‘An Incredibly Useful Tool’

For a number of the 1,900-plus attendees at the 2024 Main Street Now Conference, Regions Bank’s Steve Ross knows the secret sauce to helping with economic redevelopment.

Based in Washington, D.C., Ross is the New Markets Tax Credit (NMTC) lead. He and his team help others find their economic wheelhouse across the bank’s footprint.

New Markets Tax Credits are arrows in the arsenal for local Main Street communities, focusing on growth that needs a little extra help to prosper.

“NMTC financing is really gap financing for commercial projects in low-income communities,” Ross said at the conference, which is ongoing in downtown Birmingham this week. “In reality, it helps successful organizations become more successful by providing access to capital.”

During a 30-minute conversation with Main Street members from across the country that spilled over with numerous questions after, Ross put the benefit of New Markets Tax Credits in terms everyone could understand.

NMTC financing is really gap financing for commercial projects in low-income communities. In reality, it helps successful organizations become more successful by providing access to capital.Steve Ross, New Markets Tax Credit lead

“You are benefitting from low-cost capital,” he said. “And the government wants to ensure that your project is impacting a low-income community.”

That project could mean mixed-use affordable housing, healthcare, or a new grocery store in a food desert. It could also mean taking existing empty property and repurposing it so the local mom-and-pop market can expand.

Justin Washington is a fellow for the Economic Recovery Corps. Based in Fairfield, just to the west of downtown Birmingham, the Tuscaloosa native said it’s important for him to see local communities flourish.

“With me being from Alabama, I’ve always had interest in this type of work,” Washington said. “Sessions like the one Steve is leading are so important because they are pieces to help solving complex issues we all face.”

Washington and the Economic Recovery Corps are currently working with Miles College to address critic redevelopment needs and foster commercial revitalization in economically stressed communities.

“Typically, the threshold for a New Markets Tax Credit is $5-million-plus,” Washington said. “But I’m learning that there is appetite for smaller projects.”

That’s the point Ross wanted to get across.

“You have to ask, is the juice worth the squeeze?” Ross said. “We see a lot of projects that are smaller – a half-million to just a few million dollars. In fact, the government advocates for smaller projects and gives priority points to CDEs (Community Development Entities) for financing small projects, or projects in rural areas.”

The key for local Main Street leaders: get to know your local Community Development Entities and your local bankers. They can work hand-in-hand in finding the right project and matching it with existing capital.

Above all, though, be patient.

“The New Markets Tax Credit is an incredibly useful tool, but it can be intimidating and frustrating,” Ross said.

Ross’ seminar was one of dozens across the three-day conference, held at the Birmingham-Jefferson Convention Complex in Main Street’s first national visit to the city. Regions Bank is the presenting sponsor of 2024 Main Street Now.