CDFI Fund Opens $5 Billion New Markets Round

On September 15, 2026, the U.S. Department of the Treasury's Community Development Financial Institutions Fund (CDFI Fund) published the calendar year (CY) 2026 Notice of Allocation Availability (NOAA) for the New Markets Tax Credit (NMTC) in the Federal Register, offering $5 billion in allocation authority. It is the first round since the One Big Beautiful Bill Act (OBBBA), Public Law 119-21, signed July 4, 2025, made the program permanent. Applications are due at 5:00 p.m. ET on November 10, 2026, and every applicant must first complete the Application Registration in the CDFI Fund's Awards Management Information System (AMIS) by 5:00 p.m. ET on October 6, 2026.

The NOAA came one month after the CDFI Fund's August 12, 2026 advance notice telling prospective applicants to get ready, and three weeks after Treasury announced Chris Miller, who comes from Three Roots Capital, a certified CDFI in Knoxville, Tennessee, as Director of the CDFI Fund on August 25, 2026. It leaves eight weeks from publication to the November 10 application deadline.

How the Credit Works

The NMTC converts a 39% federal credit into below-market capital for low-income communities. Codified at IRC Section 45D, the program gives investors a federal tax credit equal to 39% of a qualified equity investment (QEI) in a certified CDE, claimed over seven years: 5% of the investment in each of the first three years and 6% in each of the final four. The CDE must deploy substantially all of the QEI proceeds into qualified low-income community investments (QLICIs), typically loans to or equity investments in operating businesses and real estate projects in census tracts with poverty rates of at least 20% or median family income at or below 80% of the area benchmark. Credits are subject to recapture throughout the seven-year compliance period. Novogradac reports no known recapture events in the history of the credit.

Exhibit 1 works through the credit on a $10 million QEI. For a $10 million QEI supporting a rural manufacturing facility's QLICI financing, the investor's credit totals $3.9 million.

That credit stream is what allows NMTC financing to reach projects as patient capital. Per the CDFI Fund's summary report released August 7, 2026, covering fiscal years 2003 through 2023, allocatees directed $71 billion in NMTC investments to 8,439 qualified active low-income community businesses. The program financed over 268 million square feet of commercial real estate, put $30 billion into community facility projects, and supported more than 888,000 actual jobs, with more than 125,000 additional jobs projected. The CDFI Fund's program page says the NMTC has generated $8 of private investment for every $1 of federal funding.

What the CY 2026 NOAA Requires

Two gating deadlines come before the application deadline. Under the NOAA's Table 1, an applicant that has not completed and saved the AMIS Application Registration by 5:00 p.m. ET on October 6, 2026 "will not be able to subsequently submit" an allocation application. Likewise, an entity that is not already certified as a CDE must submit its CDE Certification Application in AMIS by 11:59 p.m. ET on September 22, 2026. The Fund's August 12 advance notice had set that certification cutoff at August 31, and the NOAA extended it. Subsidiary CDE certification requests and service-area modification requests share the September 22 date, and amendment requests for subsidiary CDEs or controlling entities are due November 3, 2026. The last day to contact CDFI Fund staff with questions is November 6, 2026.

Applications are submitted only through AMIS, one per applicant and its affiliates. The NOAA states that "an Applicant and its Affiliates must collectively submit only one Allocation Application." Hard copy, fax, and email submissions are not accepted.

Scoring rewards business strategy and community outcomes equally, with priority points on top. Phase 1 review scores each application on Business Strategy (25 points) and Community Outcomes (25 points), and applicants must clear minimum thresholds in both to advance. Up to 10 additional priority points are available: up to five for "a record of having successfully provided capital or technical assistance to disadvantaged businesses or communities," and five for intending to invest substantially in businesses in which persons unrelated to the applicant hold the majority equity interest. Phase 2 ranks applicants by combined score and sets award amounts after considering management capacity, capitalization strategy, and prior performance. The Fund will deduct up to five points from the rank score of any applicant (or affiliate) that missed a reporting deadline between January 30, 2025 and the application deadline.

Prior allocatees must hit QEI issuance thresholds by January 7, 2027. Exhibit 2 shows the thresholds by prior allocation year.

QEIs must be reported and QLICIs certified in AMIS by January 14, 2027. Applicants with a final CDFI Fund determination of noncompliance or default are ineligible, as are those that default on a prior Allocation Agreement in the period from 12 months before the application deadline through the CY 2026 award announcement, or that defaulted on a CDFI Fund loan within five years of the deadline.

The rural goal is written into the NOAA. The Fund states it will "endeavor to ensure that 20 percent of the QLICIs to be made using QEI proceeds are invested in Non-Metropolitan counties." An applicant qualifies as a Rural CDE, and gets the lower QEI thresholds above, if it has at least three years of direct financing experience, has dedicated at least 50% of its direct financing dollars to non-metropolitan counties over the past five years, and commits at least 50% of its NMTC financing to those areas.

Anti-discrimination compliance is now an Allocation Agreement covenant. Consistent with Treasury's December 2025 reform announcement, the NOAA provides that each allocatee must not, "to the best of its knowledge after reasonable diligence," make a QLICI in a business that violates applicable federal anti-discrimination laws, and must "adopt, implement, and maintain policies and procedures reasonably designed to ensure" compliance. There is no right to appeal the Fund's allocation decisions.

What Permanence Changes for Pipeline Planning

CDEs and sponsors can now plan across annual rounds. Before OBBBA, the program had been extended in one- to five-year increments since 2000. The CY 2024-2025 round combined two years of authority into a single $10 billion round. With $5 billion available every year, CDEs can sequence applications annually, investors can commit to multi-year platforms, and sponsors with projects that miss one round have a predictable next window.

Unused authority now lapses after five years. Under amended IRC Section 45D(f)(3), unused annual limitation still rolls forward, but no amount may be carried "to any calendar year after the fifth calendar year after the calendar year in which the excess ... occurred," and "any excess ... with respect to any calendar year before 2026 shall be treated as occurring in calendar year 2025." The amendments apply to calendar years beginning after December 31, 2025. The rule it replaced barred any carryover to a calendar year after 2030.

Permanence left out two changes the industry sought. OBBBA did not index the $5 billion authorization to inflation, a proposal dropped in conference, and did not exempt the credit from the alternative minimum tax, as had been considered. The NMTC Coalition had sought both changes in the NMTC Extension Act.

What the Last Round Suggests About This One

The CY 2024-2025 cycle set records that the permanent-era cadence will be measured against. According to the CDFI Fund's award book, 216 applicants requested $19.2 billion and 142 received allocations totaling $10 billion, ranging from $20 million to $95 million. Novogradac puts the average award at more than $70 million, the highest in the credit's history. Awards were announced December 23, 2025, roughly 11 months after the January 29, 2025 application deadline. Exhibit 3 shows how the awards split by geography.

Treasury counts a 20 percent increase in rural investment, and rural projects remain a stated priority. Treasury described the CY 2024-2025 awards as "a 20 percent increase in investments in rural and non-metro communities." Twenty-four allocatees qualified as rural CDEs, and 68 committed to deploy the $2.42 billion in rural areas. Of the 142 allocatees, 137 pledged at least 20% of their QLICIs to deep-distress areas, an estimated $2.65 billion. Treasury said the next cycle would emphasize affordable housing development, small business growth and expansion, domestic manufacturing and job-producing projects, and rural hospitals and essential community health infrastructure. The CY 2026 NOAA's rural CDE definition and 20% non-metropolitan goal carry the rural priority forward.

Compliance stakes are higher. In its December 23, 2025 announcement, Treasury said it would modify Allocation Agreements to strengthen permitted-use provisions, enhance monitoring, and, in cases of noncompliance, pursue remedies including decertification of the CDE, termination of unused allocations, and recapture of past awards. Treasury also said the changes would "ensure compliance with federal anti-discrimination laws," the piece the CY 2026 NOAA writes into the Allocation Agreement covenant described above.

Housekeeping Ahead of the Round

The Fund has been updating program infrastructure for permanence. Its June 17, 2026 Federal Register notice (91 FR 36650) sought comment through August 17, 2026 on the Allocation and Qualified Equity Investment Tracking System (AQEI), the reporting platform allocatees use to record QEIs. The notice estimated 202 respondents and 1,515 annual burden hours. On August 7, 2026, the Fund launched CIMS5, the new version of its mapping system for verifying low-income community eligibility, through AMIS, and released public NMTC transaction data through fiscal year 2023.

Exhibit 4 lays out the round's calendar, from OBBBA's enactment through the January 2027 deadlines for prior allocatees.

What to Do Now

This round is worth a look for certified CDEs, prior allocatees weighing how much new authority to request, and companies with projects in low-income or rural communities that need below-market financing. Registration in AMIS closes at 5:00 p.m. ET on October 6, 2026, and applicants that miss it cannot submit. If you want a read on fit before that deadline, reach out to our team.

References

1. CDFI Fund, Funding Opportunity; Notice of Allocation Availability Inviting Applications for the Calendar Years 2026 Allocation Round of the New Markets Tax Credit Program, 91 Fed. Reg. 58526, Sept. 15, 2026.
2. CDFI Fund, Get Ready to Apply to the Upcoming CY 2026 New Markets Tax Credit Program Allocation Application Round, Aug. 12, 2026.
3. CDFI Fund, The CDFI Fund Welcomes a New Director, Aug. 25, 2026.
4. CDFI Fund, CDFI Fund Releases Summary Report and Public Data for NMTC Program for FYs 2003-2023, Aug. 7, 2026.
5. CDFI Fund, CIMS5 Officially Launches Through AMIS Platform, Aug. 7, 2026.
6. Office of the Law Revision Counsel, 26 U.S.C. § 45D, New Markets Tax Credit, as amended by Pub. L. 119-21, § 70423 (July 4, 2025).
7. Congress.gov, H.R. 1, One Big Beautiful Bill Act, Public Law 119-21.
8. CDFI Fund, New Markets Tax Credit Program, U.S. Department of the Treasury.
9. CDFI Fund, Treasury Pairs New Markets Tax Credit Awards with Program Reforms, Dec. 23, 2025.
10. CDFI Fund, CY 2024-2025 NMTC Program Award Book, Dec. 2025.
11. CDFI Fund, CDFI Fund Resumes Acceptance of CDE Certification Applications, Sept. 9, 2025.
12. Novogradac, NMTC Awards Hit Record Levels; Program Changes Ahead, Dec. 24, 2025.
13. Novogradac, Timeline for Allocation Agreements, Opening of 2026 Round Top of Mind for NMTC Conference Panelists, 2026.
14. CDFI Fund, Notice of Information Collection and Request for Public Comment (NMTC AQEI), 91 Fed. Reg. 36650, June 17, 2026.

© Copyright 2026 TC Policy Group, LLC (d/b/a Crawford Partners). The views expressed herein are those of the author(s) and not necessarily the views of Crawford Partners, its management, its subsidiaries, its affiliates, or its other professionals. Crawford Partners is not a law firm and cannot provide legal advice.