NMTC Program Allocation Application (Business & Non-Profit)

85
85

Community
Development
Financial
Institutions
Fund

NMTC Program
New Markets Tax Credit
Allocation Application

2013/2014
Application

OMB Approval No. 1559-0016

Paperwork Reduction Act Notice.
This submission requirements package is provided to Applicants to apply for an allocation of New
Markets Tax Credits (NMTC) under the NMTC Program. Applicants are not required to respond to this
collection of information unless it displays a currently valid OMB control number. The estimated average
burden associated with this collection of information is 240 hours per Applicant. Comments concerning
the accuracy of this burden estimate and suggestions for reducing this burden should be directed to the
Program Manager, NMTC Program, Department of the Treasury, Community Development Financial
Institutions Fund, 1500 Pennsylvania Avenue, Washington, D.C. 20220

Table of Contents
Applicant Instructions ........................................................................... iii
Assurances and Certifications ............................................................. vi
Applicant Information ............................................................................. 1
Part I: Business Strategy ....................................................................... 9
A. Products, Services, and Investment Criteria ................................................................. 9
B. Prior Performance ...................................................................................................... 13
C. Projected Business Activities ...................................................................................... 15
D. Non-Metropolitan Counties ......................................................................................... 18
E. Investments in Unrelated Entities ............................................................................... 19

Part II: Community Outcomes .............................................................. 21
A. Targeting the Use of QLICIs ....................................................................................... 21
B. Community Development Outcomes – Prior Performance and Projections.................. 23

Part III: Management Capacity ............................................................. 28
Part IV: Capitalization Strategy ............................................................ 34
A. Investor Strategy ........................................................................................................ 34
B. Sources and Uses of Capital ....................................................................................... 37

Part V: Information Regarding Previous Awards ............................... 39
Exhibit A: Track Record of Activities .................................................. 43
Table A1: Track Record of Loans/Investments to Non-Real Estate Businesses ............... 44
Table A2: Track Record of Loans/Investments to Real Estate Businesses ...................... 45
Table A3: Track Record of Loans/Investments to Other CDEs......................................... 46
Table A4: Track Record of Loan Purchases from Other CDEs......................................... 46
Table A5: Track Record of Financing Activities that would not qualify as QLICI Activities 47

Exhibit B: Projected Activities ............................................................. 48
Table B1: Projected Loans/Investments to Non-Real Estate QALICBs (Estimated) ......... 49
Table B2: Projected Loans/Investments to Real Estate QALICBs (Estimated) ................. 49
Table B3: Projected Loans/Investments in Other CDEs (Estimated) ................................ 50
Table B4: Projected Loan Purchases from Other CDEs (Estimated) ................................ 50

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page i

Table B5: Projected Financial Counseling and Other Services to Businesses and
Entrepreneurs in Low-Income Communities (Estimated) ................................................. 51

Exhibit C: Staff and Board Qualifications ........................................... 52
Table C1: Management Capacity ..................................................................................... 52
Table C2: Low-Income Community Accountability ........................................................... 53

Exhibit D: Asset Management and Income & Operating Expenses .. 54
Table D1: Investment Portfolio ......................................................................................... 54
Table D2: Income and Operating Expenses ..................................................................... 56

Exhibit E: Investor Strategy ................................................................. 57
Table E1: Identification of Investments and Investor Commitments ................................. 58
Table E2: Track Record of Raising Capital from Investors ............................................... 58

Glossary of Terms ................................................................................ 59

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page ii

Applicant Instructions


Read the relevant New Markets Tax Credit (NMTC) Program publications prior to completing the
Allocation Application. For information on the combined calendar year (CY) 2013 and 2014
NMTC Program allocation round (this Round), read the Notice of Allocation Availability (NOAA)
and the Community Development Financial Institutions Fund’s (the CDFI Fund’s) document
titled “NMTC Allocation Application Q&A Document.” For tax related information on the NMTC
Program, read the final regulations issued by the Internal Revenue Service (26 CFR 1.45D-1)
and related guidance. For information on Community Development Entity (CDE) certification,
read the CDFI Fund’s document titled “CDE Certification Q&A Document.” All of these
documents are available on the CDFI Fund’s website at www.cdfifund.gov. The CDFI Fund’s
Q&A documents are periodically updated, so continue to check the website on a regular basis.



Consult the Glossary of Terms when completing the Allocation Application. All terms and
phrases that are in Capitalized Italics in the Allocation Application are defined in the Glossary of
Terms.



A Subsidiary CDE cannot submit an Allocation Application.

•

If the Applicant has not been certified as a CDE by the CDFI Fund, it must submit its CDE
Certification Application to the Bureau of Public Debt (BPD, the entity that is handling intake of
applications on behalf of the CDFI Fund) so that it is Postmarked on or before August 9,
2013. The CDE Certification Application is available on the CDFI Fund’s website at
www.cdfifund.gov. Organizations whose CDE Certification Applications are not received at BPD
in a timely fashion will be considered ineligible for NMTC Allocations in this Round of the
Program. An Applicant that is a Community Development Financial Institution (CDFI) or
Specialized Small Business Investment Company (SSBIC) does not need to submit a CDE
Certification Application to BPD, but must register as a CDE on the CDFI Fund’s website by
5:00 pm, Eastern Time, on August 9, 2013.

TIP: The CDFI Fund cannot process a CDE Certification Application unless each entity seeking
certification as a CDE: (a) is a legal entity, and is a domestic corporation or partnership for federal tax
purposes; and (b) has a valid and distinct Employer Identification Number (EIN). Applicants or
Subsidiary Applicants that have applied for, but not yet received, an EIN as of the date of the
Authorized Representative’s signature on the Allocation Application will not be accepted. For more
information on EINs and applying for an EIN, refer to the CDE Certification Q&A Document on the
CDFI Fund’s website at www.cdfifund.gov.

TIP: The term “Postmarked,” as used throughout this document, is defined by 26 CFR 301. 7502-1. In
general, the CDFI Fund will require a Postmarked date that is on or before the applicable deadline.
The document must be in an envelope or other appropriate wrapper, properly addressed and deposited
in the U.S. mail. The document may be delivered by the United States Postal Service or any other
private delivery service designated by the Secretary of the Treasury. For more information on
designated delivery services, please see IRS Notice 2002-62.


Carefully read the Allocation Application and the NOAA to determine whether the Applicant has
the requisite eligibility, capacity, experience, and skills to compete for and administer a NMTC
Allocation. Be sure also to review carefully the Assurances and Certifications provided in this
document. By signing this Allocation Application, the Applicant is certifying to the truth,
completeness, and correctness of this Allocation Application, including the items listed in the
Assurances and Certifications.

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page iii



If the CDFI Fund determines that any portion of the Allocation Application is incorrect in any
material respect, the CDFI Fund reserves the right, in its sole discretion, to reject the Allocation
Application.



As the Applicant prepares the Allocation Application, assume that the CDFI Fund’s Allocation
Application reviewers are learning about the organization for the first time, even if the
organization has previously submitted an application to the CDFI Fund under this or any of the
other CDFI Fund programs.



A start-up organization that does not have a track record of raising capital or offering products
and services may reference the activities of its Controlling Entity in certain areas of the
Allocation Application. However, a start-up may not reference the activities of individuals,
including principals or board members, to demonstrate such track record. The activities and
experiences of individuals may be addressed in the Management Capacity section.



The term Applicant refers to the CDE applying for a NMTC Allocation as well as any other
Subsidiary entities, whether already formed or in the process of formation, which may receive a
transfer of all or a part of a NMTC Allocation from the Applicant. To the extent practicable, the
Applicant may respond to each question in this Allocation Application collectively on behalf of all
such entities. If responses vary for separate entities, be sure to clearly articulate which entity is
being referenced in the narrative and tables.



Be sure to keep each narrative brief: Please note that each narrative text response has a
maximum character length, which, depending on font size, will range from about 1/3 of a page to
about 2 pages). These character maximums include spaces, punctuation, and special
characters. All text that exceeds the maximum set for a narrative text response (which is noted
at the end of each question) will be truncated at the character limit.

DO NOT SUBMIT THIS ALLOCATION APPLICATION


Use the online application: This version of the Allocation Application is a read-only version. Any
organization interested in applying for a NMTC Allocation from the CDFI Fund is expected to
submit an online Allocation Application. Applicants may access the online Allocation Application
as soon as it is made available by logging in through myCDFIFund on the CDFI Fund's website
at www.cdfifund.gov. Applicants who have not already done so are encouraged to register a
user account through myCDFIFund as soon as possible. Please contact the CDFI Fund's IT
Help Desk at (202) 653-0422 or [email protected] if you are having problems
registering under myCDFIFund. The online Allocation Application must be received no
later than 5:00 pm, Eastern Time, on September 18, 2013. Complete instructions regarding
the electronic submission requirements will be posted on the CDFI Fund's website at
www.cdfifund.gov when the online Allocation Application is made available.



Required Investor Letters: Applicants completing Table E1 are required to submit Commitment
letters or letters of interest from investors per the TIPs for Exhibit E. Please upload these
documents electronically through the Applicant’s myCDFIFund account. In doing so, an
Applicant is also validating the following information: name of investor, dollar amount of equity
sought or obtained (or dollar amount of debt, in the case of an investor partnership using debt
capital), status of the investment request (e.g., funds received, Commitment of funds, Letter of
Interest/Intent). If the documents do not contain such information and validate the information
entered in Table E1 or are missing altogether, the Applicant could lose points under the
Capitalization Strategy section. For examples of acceptable documentation for the required
information, refer to the CDFI Fund’s NMTC Allocation Application Q&A Document.



Submitting Signature Pages and Required Documents: All Applicants will be required to upload
signature pages and other documents (Letters of Interest/Intent, Commitment letters and
organizational charts) electronically through their myCDFIFund accounts. An Applicant will be

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page iv

instructed on how to upload the aforementioned signature page and other documents (i.e.,
attachments) at the time the Applicant submits its Allocation Application. All attachments must
be uploaded by 11:59 pm, Eastern Time, on September 20, 2013. If the attachments are not
received by the applicable deadline, they will not be given consideration as part of the review
process. Only those attachments requested by the CDFI Fund will be considered as part
of the review process. Furthermore, the CDFI Fund will not accept any revisions or
amendments to an application or the attachments once they have been submitted for
review.


Part V - Information Regarding Previous Awards: All Applicants are required to complete Part V
of the Allocation Application. Applicants who have not received previous NMTC Allocations or
who have not received other CDFI Fund Awards (i.e. FA-TA, CMF, BEA) will simply need to
respond “No” to Questions 42 and 43 and not respond to Question 44. Applicants who have not
made QEIs into previous Allocatees or assumed Control of previous Allocatees should respond
“No” to Question 45. Please note that Part V is not specifically scored as part of the Phase I
review process, and is only considered if the Applicant is ranked highly enough to proceed to
Phase II of the application review process.



Each Applicant should expect that if it receives a NMTC Allocation, information provided in this
Allocation Application will be used to determine the terms of an Allocation Agreement.



The contents of this Allocation Application are consistent with the Internal Revenue Code
Section 45D (the Code) and the NMTC Program Income Tax Regulations. In the event of any
inconsistency between the contents of this Allocation Application and the Code or the NMTC
Program Income Tax Regulations, the provisions of the Code and the NMTC Program Income
Tax Regulations shall govern.

TIP: If you have programmatic questions about the contents of this Allocation Application, you may
contact the CDFI Fund by mail at Program Manager, NMTC Program, Department of the Treasury,
Community Development Financial Institutions Fund, 1500 Pennsylvania Avenue, Washington, D.C.
20220, by e-mail at [email protected], by telephone at (202) 653-0421, by facsimile at (202) 5080084, or visit the CDFI Fund’s website at www.cdfifund.gov. If you require information technology
assistance in using the online Allocation Application, please call (202) 653-0422 or e-mail
[email protected].
The CDFI Fund will provide programmatic and information technology support related to the Allocation
Application between 9:00 am and 5:00 pm, Eastern Time, through Monday, September 16, 2013. The
CDFI Fund will not respond to phone calls or e-mails concerning the Allocation Application that
are received after 5:00 pm, Eastern Time, on Monday, September 16, 2013, until after the
Allocation Application deadline of September 18, 2013.

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page v

Assurances and Certifications
Except for paragraphs 10, 11, 12, 13, and 15 below, the inability of the Applicant to provide the General
Certifications (section A, below) will render the Applicant ineligible to apply for a NMTC Allocation. If the
Applicant cannot provide the General Certifications in paragraphs 10, 11, 12, 13, and 15 the Applicant
must submit a written explanation. The CDFI Fund will consider the explanation provided and determine,
in its sole discretion, whether the Applicant is eligible to apply for a NMTC Allocation. If the Applicant
cannot provide any of the other General Certifications, it should not submit an Allocation Application.
The inability of the Applicant to provide the Certification Regarding Debarment, Suspension, and Other
Responsibility Matters (section B, below) will not necessarily result in the denial of participation in this
“covered transaction.” The Applicant must submit an explanation of why it cannot provide one or more of
the statements in the Certification Regarding Debarment, Suspension, and Other Responsibility Matters
of Section C. The Certification or explanation will be considered in connection with the CDFI Fund’s
determination whether to enter into this transaction (meaning, approval of the Allocation Application and
entering into an Allocation Agreement). However, failure of the Applicant to furnish either the Certification
or an explanation will disqualify the Applicant from participation in said transaction.
A. General Certifications
As the Authorized Representative of the Applicant, I hereby assure and certify that:
1.

The Applicant is duly organized and validly existing under the laws of the jurisdiction in which it
was incorporated or otherwise established.

2.

The Applicant has the legal authority to apply for a NMTC Allocation, and the institutional,
managerial, and financial capability to ensure proper use of such allocation as described in this
Allocation Application and in accordance with IRC §45D and the NMTC Program Income Tax
Regulations, and all applicable Department of the Treasury regulations and guidance documents.

3.

The Applicant’s governing body (e.g., Board of Directors) has by proper resolution or similar action
authorized the signing and filing of this Allocation Application, including all understandings and
assurances contained herein, and directed and authorized me as the Authorized Representative of
the Applicant to act in connection with this Allocation Application and to provide such additional
information as may be required.

4.

The Applicant will give the Department of the Treasury, the Comptroller General of the United
States, and if appropriate, the State of the Applicant’s incorporation, through any Authorized
Representative, access to and the right to examine all records, books, papers, or documents
related to the provision of a NMTC Allocation; and will establish a proper accounting system in
accordance with generally accepted accounting standards; Office of Management and Budget
(OMB) regulations, guidelines, and circulars; and Department of the Treasury regulations and
directives.

5.

The Applicant will establish safeguards to prohibit employees from using their positions for
purposes that constitute or present personal or organizational conflicts of interest, or personal gain,
either real or perceived.

6.

The Applicant will comply with all applicable requirements of Title I, subtitle C, section 121 of the
Community Renewal Tax Relief Act of 2000, as enacted by section 1(a)(7) of the Consolidated
Appropriations Act, 2001 (Public Law No. 106-554, December 21, 2000), and as amended,
regulations implementing the NMTC Program and all other applicable Department of the Treasury
regulations, guidance, and implementing procedures (and any regulations or procedures which are
later promulgated to supplement or replace them).

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page vi

7.

The Applicant will comply, as applicable and appropriate, with the requirements of OMB Circulars
and any regulations and circulars which are later promulgated to supplement or replace them,
including standards for fund control and accountability.

8.

The Applicant will comply with all applicable requirements of all other Federal laws, executive
orders, regulations, and policies governing the NMTC Program.

9.

The Applicant has not knowingly and willfully made or used a document or writing containing any
false, fictitious, or fraudulent statement or entry as part of this Allocation Application or any related
document, correspondence, or communication. The Applicant and its Authorized Representative
are aware that, under 18 U.S.C. 1001, whoever knowingly and willfully makes or uses such
document or writing shall be fined or imprisoned for not more than five years, or both.

10.

The Applicant and its officers, directors, owners, partners, and key employees: (a) have not within
a three-year period preceding the date of this Allocation Application been convicted of or had a civil
judgment rendered against them for commission of fraud or a criminal offense; (b) have not within
a three-year period preceding the date of this Allocation Application been convicted of or had a civil
judgment rendered against them for violation of Federal or State antitrust statutes or commission of
embezzlement, theft, forgery, bribery, falsification or destruction of records, making false
statements, or receiving stolen property; or (c) have not within the three-year period preceding the
date of this Allocation Application been found liable in any civil legal action involving creditor’s
claims of greater than $500,000.

11.

The Applicant and its officers, directors, owners, partners, and key employees: (a) have not within
a three-year period preceding the date of this Allocation Application been indicted for or charged
with the commission of fraud or a criminal offense; (b) have not within a three-year period
preceding the date of this Allocation Application been indicted for or charged with the violation of
Federal or State antitrust statutes or commission of embezzlement, theft, forgery, bribery,
falsification or destruction of records, making false statements, or receiving stolen property; (c) are
not presently indicted for or otherwise criminally or civilly charged by a governmental entity
(Federal, State, or local) with commission of any of the offenses enumerated in paragraphs 11(a)
and 11(b) of this certification; or (d) have not within the three-year period preceding the date of this
Allocation Application been the subject of any formal investigation or disciplinary proceeding by a
government agency, regulatory body, or professional association in connection with any matter
which may have a material adverse effect on the Applicant or its financial condition or the
Applicant’s ability to carry out the authorized uses of a NMTC Allocation.

12.

Any other person or entity that Controls the Applicant (other than the Applicant’s officers, directors,
owners, partners, and key employees): (a) has not within a three-year period preceding the date of
this Allocation Application been indicted, charged with or convicted of, or had a civil judgment
rendered against it for commission of fraud or a criminal offense; (b) has not within a three-year
period preceding the date of this Allocation Application been indicted, charged with or convicted of,
or had a civil judgment rendered against it for violation of Federal or State antitrust statutes or
commission of embezzlement, theft, forgery, bribery, falsification or destruction of records, making
false statements, or receiving stolen property; (c) is not presently indicted for or otherwise
criminally or civilly charged by a governmental entity (Federal, State, or local) with commission of
any of the offenses enumerated in paragraphs 12(a) and 12(b) of this certification; (d) has not
within the three-year period preceding the date of this Allocation Application been the subject of
any formal investigation or disciplinary proceeding by a government agency, regulatory body, or
professional association in connection with any matter which may have a material adverse effect
on the Applicant or its financial condition or the Applicant’s ability to carry out the authorized uses
of a NMTC Allocation; or (e) has not within the three-year period preceding the date of this
Allocation Application been found liable in any civil legal action involving creditor’s claims of
greater than $500,000.

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page vii

13.

The Applicant has never been delinquent on amounts due to the Internal Revenue Service or on
any debts owed to Federal, State, or local government.

14.

The Applicant has never filed for bankruptcy.

15.

Neither the Applicant, Controlling Entity (if applicable), nor any Affiliate is a federally regulated
financial institution currently under any Enforcement Action from any federal regulator.

NOTE: Where the Applicant is unable to certify to one or more of the statements in paragraphs 10, 11,
12, 13 or 15 of the General Certifications, the Applicant must attach a written explanation to this
Allocation Application, clearly identifying which paragraph number(s) and corresponding statement(s) it is
unable to certify.
___ Insert the paragraph number(s) containing the statement(s) for which the Applicant is unable to
certify.
B. Certification Regarding Debarment, Suspension, and Other Responsibility Matters — Primary
Covered Transactions
1.

This Certification is a material representation of fact upon which reliance is placed when the CDFI
Fund enters into an Allocation Agreement with the Applicant. If it is later determined that the
Applicant knowingly rendered an erroneous or false Certification, the CDFI Fund may terminate, in
its sole discretion, the Notice of Allocation and the Allocation Agreement for cause or default.

2.

The Applicant must provide immediate written notice to the CDFI Fund if at any time the Applicant
learns that this Certification was erroneous or false when submitted or has become erroneous or
false by reason of changed circumstances.

3.

The terms “covered transactions,” “debarred,” “suspended,” “ineligible,” “lower tier covered
transaction,” “participant,” “person,” “primary covered transaction,” “principal,” “proposal,” and
“voluntarily excluded,” as used in this Certification, have the meanings set out in the Definitions
and Coverage sections of the rules implementing Executive Order 12549. The Applicant may
contact the CDFI Fund for assistance in obtaining a copy of those regulations (31 CFR part 19).

4.

The Applicant agrees that, by submitting this Allocation Application, should the proposed covered
transaction be entered into, it shall not knowingly enter into any lower tier covered transaction with
a person who is proposed for debarment under 48 CFR part 9, subpart 9.4, debarred, suspended,
declared ineligible, or voluntarily excluded from participation in this covered transaction, unless
authorized by the CDFI Fund.

5.

The Applicant further agrees that, by submitting this Allocation Application, it will include the
Certification titled “Certification Regarding Debarment, Suspension, Ineligibility, and Voluntary
Exclusion-Lower Tier Covered Transaction,” to be provided by the CDFI Fund, without
modification, in all lower tier covered transactions and in all solicitations for lower tier covered
transactions (see 31 CFR part 19, Appendix B).

6.

A participant in a covered transaction may rely upon a certification of a prospective participant in a
lower tier covered transaction that it is not proposed for debarment under 48 CFR part 9, subpart
9.4, debarred, suspended, ineligible, or voluntarily excluded from the covered transaction, unless it
knows that the certification is erroneous or false. A participant may decide the method and
frequency by which it determines the eligibility of its principals. Each participant may, but is not
required to, check the List of Parties Excluded from Federal Procurement and Non-procurement
Programs. See www.epls.gov for more information.

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page viii

7.

Nothing contained in the foregoing shall be construed to require establishment of a system of
records in order to render in good faith the Certification hereby required. The knowledge and
information of a participant is not required to exceed that which is normally possessed by a prudent
person in the ordinary course of business dealings.

8.

Except for transactions authorized under paragraph 4 above, if a participant in a covered
transaction knowingly enters into a lower tier covered transaction with a person who is proposed
for debarment under 48 CFR part 9, subpart 9.4, suspended, debarred, ineligible, or voluntarily
excluded from participation in this transaction, in addition to other remedies available to the
Federal Government, the CDFI Fund may terminate, in its sole discretion, the Notice of Allocation
and the Allocation Agreement for cause or default.

C. Certification Regarding Debarment, Suspension, and Other Responsibility Matters – Primary
Covered Transactions
The prospective primary participant (the Applicant) certifies to the best of its knowledge and belief,
that it and its principals:
1.

are not presently debarred, suspended, proposed for debarment, declared ineligible, or voluntarily
excluded from covered transactions by any Federal department or agency;

2.

have not within a three-year period preceding this Allocation Application been convicted of or had a
civil judgment rendered against them for: (i) commission of fraud or a criminal offense in
connection with obtaining, attempting to obtain, or performing a public (Federal, State, or local)
transaction or contract under a public transaction; or (ii) violation of Federal or State antitrust
statutes or commission of embezzlement, theft, forgery, bribery, falsification or destruction of
records, making false statements, or receiving stolen property;

3.

are not presently indicted for or otherwise criminally or civilly charged by a governmental entity
(Federal, State, or local) with commission of any of the offenses enumerated in paragraph (1)(b) of
this certification; and

4.

have not within a three-year period preceding this Allocation Application had one or more public
transactions (Federal, State, or local) terminated for cause or default.

NOTE: Where the Applicant is unable to certify to one or more of the statements in Section C
Certification Regarding Debarment, Suspension, and Other Responsibility Matters – Primary Covered
Transactions, the Applicant must attach a written explanation to this Allocation Application, clearly
identifying which numbered statement(s) it is unable to certify.
___ Insert the paragraph number(s) containing the statement(s) for which the Applicant is unable to
certify.

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page ix

Applicant Information
1. Applicant NMTC Allocation Request
Total dollar amount of NMTC Allocation requested in this Allocation Application:
$__________
2. Applicant Information:1
(a) Applicant Name:
(b) Applicant Employer Identification Number:

(c) Structure of the Applicant (check all that apply):
___ For-profit

___ Credit Union

___ Non-profit

___ Publicly Traded Company

___ Small Business Investment
Company/Specialized Small Business
Investment Company

___ Government-Controlled Entity
___ Faith-Based Institution
___ Tribal Entity

___ New Market Venture Capital Company

___ Thrift, Bank or Bank Holding Company

___ Certified CDFI

___ Real Estate Development Company
___ Series of Funds

(d) Is the Applicant Minority-owned or Minority-controlled? ____ Yes _____ No
(e) If the Applicant is a federally-regulated thrift, bank, bank holding company, or credit
union, provide the name of the Applicant’s primary federal regulator and FDIC/NCUA
Certification Number.
Name of Primary Regulator: _________________
Certification Number: _________________
(f) Is the Applicant a domestic corporation or partnership for federal tax purposes?
(If the Applicant is not a domestic corporation or partnership for federal tax purposes, it
is not eligible to apply for a NMTC Allocation):
____ Domestic Corporation
____ Domestic Partnership
(g) Applicant’s date of incorporation or formation (month/day/year): _______________
1

For the purposes of Questions #2-6 in this Applicant Information section, the term Applicant shall only apply to the
entity applying for a NMTC Allocation, and not to Subsidiary entities that may receive a transfer of all or part of a NMTC
Allocation.

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 1

(h) Applicant’s total assets as of the date of this Allocation Application: $_________
(i) Applicant’s fiscal year end (month/day): ________
(j) Does the Applicant have any Affiliates that are applying for a NMTC Allocation in this
Round? (check one): ___ Yes ___ No
TIP: The answer to question 2(j) must be “No.” An Applicant and its Affiliates may collectively submit
only one application for a NMTC Allocation under this Round of the NMTC Program. If separate
applications are received from multiple Affiliated entities, the CDFI Fund reserves the right to reject all
such applications. Likewise, Subsidiary CDEs are ineligible to submit an Allocation Application. For the
purposes of this requirement, in addition to assessing whether Applicants meet the definition of the
term “Affiliate” found in the Allocation Application, the CDFI Fund will consider: (i) whether the activities
described in applications submitted by separate entities are, or will be, operated or managed as a
common enterprise that, in fact or effect, could be viewed as a single entity; and (ii) whether the
business strategies and/or activities described in applications submitted by separate entities are so
closely related that, in fact or effect, they could be viewed as substantially identical applications. In
such cases, the CDFI Fund reserves the right either to reject all applications received from all such
entities or to select a single application as the only one that will be considered for an allocation. For
more information regarding these requirements, please review the NOAA or Allocation Application
Q&A Document on the CDFI Fund’s website at www.cdfifund.gov. If you have questions about whether
two entities are Affiliated, you should contact the CDFI Fund well in advance of the NMTC Allocation
Application due date.

3. Controlling Entity Information:
Is the Applicant designating a Controlling Entity? ____ Yes _____ No
TIP: An Applicant may only designate an organization as a Controlling Entity that meets the definition of
Controlling Entity set forth in the Glossary of Terms. Individuals cannot be deemed to be Controlling
Entities. The Allocation Application does not allow for more than one Controlling Entity.
Therefore, entities with more than one Controlling Entity will need to select one Controlling Entity to list
in the application to assist in demonstrating a track record and in completing the related exhibits. An
Applicant may identify the parent organization/company of its parent as its Controlling Entity to
demonstrate an organizational track record, provided that the relationship between the “grandparent”
and the Applicant conforms to the CDFI Fund’s definition of a Controlling Entity. Should the Applicant
receive a NMTC Allocation, the entity that is designated as the Controlling Entity below will need to
continue in that capacity throughout the term of the Allocation Agreement with the CDFI Fund.
TIP: The Controlling Entity Representative is required to affirm, through submission of a signature
page, that it is indeed the Controlling Entity of the Applicant and supports the Applicant’s Allocation
Application.

(a) Controlling Entity Name:
(b) Controlling Entity Employer Identification Number:

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 2

(c) Structure of the Controlling Entity (check all that apply):
___ For-profit

___ Credit Union

___ Non-profit

___ Publicly Traded Company

___ Small Business Investment
Company/Specialized Small Business
Investment Company

___ Government-Controlled Entity
___ Faith-Based Institution
___ Tribal Entity

___ New Market Venture Capital Company

___ Thrift, Bank or Bank Holding Company

___ Certified CDFI

___ Real Estate Development Company
___ Series of Funds

(d) Is the Controlling Entity Minority-owned or Minority-controlled? _____ Yes _____ No
(e) If the Controlling Entity or an Affiliate is a federally-regulated thrift, bank, bank holding
company, or credit union, provide the name of the Controlling Entity’s or Affiliate’s
primary federal regulator and FDIC/NCUA Certification Number.
Name of Primary Regulator: _______________
Certification Number: _______________
(f) Total assets of Controlling Entity:

$ ________________

4. Applicant Mailing Information:
Mailing address (provide nine-digit zip code):

Address for overnight deliveries (if different from mailing address, include 9-digit zip
code):

TIP: Representatives of the Applicant and Controlling Entity (if applicable), should not provide private,
personal contact information in response to Question #5. Only official, public contact information
should be provided.

5. Applicant and Controlling Entity Contact Information
(a) Applicant Authorized Representative Information:
Name, title, and mailing address, if different from Applicant:

Telephone number:

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Fax number:

Page 3

E-mail address:

(b) Controlling Entity Representative Information:
Name, title, and mailing address:

Telephone number:

Fax number:

E-mail address:
(c) Application Contact Person Information:
Name, title, and mailing address, if different from Applicant:

Telephone number:

Fax number:

E-mail address:
TIP: In Question #5(c), the Applicant should provide contact information for the individual who the CDFI
Fund should contact with questions related to the Applicant’s NMTC Allocation Application. It is
recommended that the Application Contact Person listed is someone other than the Applicant
Authorized Representative.

(d) Public Contact Person Information:
Name, title, and mailing address, if different from Applicant:

Telephone number:

Fax number:

E-mail address:
TIP: If the Applicant should receive an NMTC Allocation, the contact information listed in response to
Question #5(d) will be released to the public as part of the CDFI Fund’s Award Announcement and
included in other reports made available to the public.

6. CDE Certification Information:
(a) Has the Applicant already been certified as a CDE by the CDFI Fund or submitted a
CDE Certification Application?

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 4

___ Yes, CDE Certification Control Number: _____________________________
___ No
Subsidiary CDEs are ineligible to submit Allocation Applications.
(b) By the stated deadline in the NOAA, is the Applicant filing a service area
amendment in connection with this application?
____ Yes

____ No

TIP: An Applicant’s CDE Certification Application must be sent to the Bureau of Public Debt (the entity
that is handling intake of applications on behalf of the CDFI Fund), Postmarked no later than August 9,
2013 to be considered for a NMTC Allocation in this Round. The CDE Certification Application is
available on the CDFI Fund’s website at www.cdfifund.gov. The CDFI Fund cannot process a CDE
Certification Application unless each entity seeking certification as a CDE: a) is a legal entity and is a
domestic corporation or partnership for federal tax purposes; and b) has a valid and distinct EIN. An
Applicant that is a CDFI or SSBIC does not need to submit a CDE Certification Application, but must
register as a CDE on the CDFI Fund’s website on or before 5:00 pm, Eastern Time, on August 9,
2013. CDE service area amendment requests will not be considered for purposes of this
application unless filed by the deadline stated in the Round NOAA.

7.

Identify the type of service area that the Applicant will serve (check one). The service area
identified here must be identical to the service area identified by the Applicant in its CDE
Certification Application approved by the CDFI Fund:
National service area
Multi-state service area
Statewide (or territory-wide) service area
Local service area (e.g., neighborhoods, cities, a county or contiguous
counties, or metropolitan areas) within a state or territory

TIP: An Applicant serving a metropolitan area that crosses multiple states (e.g., the Washington, D.C.
or Philadelphia metropolitan areas) should check “Multi-state service area.”
TIP: If an Applicant would like to focus its investments in this Allocation Application on a subset of its
certified service area, it may discuss this in the narrative response to Question #19. However, all
Applicants must designate their entire certified service area (or if applicable, the entire service area for
which certification or a service area amendment is pending) in response to Questions #7 and #8.

8.

Identify the particular geographical areas that the Applicant will serve. An Applicant that is
serving a national service area must identify at least one state and may identify up to six
additional states with the largest amount of projected activities:
State(s):
County(ies):

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 5

9.

Estimate the percentage of activities, by dollar amount that will be directed to each of the
following markets. The total percentage should add up to 100 percent of the NMTC
Allocation amount.
% Major urban areas (Counties in metropolitan area with a population
equal to or greater than 1 million, including both central city and
surrounding suburbs)
% Minor urban areas (Counties in metropolitan area with a population less
than 1 million, including both central city and surrounding suburbs)
% Non-metropolitan Counties

10. Please indicate the Applicant’s predominant anticipated financing activity (check only one):
____ Non-Real Estate QALICB financing
____ Real Estate QALICB financing: (check only one accompanying sub-category)
____ Retail
____ Office Space
____ Industrial/Manufacturing
____ For-sale housing
____ Community Facilities
____ Mixed-use (housing, commercial, or retail)
____ Other Real Estate Financing: _________________
____ Financing of other CDEs
____ Loan purchase from other CDEs
____ Financial Counseling and Other Services

11. Executive Summary:
(a) Provide a summary of the Applicant’s business strategy including the following:
(Maximum Response Length: 5,000 characters)
 A brief summary of the Applicant’s service area, including the specific needs or
problems that it intends to address with NMTCs.
 A brief summary of the types of projects and/or borrowers the Applicant will target
and address why NMTCs are important for the identified projects and/or borrowers.
 A brief summary of the products that the Applicant will offer, including both financial
products and technical assistance.
 A brief summary of how the NMTCs will enhance the Applicant’s product offerings.

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 6

TIP: Note that Question #11(a) is meant to be a brief summary of the Applicant’s overall business
strategy, thus it is not necessary to provide a detailed discussion of items that will be specifically
covered in detail in other parts of the Business Strategy section.

(b) Provide a one or two sentence description of the types of investments the Applicant
intends to make with the requested NMTC Allocation. Applicants will not be scored
on this response. The information provided will be used as part of the CDFI Fund’s
public award announcement. (Maximum Response Length: 500 Characters)

Sample:
XYZ CDE (XYZ) will use its NMTC Allocation to invest in commercial real estate and operating
businesses that revitalize vacant properties and create living wage jobs in Low-Income Communities
that have experienced persistently high unemployment. The CDE intends to offer equity equivalent
terms and conditions and senior debt.

NOTE:
The CDFI Fund will supplement the information from Question #11(b) with responses to certain
questions contained in the Allocation Application. Such profiles will be shared with the general public
via the CDFI Fund’s website or other public materials/forums. For more on what information will be
contained in this profile, please see the Application Q&A document.

12. Estimate how long this Allocation Application form took to complete: ________ hours
TIP: For the purpose of estimating hours, Applicants should focus only on the amount of time it took to
complete the questions asked in this application. Other activities that are carried out in the normal
course of business and are only indirectly related to the completion of this application (e.g., securing
investor Commitments; developing a business strategy or marketing plan; etc.) should not be included
in this estimation. In the electronic on-line application form, you will not be able to answer this
question until all other application questions are complete.

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 7

By signing this Allocation Application, the Applicant makes the Assurances and Certifications, set
forth in the Assurances and Certifications (pages vi-ix) of the Allocation Application, which
Assurances and Certifications are made a part hereof and will continue in effect until the Applicant
enters into an Allocation Agreement with the CDFI Fund.
I hereby certify that all of the information that the Applicant has provided in this Allocation
Application and in the Assurances and Certifications in support of this Allocation Application is
true, correct, and complete. The execution and submission of this Allocation Application has been
duly authorized by the governing body of the Applicant.
Applicant Name:
Authorized Representative Signature:
Name (print)

Title

Date:

By signing this Allocation Application, the Controlling Entity certifies that it is indeed the
Controlling Entity of the Applicant and supports this Allocation Application.
Controlling Entity Name:
Controlling Entity Representative
Signature:
Name (print)

Title

Date:

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 8

Part I: Business Strategy
Total Maximum Points for Part I: 25 points, plus up to 10 additional “priority points” available
under sub-sections B and E.
TIP: An Applicant will score well in this section to the extent it can articulate, with specificity, its strategy
to use a NMTC Allocation and can describe a strong, relevant track record, including a track record of
serving Low-Income Communities. Included in this section is the ability to earn “priority points” for
meeting the statutory priorities of: 1) investing in Unrelated entities; and/or 2) demonstrating a track
record of serving Disadvantaged Businesses or Communities. Refer to the NOAA for further
information on the statutory priorities.

A. Products, Services, and Investment Criteria
TIP: For the purposes of completing the Business Strategy section and all relevant exhibits, financing
provided to Real Estate QALICBs refers to entities whose predominant business activity (i.e. activity
that generates more than 50 percent of the business’ gross income) includes the development
(including construction of new facilities and rehabilitation/enhancement of existing facilities),
management, or leasing of real estate.
Transactions with businesses whose predominant business activity includes all other types of business
activities should be classified as Non-Real Estate QALICBs regardless of: 1) how the business intends
to use the proceeds of the transaction; or 2) whether the business intends to use any real estate owned
as collateral for a loan.
Notwithstanding the above, loans or investments made to a special purpose entity that is Controlled by
or under common Control with an Non-Real Estate QALICB (whose predominant business activity does
not include development (construction of new facilities and rehabilitation/enhancement of existing
facilities), management, or leasing of real estate, and that was set up specifically to lease the property
back to the Non-Real Estate QALICB such that the Non-Real Estate QALICB is the principal user of the
property, must be classified as a Real Estate QALICB.

TIP: An Applicant will score well under the Products, Services, and Investment Criteria sub-section to
the extent that it will deploy debt or equity capital, or offer products and services which: 1) are designed
to meet the needs of underserved markets; 2) are flexible or non-traditional in form; and 3) focus on
customers or partners that typically lack access to conventional sources of capital.

13. Please indicate the types of Qualified Low-Income Community Investments (QLICIs) in which
the Applicant intends to engage (check all that apply), and what percentage of allocations (by
dollar amount) will be used for each activity. (Percentages for (a)-(e) should add up to 100
percent):
(a) __ %

Investments in, or loans to, Non-Real Estate QALICBs.
Loans/investments will be used to support: (these two percentages should
add up to 100 percent by dollar amount)
____%

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Business operations (including working capital, inventory or
equipment purchase).

Page 9

____%

(b) ___ %

Real estate development (including construction of new
facilities and rehabilitation/enhancement of existing facilities)
or acquisition of real estate to be used in operating the
business.

Investments in, or loans to, Real Estate QALICBs.
Loans/investments will be used to support: (these two percentages should
add up to 100 percent by dollar amount).

(c) ___ %

____%

Special Purpose Entities that are Controlled by or under
common Control with a Non-Real Estate QALICB, and that
were set up specifically to lease the property back to the
Non-Real Estate QALICB such that the Non-Real Estate
QALICB is the principal user of the property.

____%

Other Real Estate QALICBs.

Investments in, or loans to, other CDEs.
Please indicate the percentage of each activity (by dollar amount) in which
the final recipient CDEs intend to engage, using the proceeds of the NMTC
investments provided by the Applicant. Percentages should add up to 100
percent.
% Origination of loans, investment of capital, or equity to NonReal Estate QALICBs
% Origination of loans, investment of capital, or equity to Real
Estate QALICBs
% Financial Counseling and Other Services

(d) ___ %

Purchases of loans from other CDEs.

(e) ___ %

Financial Counseling and Other Services.
In conjunction with financing (check, if applicable)
As a discrete line of business (check, if applicable)

14. Products, rates and terms that the Applicant intends to offer:
TIP: If an Applicant intends to utilize its requested NMTC Allocation to engage solely in either the
purchase of loans from other CDEs or in the provision of Financial Counseling and Other Services, and
not in the origination of loans or equity, it should skip Questions #14 and #15.

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 10

(a) Select the products the Applicant intends to offer (check all that apply):
I.

_____

Equity Investments

II.

_____

Equity Equivalent terms and conditions, including debt with
equity features (e.g., debt with royalties; debt with warrants;
convertible debt)

III.

_____

Senior debt

IV.

_____

Subordinated debt

TIP: For each item checked in Question #14(a), the Applicant should provide a distinct and unique
narrative description. Applicants that use the same narrative text for each item checked will not be
scored as favorably. To the extent the Applicant indicates a range of offerings within an item listed
above (e.g., interest rates from 100 bps to 500 bps below market), it should describe what
circumstances would dictate the specific rates or terms, and how often the best rates and terms would
be offered.

(b) For each major product line checked above, describe which of the following flexible
or non-traditional features the Applicant intends to offer. Include a brief description of
the rates and/or terms that will be offered and explain how these rates and terms
compare with what is typically offered by the Applicant and typically offered in the
marketplace. Also, provide an example of how the product will be used (alone or in
conjunction with non-NMTC sources of financing) for each product line checked in
Question #14(a) above. (Maximum Response Length: 5,000 characters):










Below market interest rates (or rate of return in the case of equity investments)
Lower than standard origination fees
Longer than standard period of interest-only loan payments
Higher than standard loan-to-value ratio
Longer than standard amortization period
More flexible borrower credit standards
Non-traditional forms of collateral
Lower than standard debt service coverage ratio
Subordination

(c) For an Applicant that indicated under Question #13(c) that it intends to finance
other CDEs, describe the strategy by which the Applicant will ensure that those
CDEs will pass along the NMTC benefits to their QALICB borrowers in the form of
more favorable rates or terms. (Maximum Response Length: 2,000 characters)

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 11

15. Choose one of the following options. (check only one)
The Applicant will commit that 100 percent of its QLICIs will:
___ (a) be provided in the form of equity; equity-equivalent financing; debt with Interest
Rates at least 50 percent below market; or debt that otherwise satisfies at least
5 indicia of flexible or non-traditional rates and terms, as listed in Question 14.
___ (b) be provided in the form of equity; equity-equivalent financing; debt with Interest
Rates at least 33 percent below market; or debt that otherwise satisfies at least
4 indicia of flexible or non-traditional rates and terms, as listed in Question 14.
___ (c) be provided in the form of equity; equity-equivalent financing; debt with Interest
Rates at least 25 percent below market; or debt that otherwise satisfies at least
3 indicia of flexible or non-traditional rates and terms, as listed in Question 14.
___ (d) be provided in the form of equity; equity-equivalent financing; debt with Interest
Rates at least 15 percent below market; or debt that otherwise satisfies at least
2 indicia of flexible or non-traditional rates and terms, as listed in Question 14.
___ (e) None of the above.
TIP: Applicants will score better to the extent they commit to provide equity or equity-equivalent
financing; greater interest rate reductions on their debt; and/or a higher number of flexible/nontraditional rates and terms. An Applicant that checks one of the options a-d in Question #15
above should be aware that this Commitment will be a condition of its Allocation Agreement
with the CDFI Fund.
Please refer to the Application Q&A document for guidance on how to calculate below market interest
rates.

16. For an Applicant that indicated under Question #13(d) above that it plans to purchase
qualifying loans from other CDEs:
(a) Will the Applicant require the CDE from which it purchases loans to reinvest all or a
portion of the proceeds from the loan sales in QLICIs?
___ Yes ___ No
If yes, identify the percentage: _____%; and briefly describe the Applicant’s
mechanisms for enforcing this requirement:
(Maximum Response Length: 2,000 characters)

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 12

TIP: An Applicant purchasing loans from other CDEs generally will not score favorably in the Business
Strategy section unless it indicates, in Question #16(a), that it will require the CDE from which it
purchases loans to reinvest at least 85 percent of the proceeds from the loan sales in QLICIs. The
higher the percentage identified in Question #16(a), the better the Applicant will score under the
Business Strategy section. However, if the Applicant receives a NMTC Allocation, it will be
required to meet the percentage identified above, and such requirement will be a term of its
Allocation Agreement.

(b) Describe the extent to which the Applicant intends to purchase loans that include
rates, terms and/or with conditions that would not be possible without the benefit of a
NMTC Allocation. (Maximum Response Length: 2,000 characters)

B. Prior Performance
TIP: An Applicant that can demonstrate (either on its own or through a Controlling Entity) a strong,
successful track record of providing products, services, or FCOS similar to those that it intends to
deploy with Qualified Equity Investment (QEI) proceeds will score well under this sub-section. Only the
organizational track record of the Applicant or the Controlling Entity may be referenced. The track
record of the Controlling Entity may include the activities of any subsidiaries of the Controlling Entity,
including the Applicant. The track records of principals, board members and other management
individuals are not relevant for this sub-section. There will be an opportunity to discuss individual
qualifications in the Management Capacity section of this application.

17. Does the Applicant, or its Controlling Entity, have a track record of financing or otherwise
facilitating the types of QLICI activities checked in Question #13?
____ Yes (complete Questions #17(a) and (b)

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

____ No

Page 13

TIP: The NMTC Program legislation requires the CDFI Fund to give priority in the selection of
Applicants to any Applicant that has a track record of successfully providing capital or technical
assistance to Disadvantaged Businesses or Communities. An Applicant may receive up to five “priority
points” for demonstrating such a track record. An Applicant’s responses to Questions #17 and #18 will
be the determining factor in this rating. Only the organizational track record of the Applicant or the
Controlling Entity may be referenced. Do not refer to the track record of individuals (e.g., staff,
principals, consultants) associated with the Applicant or its Controlling Entity.
TIP: The Applicant may reference, in the Tables in Exhibit A and in the narrative in Question #17(b),
loans or Equity Investments that the Applicant (or its Controlling Entity) has itself originated and for
which it has capital at risk (direct financing). The track record of the Applicant can be included in the
track record of the Controlling Entity if the Applicant is a Subsidiary of the Controlling Entity.
TIP: An Applicant that has a longer track record of providing similar direct financing will generally score
higher in this section than an Applicant that primarily or exclusively provided indirect financing.
TIP: If an Applicant intends to utilize its NMTC Allocation to engage in the provision of FCOS as a
discrete line of business, and not in the purchase or origination of loans or Equity Investments, it need
not complete Tables A1-A4. It must include, however, in its narrative response below to Question
#17(b), the number of businesses/entrepreneurs to which the Applicant has provided counseling or
other services in the last five years.

(a) Complete Tables A1-A4, as applicable for the types of QLICI activities in which the
Applicant or its Controlling Entity has engaged.
(b) Provide a narrative discussion of the organization’s track record for each type of
QLICI activity identified (including FCOS), referencing data included in Tables A1-A4,
as appropriate. Focus the discussion specifically on the Applicant’s or its Controlling
Entity’s experience targeting Disadvantaged Businesses and Communities.
(Maximum Response Length: 10,000 characters)
 Be as specific as possible with respect to which activities were undertaken by the
Applicant, as opposed to its Controlling Entity (including any Subsidiaries).


Be sure to discuss whether the data in Exhibit A refers to the Applicant’s or
Controlling Entity’s (including any Subsidiaries) direct financing (i.e., its own
capital at risk) versus indirect financing (e.g., loan packaging, project
development, etc.).

 Be sure to indicate how long the Applicant or its Controlling Entity has been
serving Disadvantaged Businesses and Communities.

18. Track Record of Direct Financing Activities that would not qualify as QLICI Activities
(a) Complete Table A5, if applicable. Does the Applicant, or Controlling Entity, have a
track record of successfully providing financial products and services that would not

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 14

qualify as QLICI activities (e.g., financing residential rental housing) but are similar to
the proposed NMTC activities?
____ Yes

____ No

(b) Referencing Table A5 as appropriate, describe the Applicant’s, or Controlling
Entity’s, track record, over the past five years of successfully providing financial
products and services that would not qualify as QLICI activities and how these
activities relate to the proposed NMTC activities:
(Maximum Response Length: 5,000 characters)

C. Projected Business Activities
TIP: Projected activities should be consistent with an Applicant’s request for a NMTC Allocation. An
Applicant that has a readily identifiable set of business activities in which it will engage in the near term
will score well under this sub-section, as will an Applicant that can demonstrate an effective strategy for
locating qualifying activities.

TIP: Applicants that plan to finance a single or discrete number of investments are expected to provide
a greater level of detail about their planned transactions in order to score well in comparison to those
Applicants intending to fund a general pipeline.
TIP: An Applicant that indicates that its application is in support of a single activity or a discrete list of
QLICIs as listed in Question #19 will likely be required to close such transactions, as a condition of
receipt of a NMTC Allocation, and such requirement will be a term of the Allocation Agreement.

19. Projected NMTC Investments
(a) Complete Tables B1-B5, as applicable, according to the types of QLICI activities in
which the Applicant intends to engage.
(b) Please indicate if the Applicant plans to finance:
____ A single or discrete number of investments
____ A general pipeline of activities
(c) Please write a narrative describing the Applicant’s planned investments:
Single or discrete number of investments: If the Applicant intends to invest in one or a
few discrete projects only, provide a narrative below to describe:
 The feasibility and current status of each transaction (e.g., fully negotiated and
committed, in preliminary discussions, etc.);
 The location of the project(s);

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 15

 The anticipated dates for project financing (including total project cost and NMTC
financing) and completion;
 The risks that may preclude the project(s) from being completed within the timeframes
identified.
General pipeline of activities: If the Applicant intends to support a general pipeline of
activities that may or may not yet be identified, provide a narrative below to describe:
 The number and dollar amount of transactions that have already been identified, for
which underwriting is completed or underway;
 Transactions that represent the type(s) of NMTC investments that the Applicant
intends to make. Be sure to indicate the total project cost and provide an estimate of
the amount of QLICI investment for each transaction;
 The Applicant’s strategy for identifying potential borrowers, investees, or other
customers in Low-Income Communities;
 The extent to which the Applicant intends to invest interest, dividends or other profits
received from QLICIs into additional QLICIs, and the timeline for doing so.
(Maximum Response Length: 10,000 characters)

(d) Explain how income and expense considerations of the CDE factor into the Applicant’s
business strategy and project selection (e.g., number and size of transactions,
location, business type, industry, etc.).
(Maximum Response Length: 3,000 characters)

20. Value Added and Innovative Investments
Indicate whether and explain how the Applicant intends to use the requested NMTC
Allocation to make value added investments that might not otherwise occur or represent an
innovative use of a NMTC Allocation. Check any option that applies and provide a narrative
for each item checked:

TIP: The Applicant will be scored more favorably in this section to the extent it effectively
demonstrates that a NMTC Allocation will enable it to increase the volume of the Applicant’s (or
Controlling Entity’s) LIC investments, undertake activities of greater financial risk in LICs, and/or
undertake innovative investments that would be unlikely in LICs without a NMTC Allocation.
TIP: Applicants do not need to select multiple options in order to score well in this section. No one
activity, increase in volume, activities of greater risk, or innovative investments, is preferred over any
other for scoring purposes.

____(a) Increase the volume of its activities. Demonstrate how the requested NMTC
Allocation will enable the Applicant to achieve a greater dollar volume of
2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 16

investment in LICs. Be sure to quantify the increase in LIC activities that the
Applicant (or its Controlling Entity) proposes to invest over the next five years
with a NMTC Allocation and compare with its five-year track record shown in
Exhibit A.
(Maximum Response Length: 5,000 characters)

____(b) Undertake activities of greater financial risk. Describe how the requested
NMTC Allocation will enable the Applicant to make investments in LICs involving
greater financial risk than would otherwise occur (e.g., financing projects in
unproven markets, financing businesses that do not have access financial
markets, etc.). Be sure to quantify the additional financial risk associated with the
proposed investments to be undertaken with a NMTC Allocation. Also compare
the risk of the Applicant's proposed NMTC investments to the Applicant's (or its
Controlling Entity's) non-NMTC investments. Consider providing examples to
illustrate investments that would be approved using the requested NMTC
Allocation versus investments not using the requested NMTC Allocation.
(Maximum Response Length: 5,000 characters)

TIP: If the Applicant proposes to pursue innovative QLICIs by investing in states that have historically
received fewer dollars of QLICIs, the Applicant should refer to the Application Q&A to find a list of 10
states (plus Puerto Rico) that have received the least QLICI investments through 2011, based on CIIS
reporting data. If selecting the innovation option, note that no particular innovation is preferred over
another for scoring purposes. Any proposed innovative investments should be quantified as a
percentage of the Applicant’s total QLICIs. If the Applicant receives a NMTC Allocation, it may be
required to meet the percentage identified in Q.20(c), and such requirement may be a term of its
Allocation Agreement.

___(c) Pursue Innovative QLICIs. Demonstrate how the requested NMTC Allocation
will enable the Applicant to engage in innovative uses of a NMTC Allocation (e.g.,
invest in unrelated CDEs that do not have NMTC Allocations; target states
identified by the CDFI Fund as having received fewer dollars of QLICIs; provide
QLICIs in amounts of $2 million or less; revolve QLICIs to serve more QALICBs;
provide QLICIs for working capital, inventory or equipment purchase, etc.).
(Maximum Response Length: 5,000 characters)

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 17

D. Non-Metropolitan Counties

TIP: As provided for in Section 102(b)(6) of the Tax Relief and Health Care Act of 2006 (Pub. L. 109432), and described further in the NOAA and the Q&A document that accompanies this application, the
CDFI Fund has established the goal that: (i) 20 percent of all QLICIs made by Allocatees under the this
Round are invested in Non-Metropolitan Counties; and (ii) a proportionate number of Rural CDEs (as
defined in the NOAA) receive allocation awards.
Applicants are therefore required to provide two target estimates below: a minimum percentage of
QLICIs the Applicant is willing to commit to provide to Non-Metropolitan Counties; and the maximum
percentage of QLICIs that the Applicant is willing to commit to providing to Non-Metropolitan Counties.
At the discretion of the CDFI Fund, the Applicant may be required to deploy a percentage of its
allocation at or above the minimum indicated in Question #21(b), but not more than the percentage
indicated in Question #21(c); and such requirement shall become a condition of its Allocation
Agreement with the CDFI Fund.
An Applicant that presents a minimum of a three-year track record of direct financing in Exhibit A,
responds “Yes” to Question #21(a) (including an appropriate supporting narrative), commits to a figure
of 50 percent or greater in response to Question #21(c) may be deemed to be a Rural CDE, and may
be eligible to receive special consideration for a NMTC Allocation in accordance with the process
outlined in the NOAA. See the Application Q&A.
An Applicant may receive a larger NMTC Allocation than would otherwise be the case, regardless of
designation as a Rural CDE, if the CDE: (i) makes a minimum commitment of 20 percent or greater in
response to Question #21(b); (ii) has a track record of providing direct financing in Non-Metropolitan
Counties and a strong strategy for deploying NMTC investments in these communities; (iii) and is
ranked highly enough to be considered for an allocation.
In accordance with the NOAA for this Round, in the event the CDFI Fund adds additional Rural CDEs
to the Allocatee pool in order to achieve the targeted percentage of investment in Non-Metropolitan
Counties, Applicants that commit to providing at least 20 percent of their QLICIs in Non-Metropolitan
Counties will not be subjected to award reductions, and therefore may receive a larger NMTC allocation
award than may have otherwise been the case.

21. (a) Have at least 50 percent of the Applicant’s (or Controlling Entity’s) total direct financing
dollars over the past five years, as shown in Exhibit A, been directed to Non-Metropolitan
Counties?
______ Yes

______ No

(b) What is the minimum percentage of QLICIs that the Applicant is willing to commit to
deploy in Non-Metropolitan Counties?
______%
(c) What is the maximum percentage of QLICIs that the Applicant is willing to commit to
deploy in Non-Metropolitan Counties?
(Note: this value must be equal to or greater than the value for Question #21(b).
______ %
(d) If the response to Question #21(c) above is greater than zero percent, referencing Exhibit
A, briefly describe the Applicant’s (or its Controlling Entity’s) five-year QLICI and nonQLICI direct financing track record in Non-Metropolitan Counties. Specifically, describe

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 18

the types of projects and the dollar amounts that the Applicant (or its Controlling Entity)
provided directly to projects located in Non-Metropolitan Counties. See the Application
Q&A.
(Maximum Response Length: 2,000 characters)

(e) If the response to Question #21(c) above is greater than zero percent, and only to the
extent not discussed elsewhere in the application, discuss the Applicant’s strategy for
deploying QLICIs in Non-Metropolitan Counties.
(Maximum Response Length: 5,000 characters)


Indicate the number and dollar amount of transactions that have already been
identified in Non-Metropolitan Counties, for which underwriting is completed or
underway.



Provide sample transactions in the Applicant’s Non-Metropolitan pipeline. Be sure
to indicate the total project cost and provide an estimate of the amount of QLICI
investment for each transaction.



Discuss the key challenges the Applicant anticipates it will have as it undertakes
QLICI investments in Non-Metropolitan Counties and how the Applicant proposes
to overcome those challenges.

E. Investments in Unrelated Entities
TIP: The NMTC Program legislation requires the CDFI Fund to give priority to Applicants that intend to
use “substantially all” of their QEI proceeds to make investments in one or more businesses in which
persons Unrelated to the Applicant hold the majority equity interest. An Applicant that answers “Yes” to
Question #22 will be awarded five additional points. An Applicant that receives priority points under
this sub-section will be required, in its Allocation Agreement, to invest substantially all of its QEI
proceeds in Unrelated entities. Please refer to the NMTC Allocation Application Q&A document for
more information about what is considered an Unrelated entity transaction.

22. Does the Applicant intend to use substantially all of the proceeds of its QEIs to make QLICIs
in one or more businesses in which persons Unrelated to the Applicant hold the majority
equity interest?
____ Yes ____ No
23. Notable Relationships. Describe any potential situations in which the Applicant, its Affiliates
or its personnel (persons involved in identifying projects or making investment decisions on
behalf of the Applicant, including governing or advisory board members), will receive
financial benefits from the QALICBs financed with the Applicant’s QLICIs.
(a) Will the Applicant, its Affiliates or its personnel own more than a 1 percent interest in
the QALICB?
____Yes ____ No

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 19

(b) Will the Applicant, its Affiliates or its personnel provide professional services
(developer, real estate agent, property manager, or general contractor) for the
QALICB?
____Yes ____ No
(c) Will the Applicant, its Affiliates or its personnel be lessees at property developed with
the QLICI?
____Yes ____ No
(d) Will the Applicant, its Affiliates or its personnel be a party to a business transaction
financed with the QLICI?
____Yes ____ No
(e) Are there other financial benefits that the Applicant, its Affiliates or its personnel may
receive, but are not included in items (a)-(d) above?
____Yes ____ No
For items (a)-(e) above for which “Yes” was selected, describe such situations:
(Maximum Response Length: 2,000 characters)

(f) Discuss how such relationships will create benefits (i.e. cost savings, lower fees) for
unaffiliated end-users, such as QALICBs, tenant businesses, or residents of LowIncome Communities. (Maximum Response Length: 2,000 characters)

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 20

Part II: Community Outcomes
Total Maximum Points for Part II: 25 points
TIP: The CDFI Fund will review the extent to which the Applicant’s strategy will have positive
community development outcomes. An Applicant will generally score well under this section to the
extent that: a) it is working in particularly economically distressed or otherwise underserved
communities; b) it shows demonstrable community development outcomes; and c) it demonstrates
meaningful engagement with community stakeholders when vetting potential NMTC investments.

A. Targeting the Use of QLICIs
24. Identify all of the areas likely to be served by the Applicant (check all that apply):
1. ____

[SEVERE DISTRESS] Census tracts with poverty rates greater than 30
percent; OR Census tracts with, if located within a non-Metropolitan
Area, median family income that does not exceed 60 percent of
statewide median family income, or, if located within a Metropolitan
Area, median family income that does not exceed 60 percent of the
greater of the statewide median family income or the Metropolitan Area
median family income; OR Census tracts with unemployment rates at
least 1.5 times the national average.

2. _____ [NON-METROPOLITAN COUNTIES] Qualifying census tracts that are
located in counties not contained within a Metropolitan Statistical Area
(MSA), as defined in OMB Bulletin No. 10-02 (Update of Statistical Area
Definitions and Guidance on Their Uses) and applied to the 2010
census tracts.
3. ____

[TARGETED POPULATIONS] As permitted by IRS and related CDFI
Fund guidance materials, projects serving Targeted Populations to the
extent that: (a) such projects are 60 percent owned by Low-Income
Persons (LIPs); or (b) at least 60 percent of employees are LIPs; or (c)
at least 60 percent of customers are LIPs.

4. ____

[25% POVERTY/70% MEDIAN FAMILY INCOME/1.25
UNEMPLOYMENT RATE] Census tracts with one of the following: (i)
poverty rates greater than 25 percent; or (ii) if located within a nonMetropolitan Area, median family income that does not exceed 70
percent of statewide median family income, or, if located within a
Metropolitan Area, median family income that does not exceed 70
percent of the greater of the statewide median family income or the
Metropolitan Area median family income; or (iii) unemployment rates at
least 1.25 times the national average.

5. ____

[SBA Designated HUB ZONES] to the extent QLICIs will support
businesses that obtain HUB Zone certification by the SBA.

6. ____

[BROWNFIELDS] Brownfield sites as defined under 42 U.S.C. 9601
(39).

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 21

7. ____

[HOPE VI REDEVELOPMENT] Areas encompassed by a HOPE VI
redevelopment plan.

8. ____

[FEDERAL NATIVE AREAS] Federally designated Native American or
Alaskan Native areas, Hawaiian Homelands, or redevelopment areas by
the appropriate Tribal or other authority.

9. ____

[ARC/DRA AREAS] Areas designated as distressed by the Appalachian
Regional Commission or Delta Regional Authority.

10. ____ [COLONIAS AREAS] as designated by the U.S. Department of Housing
and Urban Development.
11. ____ [FEDERAL MEDICALLY UNDERSERVED AREAS] Federally
designated medically underserved areas, to the extent QLICI activities
will result in the support of health related services.
12. ____ [STATE/LOCAL ECONOMIC ZONES] State Enterprise zone programs,
or other similar state/local programs targeted towards particularly
economically distressed communities.
13. ____ [FEMA DISASTER AREAS] Counties for which the Federal Emergency
Management Agency (FEMA) has: issued a “major disaster declaration”
and made a determination that such County is eligible for both
“individual and public assistance”; provided that the initial investment will
be made within 24 months of the disaster declaration.
14. ____ [TRADE ADJUSTMENT ASSISTANCE] Businesses certified by the
Department of Commerce as eligible for assistance under the Trade
Adjustment Assistance for Firms (TAA) Program.
15. ____ [HEALTHY FOODS FINANCING INITIATIVE DESIGNATED FOOD
DESERTS] Census tracts identified as Food Deserts under the HFFI
definition (USDA-ERS), to the extent QLICI activities will increase
access to healthy food.

(a) Will the Applicant commit to providing at least 75 percent of its QLICIs (in terms of
aggregate dollar amounts) in areas that are either: (1) characterized by at least one of
items 1-3 on the above list for each QLICI; or (2) characterized by at least two of items
4-15 on the above list for each QLICI?
_____Yes

_____No

TIP: An Applicant that checks “Yes” to Question #24(a) above will generally be scored more favorably.
Note that, if the Applicant receives a NMTC Allocation, it will be required to meet the percentage figure
identified above, and such requirement will be a term of its Allocation Agreement.

(b) Discuss how the Applicant will target QLICIs to areas marked by the specific indicators
of higher distress selected in Question #24(a). In particular, please describe:

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 22



The criteria used to prioritize QLICIs, assuming the Applicant has greater
investment opportunities than available allocation authority.



The outreach strategies that are used to locate potential investments in these
areas of higher distress.



Examples (if available) of how the Applicant has used these strategies to identify
high impact investments in areas of higher distress.
(Maximum Response Length: 5,000 characters)

B. Community Development Outcomes – Prior Performance and Projections
TIP: An Applicant may score higher to the extent that its projected activities will generate significant
and meaningful outcomes in the communities affected, not simply based on the sheer number of
outcomes selected in Question #25.
TIP: An Applicant will score well in this sub-section to the extent that it has a track record of producing
meaningful quantitative and qualitative community outcomes similar to those expected to be achieved,
to the extent that it demonstrates that significant quantitative and qualitative outcomes will result from
its investments, and to the extent it clearly articulates its methodology and assumptions used to
quantify both the outcomes resulting from its past investments, as well as outcomes going forward. If
the Applicant selected Job Creation as an outcome, it may score higher if it can quantify that jobs
created represent both Quality of Jobs and/or Jobs Accessible to Low-Income Persons or residents of
Low-Income Communities.

25. Community Development Outcomes
(a) Select the outcome(s) the Applicant expects to achieve as a result of the projected
QLICIs described in the Business Strategy section. Select all that apply. For every
outcome selected, please:
 Quantify, to the extent possible, the Applicant’s projected community development
outcomes;
 Explain how the Applicant estimated the potential outcomes that would result from
receiving a NMTC Allocation;
 To the extent the Applicant has a track record of achieving such outcomes in past
investments, please describe and compare past outcomes with projected outcomes.
(Maximum Response Length: 5,000 characters)

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 23

1.

____ JOB CREATION. Quantify, as best as possible, the number of direct jobs (either
in the aggregate or on average at each project financed) that will be created or
maintained through the Applicant’s QLICIs. Be sure to discuss both temporary
jobs (e.g., construction) and permanent jobs. Describe how these projections
compare to what the Applicant has historically achieved.

2.

____ QUALITY OF JOBS. Discuss the extent to which the Applicant’s investments will
result in opportunities for Low-Income Persons or residents of Low-Income
Communities to build wealth, receive living wages (e.g., the minimum hourly wage
necessary for an individual to meet basic needs, including housing, nutrition, daily
living expenses and other incidentals such as clothing, for an extended period of
time), and employment benefits (e.g., health insurance, retirement benefits,
employee stock ownership, etc.).

3.

____ JOBS ACCESSIBLE TO LOW-INCOME PERSONS OR RESIDENTS OF LOWINCOME COMMUNITIES. Discuss the Applicant’s strategy for targeting jobs to
Low Income Persons or residents of Low-Income Communities, as well as
opportunities for training and advancement.

4.

____ COMMERCIAL GOODS OR SERVICES TO LOW-INCOME COMMUNITIES.
Describe the extent to which the Applicant’s NMTC investment strategy seeks to
increase the provision of goods or services to residents of Low-Income
Communities or Low-Income Persons (e.g., access to retail, restaurants, or
pharmacies, etc.).

5.

____ COMMUNITY GOODS OR SERVICES TO LOW-INCOME COMMUNITIES.
Describe the extent to which the Applicant’s NMTC investment strategy seeks to
increase access to goods or services to residents of Low-income Communities or
Low-Income Persons (e.g., social, educational, health care, or cultural, etc.).

6.

____ FINANCING MINORITY BUSINESSES. Describe the extent to which the
Applicant will focus its NMTC investments in Minority-owned or Minority-controlled
businesses, including (in the case of real estate QALICBs) developers, projectsponsors or contractors/subcontractors that are Minority-Owned or MinorityControlled.

7.

____ FLEXIBLE LEASE RATES. To the extent the Applicant is financing real estate
QALICBs, describe the efforts the Applicant will make to ensure that tenantbusinesses, specifically locally-owned businesses, Minority-owned or Minoritycontrolled businesses and non-profit organizations, will receive rent reductions or
be able to purchase their properties.

8.

____ HOUSING UNITS. Describe the extent to which the Applicant will provide housing
opportunities to Low-Income Persons or residents of Low-Income Communities;
the extent to which housing will be offered in areas of high housing need, including
communities with high concentrations of vacancies or foreclosures; and/or the
extent to which the housing development adheres to principles of “smart growth”,
including transit-oriented development.

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 24

9.

____ ENVIRONMENTALLY SUSTAINABLE OUTCOMES. Describe the extent to which
the Applicant will finance projects which remediate environmental contamination
(including addressing environmental health in Low-Income Communities); meet
LEED certification standards; and/or directly support the production or distribution
of renewable energy resources (e.g., biomass, hydro, geothermal, solar, wind,
etc.).

10. ____ HEALTHY FOOD FINANCING. Describe the extent to which the Applicant will
finance projects, particularly retail outlets such as grocery stores, supermarkets
and farmer’s markets that increase access to fresh and healthy food for LowIncome Persons or Low-Income Communities. Indicate how the Applicant will
identify and target areas that are Food Deserts or otherwise have demonstrated
lack of access to fresh and healthy food.
11. ____ OTHER. In the space provided, please describe any other community outcomes
that the Applicant expects to achieve. [Applicants will be able to enter up to two
community outcomes in this section of the electronic Allocation Application.]

(b) Describe how the Applicant will track and document the community development
outcomes it expects to achieve as a result of receiving a NMTC Allocation. To the
extent the Applicant has a track record monitoring these types of community
outcomes, please describe. (Maximum Response Length: 5,000 characters)

(c) Will the Applicant use NMTC dollars to finance projects that would result in developing
or rehabilitating rental or for-sale housing?
____Yes

____ No

TIP: Please note that Question #25(c) includes activities directed to the development or rehabilitation of
ALL housing, including housing units resulting from mixed-use projects. If the Applicant indicates
“Yes” to Question 25(c) and receives a NMTC Allocation, it will be required to provide at least 20
percent of aggregate units as affordable housing units (e.g. affordable to persons with incomes less
than 80 percent of AMI), and such requirement will be a term of its Allocation Agreement. If the
Applicant indicates “No” to Question 25(c) and receives a NMTC Allocation, it will be prohibited from
using NMTC dollars to finance ANY housing units (see the Application Q&A).

(d) If the Applicant responded “Yes” to Item 10 in Question #25(a), what percentage and
dollar amount of the Applicant’s NMTC activities will focus on healthy food financing,
including activities in Food Deserts (assuming the Applicant is awarded the total
requested allocation)?

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 25

TIP: As part of the Healthy Food Finance Initiative (HFFI), the CDFI Fund is seeking to track the
anticipated amount of NMTC healthy food financing investments, including those investments made in
Food Deserts. This information is being collected and will be tracked for informational purposes. The
Applicant will not be held to the commitments made in Question #25(d) below, nor will the information
provided in Question #25(d) affect the scoring of the application. Awardees that engage in these
activities may be publicly acknowledged as participating in the HFFI.

________% Minimum
$________ Estimated Total Dollar Invested
________ Estimated Number of Projects to Be Financed

26. Community Accountability and Involvement
Please indicate how the Applicant, prior to approving an investment, ensures that an
investment into a project or business is supported by and beneficial to the community
surrounding it. (Maximum Response Length: 5,000 characters)


Describe the Applicant’s process for analyzing the potential benefits to
Disadvantaged Business and Communities and the extent to which the Applicant’s
Advisory Board and/or members of LICs participate in this process.



Discuss the Applicant’s process for determining if a proposed investment aligns
with community priorities and how this process affects investment decisions.



To the extent possible, provide examples of the Applicant’s track record of
community engagement (excluding the activities of the Advisory Board).

27. Additional Investment
(a) Discuss the extent to which the Applicant’s proposed QLICIs described in the Business
Strategy section are expected to result in additional private investment beyond the
initial investment in the Low-Income Community (LIC). To the extent possible, provide
examples where the Applicant’s investments in the past have spurred additional
private investment into LICs by expansion or creation of new businesses.
(Maximum Response Length: 5,000 characters)

(b) Discuss the extent to which the Applicant’s proposed QLICIs are part of a broader
community or economic development strategy (e.g. neighborhood revitalization

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 26

initiatives). Please describe how investments contribute to the goals of such strategies
or initiatives.
(Maximum Response Length: 3,000 characters)

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 27

Part III: Management Capacity
Total Maximum Points for Part III: 25 points
28. Organizational Chart and Key Personnel
(a) Submit organizational chart(s) that depict the following:


The Applicant’s relationship to its Controlling Entity and any Affiliate or Subsidiary
entities (if applicable); and



The Applicant’s staffing structure, including key board committees.

TIP: Be sure to refer to the Applicant Instructions for information regarding the submission of these
documents. All attachments must be submitted online through the Applicant’s myCDFIFund account.

(b) Complete Table C1. Identify all personnel, including consultants and board members
(if applicable) that will have a key role in:


Deploying Capital - locating, underwriting, and approving investments, and/or in
providing Financial Counseling and Other Services;



Raising Capital from Investors – including raising tax credit equity and leveraged
debt if the Applicant will use the leveraged investment model;



Asset and Risk Management;



NMTC Program Compliance.

29. Experience Deploying Capital or providing Financial Counseling and Other Services:
TIP: The CDFI Fund expects the Applicant’s personnel to have relevant experience in the types of
activities the Applicant intends to pursue with its NMTC Allocation – particularly in situations where the
Applicant (or its Controlling Entity) lacks prior organizational performance in deploying capital or related
services. An Applicant that can also demonstrate that its personnel have experience working in LowIncome Communities will score particularly well.

(a) Describe the collective roles, responsibilities, and experience of key personnel,
consultants and board members in deploying capital to Low-Income Communities
and/or providing Financial Counseling and Other Services, if applicable. The Applicant
should reference information from Table C1 as necessary.
(Maximum Response Length 5,000 characters)

(b) Describe how the Applicant will manage the addition of NMTC activities into its
current portfolio of activities, including whether additional staff will need to be hired.
(Maximum Response Length: 2,000 characters)

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 28

30. Asset and Risk Management Experience:
TIP: Each Applicant must demonstrate that it has the capacity and relevant experience to manage the
types of assets it intends to invest in with the requested NMTC Allocation, as well as monitor and
control associated risks. An Applicant that has experience successfully managing an investment
portfolio, has experienced staff, and has established systems and plans to manage the informational
and performance aspects of administering such assets or pools of similar assets will score well under
this sub-section.

(a) Describe the collective roles, responsibilities, and experience of key personnel,
consultants and board members in managing the Applicant’s assets and risk. The
Applicant should reference information from Table C1 as necessary.
(Maximum Response Length 5,000 characters)

(b) Describe how the Applicant will manage the addition of NMTC activities into its
current portfolio of activities, including whether additional staff (including consultants,
third-party firms, or other CDEs) will need to be hired. (Maximum Response Length
2,000 characters)

(c) For the Applicant (or Controlling Entity), complete Table D1 (Investment Portfolio) and
discuss the Applicant’s (or Controlling Entity’s) delinquency rate(s) as of March 31,
2013 for each major product line as well as its default rate (write-offs) over the past 3
years for each major product line. Also:
 Describe the trends in delinquencies and write-offs and defaults as shown in Table
D1.
 Explain the reasons for any negative results such as an increase in delinquencies
or any unusual spikes in write-offs or loan restructurings that have occurred.
 If the Applicant, or its Controlling Entity, is a regulated financial institution, please
compare delinquency and default rates with the appropriate peer group.
(Maximum Response Length 5,000 characters)

TIP: Delinquency rate means the percentage of loan payments and mandatory dividend payments, on
a dollar basis, that were 90 days past due (i.e., the combined dollar amount of principal, interest and
mandatory dividend payments, 90 days or more past due divided by the total dollar amount of loans
and equity investments outstanding).

(d) For each major product line, describe how the Applicant (or Controlling Entity)
monitors financial assets. Explain how the organization identifies assets at greater

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 29

risk (such as use of a risk rating system for a loan portfolio) and how the organization
responds when assets are at greater risk.


Indicate if the Applicant (or Controlling Entity) has written asset management and
collection policies and whether it has ever deviated from those policies in the past
five years and, if so, why.



Address the Applicant's strategy for minimizing defaults and managing
delinquencies to mitigate against write-downs or write-offs going forward.
(Maximum Response Length 5,000 characters)

(e) Discuss any delinquent, defaulted, or impaired loans or equity investments from prior
NMTC investments. Note the total value of each investment, as well as the total
number of days delinquent or the amount charged off. Discuss the Applicant’s
strategies for managing these troubled investments, including any work-out strategies
used. (Maximum Response Length 5,000 characters)

31. Program Compliance Experience:
TIP: Each Allocatee must have the capacity to remain in compliance with NMTC Program
requirements. An Applicant will score well to the extent that it can: 1) demonstrate experience with
similar regulatory compliance requirements, including compliance under other tax credit programs; and
2) articulate a specific strategy for ensuring that its NMTC-related investments will qualify at the time of
investment and throughout the seven-year credit period.

(a) Describe the collective roles, responsibilities, and experience of key personnel,
consultants and board members in managing the Applicant’s regulatory and tax
compliance. The Applicant should reference information from Table C1 as necessary.
(Maximum Response Length 5,000 characters)

(b) Discuss how the Applicant’s systems and procedures (e.g., portfolio monitoring,
reporting, investment/re-investment strategies) will ensure ongoing compliance with
NMTC Program requirements. Specifically, be sure to indicate how the Applicant will
ensure that: (Maximum Response Length: 10,000 characters)


At least 85 percent of the proceeds of the QEIs are invested in QLICIs in
accordance with the NMTC Program Income Tax Regulations. If the Applicant is
providing loans or investments to another CDE, how will it ensure that the
secondary CDE fulfills its investment requirements?



The businesses that the Applicant invests in are QALICBs, in accordance with the
NMTC Program Income Tax Regulations. If purchasing a portfolio of loans, how
will the Applicant ensure that it purchases loans that are QLICIs?

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 30



Payments of, or for, capital, equity, or principal by its borrowers or investees are
re-invested into QLICIs within applicable reinvestment periods. If providing loans
to or investments in another CDE, how will it ensure that the secondary CDE
fulfills its re-investment requirements?

32. Low-Income Community Accountability:
TIP: All CDEs are required to maintain accountability to Low-Income Communities. An Applicant that
can articulate meaningful involvement with Low-Income Community decision-makers will score well
under this sub-section.

(a) Complete Table C2.
(b) Describe how Low-Income Community representatives to the Governing or Advisory
Board will be directly involved in the design and/or implementation of the Applicant’s
investment strategy. Provide a narrative that addresses the following: (Maximum
Response Length: 5,000 characters)


The number and percentage of Low-Income Community representatives on the
Applicant’s Advisory and Governing Boards.



The role, formal or otherwise, these individuals or their organizations play in
formulating and approving the Applicant’s pipeline of investments.



The role, specific to the Applicant’s Governing Board, these individuals have in
approving investment parameters or decisions.

33. If the Applicant, or its Controlling Entity, is an insured financial institution that receives
Community Reinvestment Act (CRA) ratings from regulators, please indicate the CRA ratings
that it has received over the past five years. If the most recent CRA rating is less than
“Outstanding”, describe: 1) the conditions or circumstances that led to the rating; 2) the steps
the institution is taking to achieve an “Outstanding” rating; and 3) the role that NMTC
activities are expected to play in helping the institution to achieve an “Outstanding” rating.
(Maximum Response Length: 2,000 characters)

34. Financial Health:
Answer the following questions regarding the Applicant’s (or the Controlling Entity’s) financial
health. Indicate if the responses are (check one):
2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 31

____ For the Applicant (if it has incurred operating expenses).
____ For the Controlling Entity (if the Applicant has not yet incurred operating
expenses).
____ Not applicable (neither the Applicant nor the Controlling Entity has incurred
operating expenses).
(a) Have the financial statements for the last complete fiscal year been independently
audited or is an audit underway? ___ Yes
___ No
Please provide fiscal year end date for the last completed independent audit
(mm/dd/yyyy). If no audit has been completed or is underway for the last complete
fiscal year, please explain why and what steps the Applicant, or its Controlling Entity,
is taking to obtain audited financials in the future:
(Maximum Response Length: 2,000 characters)

(b) If Yes, have any of the Applicant’s, or its Controlling Entity’s, completed audits within
the past three years (or, if shorter, for the period from inception) indicated any of the
following:
1. An opinion other than unqualified?

___ Yes

___ No

2. A going-concern paragraph?

___ Yes

___ No

3. Repeated findings of reportable conditions?

___ Yes

___ No

4. Material weaknesses in internal controls?

___ Yes

___ No

5. If Yes to any of the above, indicate the fiscal years of the occurrences and
describe the circumstances and corrective action(s) being taken:
(Maximum Response Length: 2,000 characters)

(c) Have the Applicant’s, or its Controlling Entity’s financial statements shown positive net
income (or if a non-profit, positive change in net assets) for each of the last three
years, or if in business for less than three years, for the period of time it has
operated?
____ Yes
____ No
If No, please explain the circumstances, indicate the fiscal year in which this occurred,
and describe the corrective action being taken:
(Maximum Response Length: 2,000 characters)

(d) Is the Applicant (or Controlling Entity) aware of any non-compliance issues cited since
the issuance of its most recent audited financial statements or Management’s Annual
Report on Internal Controls Over Financial Reporting?
____ Yes

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

____ No

Page 32

If Yes, please explain the circumstances and describe the corrective action being
taken: (Maximum Response Length: 2,000 characters)

(e) Complete Table D2 based on the projected activities reflected in Exhibit B. Based on
the projections in Table D2:


Describe the Applicant’s projected income and expense(s) associated with
administering the Applicant’s NMTC line of business and how the Applicant will be
able to sustain this line of business, consistent with its overall business strategy,
including its timeline for making investments.



If the Applicant will use existing resources (e.g., accumulated cash balances),
third-parties as a source of operating income (e.g., grants or loans), or in-kind
contributions (e.g. use of personnel, back office systems), describe the Applicant’s
progress in securing firm commitments;



Explain how the Applicant would address any operating deficit. (e.g., income or
loan from Affiliates or alternate sources, reduce scope of activities, use reserves,
etc.).
(Maximum Response Length: 5,000 characters)

TIP: The narrative response in Q. 34(e) should clearly describe the assumptions and calculations used
to derive each income and expense line from Table D2 in a way that a reviewer will be able to easily
understand, quantify, and evaluate. The Applicant should indicate whether it is using cash or accrual
methods of accounting. Table D2 should be completed using the Applicant’s fiscal year indicated in
Q.2(i) (see the Application Q&A)

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 33

Part IV: Capitalization Strategy
Total Maximum Points for Part IV: 25 points

A. Investor Strategy
TIP: An Applicant that demonstrates a high level of investor Commitment and/or a strong strategy for
raising capital will score well under this sub-section. Additionally, the CDFI Fund expects consistency
between the Applicant’s request for a NMTC Allocation, the degree of investor interest, and the
Applicant’s strategy to deploy its QEI proceeds in QLICIs. If an Applicant is seeking investments from
investors that have not yet provided Commitments, the Applicant may score well to the extent it has a
reasonable strategy for obtaining such Commitments.

35. Complete Tables E1 and E2 and describe the track record of the Applicant (or its Controlling
Entity) raising capital from third-party sources, particularly equity capital at market or nearmarket rates. Be sure to distinguish between raising capital from profit-motivated investors;
from government or philanthropic sources of capital; or using tax credits as an incentive.
Reference information provided in Table C1 as appropriate:
(Maximum Response Length: 5,000 characters)

TIP: Applicants completing Table E1 are required to submit, along with their applications,
documentation demonstrating proof of investor interest (e.g., Commitment letters; Letters of
Interest/Intent). Investor letters should identify whether the investor will make a direct investment in the
CDE or into a partnership. Be sure to follow the directions in the Applicant Instructions section for
information regarding the submission of these documents.
TIP: While Table E2 must contain data only of the Applicant (or its Controlling Entity) and the track
record of the Applicant (or its Controlling Entity) must be discussed in Question #35, the Applicant may
refer in the narrative to the qualifications and five-year capital-raising track record of individuals (e.g.,
staff, principals, consultants) listed in Table C1 for organizations other than the Applicant (or its
Controlling Entity).

36. Investment Partnerships
(a) Does the Applicant intend to secure investments from partnership entities that will
leverage non-Equity Investments (e.g., debt, grant dollars) from outside of the
partnership to increase the tax credit yield for members of the partnership?
_____Yes

_____ No

(b) If Yes, provide the percentage of equity versus non-equity investments for all such
investor partnerships based on the Applicant’s requested NMTC Allocation.
___________% Equity Investments

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 34

___________% Non-Equity Investments
37. Investment Strategy
(a) Has the Applicant provided investor Commitments or Letters of Intent/Interest for
investors listed in Table E1?
_____Yes

_____ No

TIP: Applicants that answer Yes to Question #37(a) and complete Table E1 are required to submit,
along with their applications, documentation demonstrating proof of the interest of the equity investors
and debt providers (e.g., letter indicating intent of equity or debt investor to provide capital to the
partnership entity that will provide the QEI to the Applicant). Be sure to follow the directions in the
Applicant Instructions section for information regarding the submission of these documents.

(b) If Yes, discuss the Applicant’s strategy for securing investments from alternative
investors in the event that the investors listed in Table E1 are unable or unwilling to
make the anticipated investments. If the Applicant intends to secure investments
from partnership entities that will leverage non-Equity investments (e.g., debt, grant
dollars) be sure to address the strategy for identifying and securing both Equity
investments and non-Equity investments.
(Maximum Response Length: 5,000 characters)

(c) If No, discuss the Applicant’s strategy for securing NMTC investor Commitments:

38.



The Applicant’s strategy for identifying additional equity investors or non-equity
providers (if utilizing a partnership model), including the extent to which the
Applicant will be utilizing community alliances or strategic partners to raise
investment capital.



The Applicant’s timeline for securing investments from equity investors and/or
partnerships if the Applicant answered yes to Question #36(a) and, any risks that
may preclude the Applicant from closing such investments, and how the Applicant
is mitigating such risks.



If the Applicant is using a third-party investment banker to raise capital, describe
whether a contract is in place, the terms (actual or proposed) of the contract, and
the progress to date that the banker has made in securing Commitments from
investors. Do NOT list these investment bankers in Table E1.
(Maximum Response Length: 8,000 characters)

(a) Will one or more of the Applicant’s current or prospective investor(s) originate or
otherwise identify transactions in which the Applicant will invest?
____ Yes

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

_____ No

Page 35

(b) Will the Applicant receive any QEIs from Affiliates?
_____ Yes

_____ No

(c) If the answer to (a) or (b) is yes, provide narrative detailing:


The name of each such equity investor or non-equity provider;



The role of each equity investor or non-equity provider with respect to locating,
underwriting, and approving each investment;



Whether each equity investor or non-equity provider offers similar products or
services already; and



If applicable, the extent to which the Applicant will offer products with more
favorable rates or terms than those currently offered by the equity investor or nonequity provider and/or will target its activities to areas of greater economic distress
than those currently targeted by the equity investor or non-equity
provider.(Maximum Response Length: 2,000 characters)

TIP: If the Applicant has obtained or plans to obtain investments from organizations that also will
identify or originate transactions for the Applicant or organizations that are Affiliated with the Applicant,
it will score well if: a) the Applicant’s transactions are more targeted in some way to areas of greater
economic distress than those areas that investors are already reaching with their investments or loan
originations; or b) the Applicant’s products and services are offered with more favorable rates or terms
than those offered by the investor.

39. Distribution of Benefits:
TIP: The CDFI Fund expects Applicants to quantify this information and to be able to demonstrate that
there is appropriate sharing between the investor, CDE, and borrowers/investees.

(a) Quantify as best you can, for contemplated transactions in each of your planned
investment types, how economic benefits of the NMTC Allocation will be apportioned
amongst:
(i) the investors (equity and debt), through economic returns;
(ii) the Applicant (or its Subsidiaries/Affiliates), through economic returns
(including fees).
(iii) the QALICB investees/borrowers, through lower costs of capital;
(iv) if applicable, the unaffiliated end-users through lower costs (e.g., lower
tenant lease rates).
(Maximum Response Length: 5,000 characters)

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 36

(b) To the extent there is any tax credit equity remaining at the end of the seven-year
credit period, be sure to address how the residual value will be apportioned amongst
investors, QALICBs, the Applicant and/or its Affiliates. Address any terms or
conditions the QALICB must meet as a term of the distribution.
(Maximum Response Length: 3,000 characters)

(c) If the Applicant generates a profit from its overall NMTC activities, discuss how this
profit will be used. (e.g., dollar amount or percentage of profit that will be distributed to
investors or shareholders, support additional NMTC or non-NMTC Low-Income
Community investments, support other activities of the Applicant or Affiliates, etc.).
(Maximum Response Length: 2,000 characters)

B. Sources and Uses of Capital
TIP: In this sub-section, the CDFI Fund seeks to understand both how efficiently the Applicant will use
QEI proceeds and how well it is leveraging other sources of financing in conjunction with the activities
undertaken with its QEI proceeds. An Applicant that intends to invest/re-invest more than 85 percent of
its QEI proceeds in QLICIs will generally score well, provided that the Applicant can reasonably
demonstrate that it has other mechanisms in place to support its costs of operations.

40. Will more than 85 percent of the QEI proceeds be invested/re-invested in QLICIs?
____ Yes ____ No

If yes, what percentage: ______%.

TIP: The higher the percentage indicated in Question #40, the better the Applicant will score under the
Capitalization Strategy section. However, if the Applicant receives a NMTC Allocation, it will be
required to meet the percentage identified above, and such requirement will be a term of its
Allocation Agreement.

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 37

41. Minimum Request Amounts
Is there an absolute minimum amount below which the Applicant would be unwilling to
accept a NMTC Allocation?
_____ Yes _____ No
If Yes, provide the amount $_______. Describe how this amount was determined. Be
sure to address why the Applicant could not administer a smaller award:
(Maximum Response Length: 1,000 characters)

TIP: At the conclusion of the CDFI Fund’s review process, if the Applicant is recommended to receive
less than the minimum amount of allocation authority identified in Question #41, the CDFI Fund will not
provide a NMTC Allocation to the Applicant. An Applicant with a high minimum allocation request will
need to demonstrate that it can raise and deploy the NMTC Allocation requested in a timely manner;
that it will likely achieve significant community impacts or production innovations; and that it could not
successfully implement its business strategy without this minimum allocation amount.

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 38

Part V: Information Regarding Previous Awards
Information in Part V is not scored during the Phase I process of the Application review.
Information provided in this section is considered during the Phase II process of the Application
review. For more information on the NMTC Application review process, please consult the NOAA.
42. CDFI Fund Award Status:
Has the Applicant and/or any of its Affiliates previously received a financial award (not
including a NMTC Allocation) from the CDFI Fund?
____ Yes

____ No

If Yes, please list the award(s) in the table. The Applicant may use additional space as
necessary:
Name of Awardee:
Award control number:
Total award amount:

Name of Awardee:
Award control number:
Total award amount:
43. NMTC Allocation Status:
Has the Applicant and/or any of its Affiliates received a NMTC Allocation from the CDFI
Fund in a prior allocation round?
____ Yes

____ No

If No, please skip Question #44. If Yes, please list the allocation(s) in the table. The
Applicant may use additional space as necessary:
Name of Allocatee:
Award control number:
Total allocation amount:
Name of Allocatee:
Award control number:
Total allocation amount:
TIP: Applicants should only list NMTC Allocations that have been directly awarded to the Applicant
and/or any of its Affiliates. Do include information on NMTC Allocations awarded to CDEs if the
Applicant’s only relationship to that CDE is through a QEI made into the CDE by the Applicant or an
Affiliate of the Applicant.

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 39

44. If the Applicant answered Yes to Question #43, briefly explain the status of its previous
allocation award(s). Be sure to address:
(a) The number and dollar amount of QEIs issued on each award and the number and
dollar amount of QLICIs made with each award.
(Maximum Response Length: 2,000 characters)

(b) If the Applicant has made QLICIs, describe the types of transactions that have been
financed to date. The Applicant must discuss:


The largest project from each of Applicant’s three most recent Allocations. If the
Applicant has received less than three Allocations, it should discuss the three
projects that received the largest investments in the last five years.



For each project identified, describe how NMTC proceeds were used to finance
transactions that would not have otherwise occurred.



Any community outcomes or benefits that were generated as a result of the
transaction.



The source(s) and amount(s) of leveraged debt (including the percentage of
leverage sources derived from project sponsor equity), if any.



Any investment-related fees and third-party expenses paid by the QALICB or the
QALICB’s affiliates that were paid either to the Applicant, its Affiliates, QEI
investors or directly to any other parties in connection with consideration or receipt
of the QLICI investment(s) (e.g., fees and expenses associated with leverage
debt, accounting, legal, etc.).
(Maximum Response Length: 10,000 characters)

(c) If the Applicant co-invested in a project(s) with other CDEs, explain what actions the
CDE took to control expenses paid by QALICBs and investors. (e.g., CDE used one
set of documents, shared professional expenses, etc.).
(Maximum Response Length: 3,000 characters)

(d) Discuss whether the activities undertaken with the NMTC dollars were consistent (with
respect to product offerings; markets served; rates and terms; etc.) with the business
strategy presented in the relevant Allocation Application. If the activities were not
consistent with the relevant Allocation Application, describe the inconsistencies.
(Maximum Response Length: 3,000 characters)

TIP: Receipt of a prior award or allocation through any of the CDFI Fund's programs will not affect the
likelihood of an Applicant receiving a NMTC Allocation in this round. The CDFI Fund will examine the
compliance status of Applicants (or their Affiliates) that have previously received CDFI Fund awards or
allocations.

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 40

An Applicant that has received (or whose Affiliates have received) a NMTC Allocation under a previous
allocation round is NOT eligible to receive allocations under this allocation round unless the prior-year
Allocatee has met certain minimum threshold requirements regarding the issuance of its QEIs. Be sure
to review the NOAA for this Round for additional information regarding this and other requirements
pertaining to Applicant eligibility under this Round.
TIP: The CDFI Fund will review transaction-level data submitted by Applicants that are prior year
Allocatees through the Community Investment Impact System (CIIS) and may seek additional
information from Applicants, to determine whether activities and the QLICIs made were consistent with
the transactions and activities proposed in the relevant prior-year Allocation Application(s).

(e) To the extent the Applicant’s past transactions have been structured to allow QALICBs
to acquire a portion of QLICIs through a put/call option at the end of the seven-year
compliance period, please quantify the value of the investment acquired by the
QALICBs at the end of the seven-year compliance period both as a dollar amount and
as a percentage of total QLICIs.
(Maximum Response Length: 2,000 characters)

TIP: Applicants and/or any Affiliates that have shared Control of a CDE (or subsidiary of a CDE) that is
a prior round Allocatee should answer “Yes” to Question #45 and provide requested responses.
TIP: Applicants providing responses to Question #45 need only make one entry per Allocatee, per
award for which the Applicant has provided QEIs regardless of the number of individual QEIs made to
that Allocatee under a single award. For example, if an Applicant has made 10 QEIs in Allocatee X
under its second round allocation, then the Applicant would provide the aggregate amount of those 10
QEIs in its response to Question #45.

45.

Other than those activities already identified and discussed under Question #44, has the
Applicant and/or any of its Affiliates: i) made a QEI into a CDE (or subsidiary of a CDE)
that received a NMTC Allocation in a prior round; or ii) assumed Control of a CDE that
received a NMTC Allocation in a prior round?
____ Yes

____ No

If Yes, please provide responses to the following:
(a) List the allocation(s) and total QEIs invested per allocation in the table. The Applicant
may use additional space as necessary.
Name of Allocatee:
Award control number:
Total QEI amount invested:
Name of Allocatee:
Award control number:
Total QEI amount invested:

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 41

(b) Discuss the types of transactions that have been financed to date with QEI proceeds,
with particular emphasis on how QEI proceeds were used to finance transactions that
would not likely otherwise have occurred, and any community outcomes or benefits
that were generated as a result of the transactions:
(Maximum Response Length: 5,000 characters).

2013/2014 NMTC Allocation Application
CDFI Fund – Form 1559-0016

Page 42

Exhibit A: Track Record of Activities
Instructions for Exhibit A: Applicants must complete the Tables A1-A4 in Exhibit A for any QLICI-like activities for which the
Applicant has a track record. Applicants must complete Table A5 for any non-QLICI-like activities. An Applicant must provide
information for the past five years or for as many years as the Applicant has been in operation if it has been in operation for fewer
than five years. An Applicant, at its discretion, may choose to rely upon the track record of its Controlling Entity. In order to list the
track record of the Controlling Entity in Exhibit A, the Applicant must designate a Controlling Entity in Question 3. If the
Applicant chooses to complete one table with information from the Controlling Entity, it must also use the Controlling
Entity for Table D1 and Table E2.
TIPs for Exhibit A, Tables 1-4:
1) Where indicated in Tables A1 and A2, enter the dollar amount of debt financing provided by the Applicant (or Controlling Entity)
in row 2a. In row 2b, enter the dollar amount of equity financing provided by the Applicant (or Controlling Entity). Enter all
financing from other sources in row 3. Rows 2 and 4 will automatically calculate based on your entries in rows 2a, 2b and 3.
The Applicant may discuss in Question #17 any role the Applicant (or Controlling Entity) played in leveraging or facilitating
financing it did not originate.
2) For the purpose of completing Tables A1, A2 and A3, the Applicant must choose to either include its own track record or that of
its Controlling Entity’s. If the Applicant chooses to use its own track record it may not include its Controlling Entity’s activities.
However, if the information reflects the activities of the Controlling Entity, it may include, in the aggregate, the track record of all
and any Subsidiaries of the Controlling Entity, including the Applicant. The Applicant may discuss track records of both the
Applicant and Controlling Entity in the narrative to Questions #17. The narrative should clearly distinguish between the track
records of each entity.
3) The Applicant must distinguish between direct financing completed by the Applicant or its Controlling Entity, as indicated in
Table(s) A-1 and A-2, row 2 and financing provided by third party sources, entered in Table(s) A-1 and A-2, row 3.
4) Tables A1-A4 should be mutually exclusive. Applicants should not enter the same data in more than one Table in Exhibit A.
5) Refer to the TIP before Question #13 and Glossary of Terms regarding how to classify Real Estate QALICBs vs. Non-Real
Estate QALICBs. An Applicant that has received prior NMTC Allocations should report track record activities using the definitions
provided in this Round’s Allocation Application, not definitions from previous Allocation Applications.

2013/2014 NMTC Allocation Application
CDFI Fund – Form CDFI 1559-0016

Page 43

The Tables in Exhibit A reflect the activities of (check one):

____Applicant

_____Controlling Entity

Table A1: Track Record of Loans/Investments to Non-Real Estate Businesses

Calendar Year(s)
1
2

4

2009

2010

2011

2012

Totals (2008-2012)

Totals to Nonmetropolitan
Counties
(2008-2012)

Total # businesses financed
Total $ amount of direct financing
provided by the Applicant to nonreal estate businesses

$

$

$

$

$

$

$

$

(a) $ Amount of debt financing
provided by Applicant

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$ Amount of financing provided
by other sources (including
$
QALICB owner equity) to non-real
estate businesses

$

$

$

$

$

$

$

Total $ amount of financing from all
$
sources

$

$

$

$

$

$

(b) $ Amount of equity financing
provided by Applicant
3

2008

Totals to
Disadvantaged
Businesses and
Communities
(2008- 2012)

2013/2014 NMTC Allocation Application
CDFI Fund – Form CDFI 1559-0016

$

Page 44

Table A2: Track Record of Loans/Investments to Real Estate Businesses

Calendar Year(s)
1
2

3
4

Total # businesses financed
Total $ amount of direct financing
provided by the Applicant
(a) $ Amount of debt financing
provided by the Applicant
(b) $ Amount of equity financing
Provided by the Applicant
Total $ Amount provided by other
sources (including QALICB owner
equity)
Total $ amount financing from all
sources

2013/2014 NMTC Allocation Application
CDFI Fund – Form CDFI 1559-0016

2008

2009

2010

2011

2012

Totals (2008-2012)

Totals to
Disadvantaged
Businesses and
Communities
(2008- 2012)

Totals to Nonmetropolitan
Counties
(2008-2012)

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

Page 45

Table A3: Track Record of Loans/Investments to Other CDEs

Calendar Year(s)
1

Total # CDEs financed

2

Total $ amount of financing

2008

2009

2010

2011

2012

Totals (2008-2012)

Totals to
Disadvantaged
Businesses and
Communities
(2008- 2012)

Totals to NonMetropolitan
Counties
(2008-2012)

$

$

$

$

$

$

$

$

3

$ Amount of financing (debt)

$

$

$

$

$

$

$

$

4

$ Amount of financing (equity)

$

$

$

$

$

$

$

$

Table A4: Track Record of Loan Purchases from Other CDEs

Calendar Year(s)
1 Total # of loans purchased
2

Total $ amount of loans purchased

2013/2014 NMTC Allocation Application
CDFI Fund – Form CDFI 1559-0016

2008
$

2009
$

2010
$

2011
$

2012
$

Totals (2008-2012)
$

Totals to
Disadvantaged
Businesses and
Communities
(2008- 2012)

$

Totals to NonMetropolitan
Counties
(2008-2012)

$

Page 46

TIPs for Exhibit A, Table 5:
1) For the purpose of completing Tables A5, the Applicant must choose to either include its own track record or that of its Controlling

Entity’s. If the Applicant chooses to use its own track record it may not include its Controlling Entity’s activities. However, if the
information reflects the activities of the Controlling Entity, it may include, in the aggregate, the track record of all and any subsidiaries of
the Controlling Entity, including the Applicant. The Applicant may discuss track records of both the Applicant and Controlling Entity in
the narrative to Question #18. The narrative should clearly distinguish between the track records of each entity.
2) The Applicant must distinguish between direct financing completed by the Applicant or its Controlling Entity, as indicated in Row 1 and

financing provided by third party sources in Row 2. Data in Row 1 and Row 2 are mutually exclusive. Applicants should not enter the
same data in more than one row.

Table A5: Track Record of Financing Activities that would not qualify as QLICI Activities

Calendar Year(s)

2008

2009

2010

2011

2012

Totals (2008-2012)

Totals to
Disadvantaged
Businesses and
Communities
(2008- 2012)

Totals to Nonmetropolitan
Counties
(2008-2012)

1.

Total $ amount of direct
financing provided by the
Applicant

$

$

$

$

$

$

$

$

2

$ Amount of financing provided
by other sources (including $
QALICB owner equity)

$

$

$

$

$

$

$

3

Total $ amount of financing
from all sources

$

$

$

$

$

$

2013/2014 NMTC Allocation Application
CDFI Fund – Form CDFI 1559-0016

$

$

Page 47

Exhibit B: Projected Activities
Instructions for Exhibit B: All Applicant’s must complete the tables in Exhibit B based on the QLICI activities checked in Question #13.

TIPs for Exhibit B:
1) If the Applicant intends to transfer all or part of its NMTC Allocation to its Subsidiaries, combine the activities of the Applicant and its
Subsidiaries. Only include those activities to be carried out by the Applicant and its Subsidiaries relating to equity raised with NMTCs.
2) Only include amounts the Applicant (or its Subsidiaries) will itself originate (e.g., do not include participation amounts that will be
originated by third-parties). The Applicant may separately discuss amounts it will leverage or facilitate in the narrative to Question #19,
but should clearly distinguish these amounts and should not include them in the tables in Exhibit B.
3) The data included in the tables in Exhibit B, in the aggregate, should not exceed the Applicant’s total allocation request unless the
Applicant intends to invest interest, dividends, or other profits received from QEI proceeds into additional QLICIs. If the Applicant is
pursuing such a strategy of reinvestment, it should be further described in the narrative to Question #19, and listed separately in lines 58 of Tables B1, B2, and B3; lines 5-6 of Table B4; and line 4 of Table B5. Do not consolidate reinvestment data into lines 1-4,
where the Applicant should only discuss original QLICIs.
4) Refer to the TIP in Question #13 and Glossary of Terms regarding how to classify Real Estate QLICBs vs. Non-Real Estate QALICBs.

TIP: Tables B1-B5 should be consistent with the information provided in Question #13.

2013/2014 NMTC Allocation Application
CDFI Fund – Form CDFI 1559-0016

Page 48

Table B1: Projected Loans/Investments to Non-Real Estate QALICBs (Estimated)
Calendar Year(s)
1
Total # transactions to be financed
2

Total $ amount of financing

2014

2015

2016

2017

2018

Total

$

$

$

$

$

$

3

$ Amount of financing (debt)

$

$

$

$

$

$

4

$ Amount of financing (equity)

$

$

$

$

$

$

$

$

$

$

$

$

5

Total # of reinvestment transactions

6

Total $ amount of reinvested financing

7

$ Amount of reinvested financing (debt)

$

$

$

$

$

$

8

$ Amount of reinvested financing (equity)

$

$

$

$

$

$

Table B2: Projected Loans/Investments to Real Estate QALICBs (Estimated)
Calendar Year(s)
1
Total # transactions to be financed
2

Total $ amount of financing

2014

2015

2016

2017

2018

Total

$

$

$

$

$

$

3

$ Amount of financing (debt)

$

$

$

$

$

$

4

$ Amount of financing (equity)

$

$

$

$

$

$

$

$

$

$

$

$

5

Total # of reinvestment transactions

6

Total $ amount of reinvested financing

7

$ Amount of reinvested financing (debt)

$

$

$

$

$

$

8

$ Amount of reinvested financing (equity)

$

$

$

$

$

$

2013/2014 NMTC Allocation Application
CDFI Fund – Form CDFI 1559-0016

Page 49

Table B3: Projected Loans/Investments in Other CDEs (Estimated)
Calendar Year(s)
Total # transactions to be financed
1
2

Total $ amount of financing

2014

2015

2016

2017

2018

Total

$

$

$

$

$

$

3

$ Amount of financing (debt)

$

$

$

$

$

$

4

$ Amount of financing (equity)

$

$

$

$

$

$

5

Total # of reinvestment transactions

6

Total $ amount of reinvested financing

$

$

$

$

$

$

7

$ Amount of reinvested financing (debt)

$

$

$

$

$

$

8

$ Amount of reinvested financing (equity)

$

$

$

$

$

$

Table B4: Projected Loan Purchases from Other CDEs (Estimated)
Calendar Year(s)
1

Total # selling CDEs

2

Total # of loan portfolios purchased

3

Total # of loans purchased

4

Total $ amount of loan purchases

5

Total # of loans purchased via reinvested financing

6

Total $ amount of loans purchased via reinvested
financing

2013/2014 NMTC Allocation Application
CDFI Fund – Form CDFI 1559-0016

2014

2015

2016

2017

2018

Total

$

$

$

$

$

$

$

$

$

$

$

$

Page 50

Table B5: Projected Financial Counseling and Other Services to Businesses and Entrepreneurs in LowIncome Communities (Estimated)
Calendar Year(s)
Total # of businesses/entrepreneurs served
1
through counseling or other services

2014

2015

2016

2017

2018

Total

2

Total estimated hours spent counseling or
providing other services per year

3

Total $ amount to be spent on counseling or
providing other services

$

$

$

$

$

$

4

Total $ amount of reinvestment to be spent on
counseling or providing other services

$

$

$

$

$

$

2013/2014 NMTC Allocation Application
CDFI Fund – Form CDFI 1559-0016

Page 51

Exhibit C: Staff and Board Qualifications
Instructions for Tables C1 and C2: The Applicant should complete Table C1 and Table C2 in their entirety. Please note that Table C1 allows the
Applicant to identify key personnel that have experience in multiple management areas. Applicants are to list no more than 15 individuals in Table C1.
Application reviewers will be instructed to evaluate only the initial 15 individuals listed in Table C1 for scoring purposes. For each narrative response in
Questions #29-31 and their corresponding sub sections, reference and discuss the combined management experience of all individuals listed in Table
C1 as it relates to the Applicant’s management capacity in that given area. An Applicant must also identify any consultant(s) contracted to write either
portions or the entirety of their Allocation Application.

Table C1: Management Capacity
Name

Firm

Type of activity with Applicant in
each Capacity
(Check all that apply)

Title at
Firm

__ NMTC Application Preparation/Review
__ Capital-raising
__ Capital deployment
__ Sourcing or loan underwriting
__ Asset management
__ Loan servicing
__ NMTC Program compliance
__ Provision of services to QALICBs /
residents (including FCOS)
__ Community Outreach
__ Legal services
__ Other: _____________

2013/2014 NMTC Allocation Application
CDFI Fund – Form CDFI 1559-0016

Yrs. with (or
years providing
services to) the
Applicant

Position with Applicant
(Check all that apply)
__ Governing board (GB) chair
__ GB member on loan/investment
committee
__ Other GB member
__ Advisory board member
__ Executive Director or equivalent
__ Chief Financial Officer or equivalent
__ Dir. of Lending/investing or equivalent
__ Other key management
__ Loan/investment Officer or equivalent
__ Compliance Officer
__ Other finance staff
__ Contracted consultant
__ Other (specify):______________

Description of
Individuals
Qualifications
Description of
Individual’s qualifications
should include years of
relevant experience and
how this experience is
similar to the individual’s
role in managing the
Applicant’s NMTC
program. (Maximum
Response Length: 2000
characters)

Page 52

Table C2: Low-Income Community Accountability
Board
Member
Name

Firm

Title at
Firm

Advisory or
Governing
Board
Member?

Yrs. on
Board

Indicate how the individual is
Representative of Low-Income
Communities?

__ Advisory

__ Resident

__ Governing

__ Small business owner
__ Employee or board member of a non-Affiliated
community-based or charitable organization
__ Religious leader whose congregation is based
in a Low-Income Community

Description of the Individual’s
Qualifications as an LIC
representative, including related LIC
community affiliations or
experiences.
Description should focus on the
representative’s years and depth of
experience serving, working in, living in,
or operating a business in LICs.
(Maximum Response Length: 2000
characters)

__ Employee of a governmental agency or
department that principally serves Low-Income
Communities
__ An elected official (or works for one) whose
constituency is comprised principally of
residents of Low-Income Communities
__ Other (specify):________________

2013/2014 NMTC Allocation Application
CDFI Fund – Form CDFI 1559-0016

Page 53

Exhibit D: Asset Management and Income & Operating Expenses
Instructions for Table D1: For each of the past three fiscal years, indicate the total number and dollar amount of loans and equity investments
outstanding to both non-real estate and real estate businesses. For each fiscal year end, report in rows 4 and 9 the percentage of loans and mandatory
dividend payments, on a dollar basis, that were 90 days past due (e.g., the combined dollar amount of principal, mandatory dividend, and interest
payments 90 days or more past due / the total dollar amount of loans and equity investments outstanding at fiscal year-end). In rows 5 and 10, enter the
total dollar amount of capital from loans and equity investments written off during the fiscal year (e.g., total dollar value of loans and/or equity investments
written off less capital recovered). If the Applicant (or Controlling Entity) has not made loans to either non-real estate or real estate businesses, check
the corresponding “N/A” box. If the Applicant (or Controlling Entity) has no delinquencies at the end of a particular fiscal year, indicate “0” in lines 4 and
9, as appropriate. If the Applicant (or Controlling Entity) has had no write offs of loans and/or equity during a particular fiscal year, indicate “0” in lines 5
and 10, as appropriate. If the Applicant chooses to complete one table with information from the Controlling Entity, it must do so for

all Tables where Controlling Entity is an option.

The information in Table D1 reflects the activities of (check one):

____Applicant

_____Controlling Entity

Table D1: Investment Portfolio
Fiscal Year(s)
1.

Non Real Estate Business Loans & Equity Investments Delinquent or written-off

2.

# of loans & equity investments outstanding

3.

Total $ Amount of loans & equity investments outstanding

4.

Delinquency rate associated with non-real estate businesses

5.

Total $ amount of write-offs of loans & equity investments to
non-real estate businesses

6.

$

# of loans & equity investments outstanding

8.
9.

Total $ amount of loans & equity investments outstanding

$

2013/2014 NMTC Allocation Application
CDFI Fund – Form CDFI 1559-0016

____%

____%
$

 N/A
$

____%
$

$

$

$

FYE 2012

 N/A

____%

Delinquency rate associated with real estate businesses
Total $ amount of write-offs of loans & equity investments to
real estate businesses

FYE 2011

$

Real Estate Businesses Loans & Equity Investments Delinquent or written-off

7.

10.

FYE 2010

$
____%

$

____%
$

Page 54

Instructions for Table D2: All Applicant’s must complete Table D2. Applicants should ensure that data entered into Table D2 takes into

consideration the projected loans and investments listed in Exhibit B: Projected Activities. Applicants should assume that NTMC Allocation
awards will be made in spring 2014. Applicants must provide an explanation of Table D2 in response to Question #34(e). The information
in Table D2 must reflect the projected income and operating expense of the Applicant.
1. When entering income data by source, the Applicant must include any and all fees and other sources of compensation that the
Applicant and/or its Affiliates will charge:
a. Investors (including investment partnership funds, if using the leverage structure). Be sure to include QEI proceeds retained by
the Applicant, Controlling Entity or its subsidiary CDEs;
b. QALICBs (i.e. borrowers/investees) fees and other sources of compensation paid directly to the CDE, including interest
income;
c. Affiliates, including the Controlling Entity or subsidiary CDEs; and
d. Other sources of revenue, including grants, contributions, consulting, other line(s) of business, etc.
2. When entering expenses:
a. Fixed Expenses are expenses incurred by Applicant that are unlikely to vary regardless of the amount of the NMTC Allocation
award or size and number of QLICIs considered or made. For example, staff, facilities, Board/Insurance, CDE audit, etc.
b. Variable Expenses are all other expenses incurred by the Applicant, including compliance, accounting, tax returns, sub-CDE
audits, loan servicing, etc.
3. Data should be stated in dollars by fiscal year, starting with the fiscal year 2014.

2013/2014 NMTC Allocation Application
CDFI Fund – Form CDFI 1559-0016

Page 55

Table D2: Income and Operating Expenses
Fiscal Year
2014

2015

2016

2017

2018

2019

2020

After 2020

1. Income by source:
(a) Investor(s)
(b) QALICBs
(c) Affiliates
(d) Other Sources
Total Income

$

$

$

$

$

$

$

$

Total Expenses

$

$

$

$

$

$

$

$

Profit/(Loss)

$

$

$

$

$

$

$

$

2. Expenses:
(a) Fixed
(b) Variable

2013/2014 NMTC Allocation Application
CDFI Fund – Form CDFI 1559-0016

Page 56

Exhibit E: Investor Strategy
TIPs for Exhibit E:
1) Applicants completing Table E1 are required to submit, along with their applications, documentation demonstrating proof of investor interest (e.g.,
proof of QEI issuance; Commitment letters; Letters of Interest/Intent). For examples of acceptable documentation for the required information, refer
to the CDFI Fund’s NMTC Allocation Application Q&A Document. Be sure to refer to the Applicant Instructions for information regarding the
submission of these documents.
2) If an Applicant received a previous NMTC Allocation, it should not include in Table E1 investors that provided QEIs pursuant to the Applicant’s
previous NMTC Allocation Awards unless such investors are providing new QEIs and/or Commitments distinct from the QEIs or Commitments
pertaining to the Applicant’s previous NMTC Allocation Awards.
3) In Table E2, an Applicant may, at its discretion, rely upon the track record of its Controlling Entity. In order to list the track record of the
Controlling Entity in Table E2, the Applicant must designate a Controlling Entity in Question #3. If the information reflects the Controlling
Entity, it may include in aggregate the track record of any and all Subsidiaries of the Controlling Entity, including the Applicant. If the Applicant

chooses to complete one table with information from the Controlling Entity, it must do so for all Tables where Controlling
Entity is an option.

Instructions for Table E1: In Table E1, Applicants should only list the names of actual or prospective investors that have provided Equity Investments
(in accordance with applicable IRS rulings regarding the issuance of QEIs prior to notification of an allocation), Commitments, or Letters of Interest/Intent
in connection with a potential NMTC Allocation. To the extent an Applicant has or intends to secure investments from partnership entities that will
leverage non-Equity Investments (e.g., debt, grant dollars), such investments should be separately reported under “Type of Investment”. If an Applicant
plans to engage an investment banker (or other third party) to raise equity capital on the Applicant’s behalf, DO NOT INCLUDE such third party
organizations in this table.

2013/2014 NMTC Allocation Application
CDFI Fund – Form CDFI 1559-0016

Page 57

Table E1: Identification of Investments and Investor Commitments

Name of
Investor
1
2
3
4
5

TOTAL

Type of
Investment1

N/A

Using
Leverage
Structure
?
Yes/No
Yes/No
Yes/No
Yes/No
N/A

Unrelated
Entity?
Yes/No
Yes/No
Yes/No
Yes/No
N/A

Previous
Investor?2
Yes/No
Yes/No
Yes/No
Yes/No
N/A

Total Funding
Provided from 20082012 (if previous
investor)
$
$
$
$
$

Dollar
Amount
Sought
$
$
$
$
$

Status of
Request3

Estimated
or Actual
Date for
Receipt of
Funds

N/A

N/A

1

Debt, equity, or grant.
2
A previous investor is any investor that has invested in the Applicant, its Controlling Entity, or any Subsidiary entities since 2008.
3
Funds have been received; investor provided Commitment; investor issued Letter of Interest/Intent.

Table E2: Track Record of Raising Capital from Investors
This table reflect the activities of (check one):
Calendar Year(s)
1
Total # of investments
2
Total $ amount of investments
3
Total # of grants1
4
Total $ amount of grants2
5
Total # of below market rate loans1
6
Total $ amount of below market rate loans2
7
Total # of market rate loans1
8
Total $ amount of market rate loans2
9
Total # of Equity Investments1
10
Total $ amount of Equity Investments 2

_____Applicant

_____Controlling Entity
2008

2009

2010

2011

2012

Total

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

$

1

Values should be a subset of Line 1.
2
Values should be a subset of Line 2.

2013/2014 NMTC Allocation Application
CDFI Fund – Form CDFI 1559-0016

Page 58

Glossary of Terms
Affiliate
Allocatee

Any legal entity that Controls, is Controlled by, or is under
common Control with, the Applicant.
An Applicant that receives a NMTC Allocation.

Allocation Agreement

An agreement to be entered into by the CDFI Fund and a
CDE, relating to the NMTC Allocation, pursuant to IRC
§45D(f)(2).

Allocation Application

The application form, issued by the CDFI Fund pursuant to
a Notice of Allocation Availability (NOAA), to be completed
and submitted by an Applicant in order to be considered for
a NMTC Allocation.

Applicant

Any legal entity that is applying to the CDFI Fund for the
receipt of a NMTC Allocation. This term includes any
Subsidiary of the Applicant, which may receive a transfer of
all or part of a NMTC Allocation from the Applicant.

Application Contact Person

The individual that the CDFI Fund may contact during the
course of the Allocation Application review with questions
or requests for additional information regarding the
Allocation Application.

Assistance Agreement

A written agreement between the CDFI Fund and an entity
receiving assistance under the CDFI Program and Native
American CDFI Assistance (NACA) Program, specifying
the terms and conditions of assistance including, without
limitation, performance and financial soundness goals, if
applicable. See 12 CFR §1805.104(f).

Authorized Representative

An officer, or other individual, who has the actual authority
to sign for and make representations on behalf of the
Applicant. This person will also be the primary point of
contact for the Applicant.

CDE Certification Application

The application form, issued by the CDFI Fund, to be
completed and submitted by an entity in order to be
certified as a CDE.

Commitment

A document in which an investor commits to make an
investment in the Applicant in a specified amount and on
specified terms.

2013/2014 NMTC Allocation Application
CDFI Fund – Form CDFI 1559-0016

Page 59

Community Development
Entity (CDE)

Under IRC §45D(c)(1), any domestic corporation or
partnership if:
(1) The primary mission of the entity is serving, or
providing investment capital for, Low-Income
Communities or Low-Income Persons;
(2) The entity maintains accountability to residents of
Low-Income Communities through their
representation on any governing board of the entity
or on any advisory board to the entity; and
(3) The entity is certified by the CDFI Fund as a CDE.
Specialized Small Business Investment Companies
(SSBICs) and Community Development Financial
Institutions (CDFIs) are deemed to be CDEs in the
manner set forth in Guidance published by the
CDFI Fund (66 Federal Register 65806, December
20, 2001).

Community Development
Financial Institution (CDFI)

An entity that has been certified by the CDFI Fund as
meeting the criteria set forth in section 103 of the
Community Development Banking and Financial
Institutions Act of 1994 (12 U.S.C. 4702). For further
details, refer to the CDFI Program regulations set forth at
12 CFR 1805.201.

Community Investment
Impact System (CIIS)

A web-based data collection system that CDFIs and CDEs
will use to submit their Institution-Level Reports and
Transaction-Level Reports to the CDFI Fund.

Control

For purposes of this application is defined as:
(1) Ownership, control, or power to vote more than 50
percent of the outstanding shares of any class of
voting securities of any entity, directly or indirectly
or acting through one or more other persons; or
(2) Control in any manner over the election of a
majority of the directors, trustees, or general
partners (or individuals exercising similar functions)
of any other entity; or
(3) Power to exercise, directly or indirectly, a controlling
influence over the management policies or
investment decisions of another entity, as
determined by the CDFI Fund.

2013/2014 NMTC Allocation Application
CDFI Fund – Form CDFI 1559-0016

Page 60

Controlling Entity

An entity that Controls an Applicant, and has a controlling
influence over the day-to-day management and operations
(including investment decisions) of the Applicant and of
any Subsidiary entities to which the Applicant may transfer
its allocation of tax credit authority. When describing past
activities of the Controlling Entity, the activities of the
Applicant may be considered as part of the track record of
the Controlling Entity.

Controlling Entity
Representative

An officer, or other individual, who has the actual authority
to sign for and make representations on behalf of the
Controlling Entity. This person will also be the primary
point of contact for the Controlling Entity, should the CDFI
Fund need to confirm representations made about the
relationship between the Applicant and Controlling Entity.

Disadvantaged Business

A business that is (a) located in a Low-Income Community;
or (b) is owned by a Low-Income Person; or (c) a business
that has inadequate access to investment capital.

Disadvantaged Community

This term has the same meaning as a Low-Income
Community.

Enforcement Action

A legally enforceable action or administrative order taken
by a federal regulator (FDIC, OCC, NCUA) when a
regulated financial institution is found to be in an
unsatisfactory condition (e.g. violations of laws, rules or
regulations, final orders or conditions imposed in writing;
unsafe or unsound practices; and for breach of fiduciary
duty by institution-affiliated parties).

Equity Equivalent Loan

A loan that has certain equity-like provisions, including
required principal and interest payments only from cash
flow and a flexible maturity date. Note that the definition of
this term under the CDFI Program and NMTC Program is
more flexible than the definition of the same term under the
Bank Enterprise Award (BEA) Program.

Equity Investment

Under IRC §45D(b)(6) and the NMTC Program Income Tax
Regulations, Equity Investment means any stock (other
than nonqualified preferred stock as defined in IRC
§351(g)(2)) in an entity that is a corporation and any capital
interest in an entity that is a partnership.

Financial Counseling and
Other Services (FCOS)

Advice provided by a CDE relating to the organization or
operation of a trade or business. See 26 CFR 1.45D1(d)(7).

2013/2014 NMTC Allocation Application
CDFI Fund – Form CDFI 1559-0016

Page 61

Food Desert

A low-income census tract where a substantial number or
share of residents has low access to a supermarket or
large grocery store.
Census tracts qualify as food deserts if they meet lowincome and low-access thresholds established by the
USDA and can be found using the Food Access Research
Atlas at http://www.ers.usda.gov/data-products/foodaccess-research-atlas.aspx

FTE

A full time equivalent (FTE) is at least a 35-hour work
week.

Letter of Interest/Intent

A document in which an investor expresses a preliminary
interest in making an investment in the Applicant.

Low-Income Community
(LIC)

Under IRC §45D(e)(1), any population census tract if:
(1) The poverty rate for such tract is at least 20
percent, or
(2) (a) In the case of a tract not located within a
metropolitan area, the median family income for
such tract does not exceed 80 percent of statewide
median family income, or (b) in the case of a tract
located within a metropolitan area, the median
family income for such tract does not exceed 80
percent of the greater of statewide median family
income or the metropolitan area median family
income.
With respect to IRC §45D(e)(1)(B), possession-wide
median family income shall be used (in lieu of statewide
income) in assessing the status of census tracts located
within a possession of the United States.
Under IRC §45D(e)(2), Targeted Populations will also be
treated as Low-Income Communities. See IRS Notice
2006-60.
Under IRC §45D(e)(3), in the case of an area that is not
tracted for population census tracts, the equivalent county
divisions (as defined by the Bureau of the Census for
purposes of determining poverty areas) shall be used for
purposes of defining poverty rates and median family
incomes. See IRC §45D(e) for additional criteria.

2013/2014 NMTC Allocation Application
CDFI Fund – Form CDFI 1559-0016

Page 62

Low-Income Person

Any individual having an income, adjusted for family size,
of not more than:
(1) For metropolitan areas, 80 percent of the area
median family income; and
(2) For non-metropolitan areas, the greater of (a) 80
percent of the area median family income or (b) 80
percent of the statewide non-metropolitan area
median family income.

Minority-owned or Minoritycontrolled

Minority-owned for-profit entity: A for-profit entity that is not
a MDI and that has at least 51 percent of its equity
ownership interest being owned by individuals who identify
themselves as Black American, Asian American, Hispanic
American, or Native American.
Minority-controlled not-for-profit entity: A not-for-profit
entity with at least 51 percent of its Board of Directors
comprised of individuals who identify themselves as Black
American, Asian American, Hispanic American, or Native
American.
Minority Depository Institution (MDIs): An entity that is
designated by the FDIC as a Minority Depository
Institution.

New Markets Venture Capital
Company (NMVCC)

An entity designated as a NMVCC by the Small Business
Administration under the New Markets Venture Capital
Company Program. See 13 CFR 108.10 for more
information.

Non-Metropolitan Counties

Counties not contained within a Metropolitan Statistical
Area, as such term is defined in OMB Bulletin No. 10-02
(Update of Statistical Area Definitions and Guidance on
Their Uses) and applied to the 2010 census tracts.

Non-Real Estate QALICB

“Non-Real Estate Qualified Active Low-Income Community
Business” or “Non-Real Estate QALICB” shall mean any
Qualified Active Low-Income Community Business that
does not satisfy the definition of Real Estate QALICB.

Notice of Allocation

Notification to the Allocatee from the CDFI Fund which
informs the Allocatee of its receipt of a NMTC Allocation
subject to the terms and conditions set forth in the notice
(see applicable NOAA).

2013/2014 NMTC Allocation Application
CDFI Fund – Form CDFI 1559-0016

Page 63

Notice of Allocation
Availability (NOAA)

A document published by the CDFI Fund in the Federal
Register that provides specific guidance on how a CDE
may apply for a NMTC Allocation, the competitive
procedure through which such allocations will be made,
and the actions that will be taken by the CDFI Fund to
ensure that proper allocations are made to appropriate
entities. The NOAA published in conjunction with the
combined 2013 & 2014 Allocation Application will only
apply to the Round.

NMTC Allocation

An allocation of tax credit authority pursuant to the New
Markets Tax Credit Program.

NMTC Program Income Tax
Regulations

The regulations promulgated by the Internal Revenue
Service which provide guidance for taxpayers claiming the
New Markets Tax Credit under IRC §45D. See 26 CFR
1.45D-1 for more information.

Postmark

As defined by 26 CFR 301.7502-1. In general, the CDFI
Fund will require a postmark date that is on or before the
applicable deadline. The document must be in an
envelope or other appropriate wrapper, properly addressed
and deposited in the U.S. mail. The document may be
delivered by the United States Postal Service or any other
private delivery service designated by the Secretary of the
Treasury. For more information on designated delivery
services, please see IRS Notice 2002-62, 2002-2 C.B.574

Public Contact Person

The individual that will field public inquiries (i.e. from
potential QALICBs) if the Applicant is selected to receive
an NMTC Allocation. This contact information will be
published as part of the Award Announcement for the
NMTC Allocation round and available to the public in the
CDFI Fund’s monthly QEI Issuance Report.

2013/2014 NMTC Allocation Application
CDFI Fund – Form CDFI 1559-0016

Page 64

Qualified Active Low-Income
Community Business
(QALICB)

Under IRC §45D(d)(2), any corporation (including a nonprofit corporation) or partnership if for any taxable year:
(1) At least 50 percent of total gross income of such
entity is derived from the active conduct of a
qualified business within any Low-Income
Community;
(2) A substantial portion of the use of the tangible
property of such entity (whether owned or leased) is
within any Low-Income Community;
(3) A substantial portion of the services performed for
such entity by its employees are performed in any
Low-Income Community;
(4) Less than 5 percent of the average of the aggregate
unadjusted bases of the property of such entity is
attributable to collectibles (as defined in IRC
§408(m)(2)) other than collectibles that are held
primarily for sale to customers in the ordinary
course of such business; and
(5) Less than 5 percent of the average of the aggregate
unadjusted bases of the property of such entity is
attributable to nonqualified financial property (as
defined in IRC §1397C(e)).
Please refer to the NMTC Program Income Tax Regulations at
26 CFR 1.45D-1(d)(4) for more information.

Qualified Equity Investment
(QEI)

Under IRC §45D(b)(1), any Equity Investment in a CDE if:
(1) Such investment is acquired by the investor at its
original issue (directly or through an underwriter)
solely in exchange for cash;
(2) Substantially all of such cash is used by the CDE to
make QLICIs; and
(3) The investment is designated for purposes of IRC
§45D by the CDE as a QEI. QEI also includes an
Equity Investment purchased from a prior holder, to
the extent provided in IRC §45D(b)(4).
QEI does not include any Equity Investment issued by a
CDE more than five years after the date the CDE receives
a NMTC Allocation. Please refer to the NMTC Program
Income Tax Regulations at 26 CFR 1.45D-1(c) and related
Internal Revenue Service notices for more information.

2013/2014 NMTC Allocation Application
CDFI Fund – Form CDFI 1559-0016

Page 65

Qualified Low-Income
Community Investments
(QLICI)

Under IRC §45D(d)(1), a QLICI is:
(1) Any capital or Equity Investment in, or loan to, any
QALICB (as defined in IRC§45D(d)(2));
(2) The purchase from a CDE of any loan made by
such entity that is a QLICI;
(3) Financial Counseling and Other Services to
businesses located in, and residents of, LowIncome Communities; and
(4) Any Equity Investment in, or loan to, any CDE.
Please refer to the NMTC Program Income Tax Regulations at
26 CFR 1.45D-1(d)(1) for more information.

Real Estate QALICB

“Real Estate Qualified Active Low-Income Community
Business” or “Real Estate QALICB” shall mean any
QALICB whose predominant business activity (i.e. activity
that generates more than 50 percent of the business’ gross
income) includes the development (including construction
of new facilities and rehabilitation/enhancement of existing
facilities), management, or leasing of real estate.

Rural CDE

A Rural CDE is one that has a track record of at least three
years of direct financing experience, has dedicated at least
50 percent of its direct financing dollars to NonMetropolitan Counties over the past five years, and has
committed that at least 50 percent of its NMTC financing
dollars with this Allocation will be deployed in such areas.
Non-Metropolitan counties are counties not contained
within a Metropolitan Statistical Area, as such term is
defined in OMB Bulletin No. 10–02 (Update of Statistical
Area Definitions and Guidance on Their Uses) and applied
using 2010 census tracts.

Small Business Investment
Company (SBIC)

An entity defined in 15 USC 662(3).

Specialized Small Business
Investment Company
(SSBIC)

An entity defined in IRC §1044(c)(3).

Subsidiary

Any legal entity that is owned or Controlled directly or
indirectly by an Applicant. This term includes series funds,
which are separate investment funds Controlled by an
Applicant.

2013/2014 NMTC Allocation Application
CDFI Fund – Form CDFI 1559-0016

Page 66

Targeted Population

As defined in 12 U.S.C. 4702(20) and 12 C.F.R. 1805.201,
the term “targeted population” means individuals, or an
identifiable group of individuals, including an Indian Tribe,
who (A) are Low-Income Persons; or (B) otherwise lack
adequate access to loans or investments.

Unrelated

Persons who are not related within the meaning of IRC
§267(b) or IRC §707(b)(1).

2013/2014 NMTC Allocation Application
CDFI Fund – Form CDFI 1559-0016

Page 67