment. There just wasn’t enough space to accommodate that many new students.
Fortunately, MCC was able to partner with a local nonprofit, the Uptown Reinvestment Corporation, to repurpose the 100-year-old Woolworth Building, an abandoned and vacant structure in downtown Flint. The building, donated by the C.S. Mott Foundation, would provide the space MCC needed, but it required major renovation. The community college couldn’t fund this on its own while keeping tuition affordable.
The project received strong philanthropic support – the donation of the building and several multimillion-dollar grants, including a $1.5 million grant from the State of Michigan. These grants helped leverage a difference-making $9 million investment from Cinnaire, made possible by the NMTC program.
The restored facility, opened in 2019, has enabled MCC to significantly increase its number of students, who are taught by award-winning executive chefs and food service professionals, while gaining real world experience onsite. The new facility is a catalyst, allowing graduates to procure steady employment, creating new, high-quality jobs and spurring additional revitalization in an area of downtown Flint designated as the city’s Health and Wellness district, promoting positive eating habits and physical fitness.
The Need to Make the New Markets Tax Credit Permanent
The MCC project is a prime example of how the federal NMTC program can bring impactful investments to areas lacking opportunities for growth and development. Originally created by Congress in 2000, NMTC attracts private capital to worthwhile projects like the Mott CC Culinary Institute in underserved rural and urban communities alike. Unfortunately, this proven program has never been permanently authorized by Congress, leaving it subject to short-term extensions that cast doubt on the program’s future.
The NMTC has been an effective and crucial economic development tool for low-income communities like Flint. To date, the NMTC has delivered more than $105 billion in capital, generating more than 1 million jobs in both urban and rural neighborhoods. In Michigan alone, NMTC has brought nearly $3 billion in capital and more than 29,000 jobs. Its outstanding track record includes flexible financing for a range of impactful projects, from early childhood education to manufacturing.
NMTC has been especially critical in bringing investment to minority communities. Of the $51 billion in NMTC allocation deployed through 2019, $27.8 billion went to majority-minority census tracts, creating 244,000 permanent jobs.
Cinnaire has used this tool extensively in Michigan and across our footprint to support community-led efforts like the Mott Culinary Arts Institute to create opportunities that can change the trajectory of people’s lives for generations to come. For us to continue carrying out this important work, however, it is crucial that Congress make this tool permanent.
At the close of 2020, funding for the NMTC was set to expire. Fortunately, Congress provided a five-year, $25 billion annual extension, but its future beyond this extension remains tenuous.
Meanwhile, the economic challenges brought on by the global pandemic and a broader recognition of racial inequality in our country have only heightened the urgent need to revitalize underserved communities across the country.
On February 25, 2021, a bipartisan group of key members of the Senate and House introduced bills (S.456 and H.R. 1321) to make funding for the NMTC program permanent, ensuring that much-needed resources will be available for years to come. As Congress considers potential economic recovery legislation, we encourage them to prioritize this proven tax incentive for bringing investment to communities that need it most.
Now is the time to make permanent this tool which has proven effective at tracking investment in underserved communities in Michigan and across the country.
To learn more about the NMTC and its impact, please visit the New Markets Tax Credit Coalition’s website.