Harbor Bank of Maryland received $70 million in tax credits this week from the Treasury Department under the New Market Tax Credit Program(NMTC), intended to spur revitalization efforts of low-income communities across the United States.
The $70 million allocation to Harbor Bankshares Corporation, the holding company of Harbor Bank of Maryland, represents the largest award granted to a minority institution since the New Markets Tax Credit Program was enacted by Congress in 2000.
Harbor Bank will use the award to further increase financing projects that create jobs, provide critical community services and support the revitalization of impoverished communities, according to Joseph Haskins, Chairman, president and CEO of Harbor Bankshares Corporation.
“Harbor has established itself as an innovative financial institution that is passionate about supporting minority and low-income communities,” Haskins said.
The New Market Tax Credit program incentivizes business and real estate investment in low-income communities, according to the Rev. Jerome Stephens, a field representative for Maryland Senator Ben Cardin.
Harbor Bank is a Certified Community Development Financial Institution, a Treasury Department designation awarded to financial institutions that support inner-core communities across its service area. Harbor is also a certified Community Development Entity, a designation that allows the bank to serve as an intermediary vehicle for the provision of loans, investments, or financial counseling in low-income communities.
“A Community Development Entity must have a primary mission of investing in low-income communities and persons,” Stephens said.
‘We are proud that the Fund continues to recognize Harbor’s excellence in investing in underserved communities by providing vital capital to create jobs and housing solutions that strengthen communities,” said Haskins.
Harbor has received six allocations of New Markets Tax Credit funding, totaling $244 million, since the federal program began. Harbor’s NMTC investments in education-based community facilities have advanced the education of 1,940 low-income youth, and enabled workforce training and development to more than 500 unemployed/underemployed workers annually. Harbor’s NMTC investments have funded rehabilitation of 257 affordable housing units in low-income communities in the Baltimore-Washington Metropolitan Area, according to Haskins.
120 financial institutions in 36 states, the District of Columbia and Puerto Rico were awarded $7 billion in tax credits by the Treasury Department in the program’s 2015-2016 funding round, announced Nov. 17.
Historically, New Markets Tax Credit awards have generated $8 of private investment for every dollar invested by the federal government. Since 2001, NMTCs have generated more than $42 billion in investments in low-income communities and businesses, resulting in the creation or retention of more than 500,000 jobs, and the construction or rehabilitation of more than 164 million square feet of commercial real estate.