New Markets Tax Credit Funding for Habitat Homes Build in Des Moines

September 27, 2012 --ST. LOUIS, MO:  New Markets Tax Credits (NMTCs) are playing an increasingly important role in helping Habitat for Humanity affiliates provide homeownership opportunities for families in low income communities. In August, Greater Des Moines Habitat for Humanity (GDM Habitat) and four other Iowa Habitat affiliates including Cedar Valley, Iowa Heartland, Iowa Valley, and Siouxland shared $12 million of NMTC financing to build 94 Habitat homes across the state. Financing includes more than $3.6 million of NMTC equity from U.S. Bank and sponsorship dollars provided by the Habitat affiliates and various corporate and faith-based organizations and individuals.

The Greater Des Moines Habitat will use its nearly $4.5 million NMTC investment from Iowa Community Development LC (ICD) to build 27 homes ranging in size from 1023 – 1320 sq. ft. in the Riverbend, Union Park, King Irving, Mondamin Presidential, Capitol Park, and Drake neighborhoods. Construction will be completed by May 15, 2013.

The NMTC program is administered by the U.S. Treasury and is designed to spur new or increased investment in operating businesses and real estate developments located in low-income communities. The program provides tax credits as an incentive for private investment and leverages public and private funding to provide borrowers like these Iowa Habitat affiliates with financing in the form of very favorable below market rates and flexible terms.

Partnerships like this one orchestrated by Smith NMTC Associates, LLC (Smith NMTC) with ICD,  and the Iowa Habitat affiliates and invested in by U.S. Bank help stretch fundraising and development dollars, increasing the nonprofit’s ability to meet its mission of building decent, affordable housing for hardworking families in need.

“NMTC funding will help provide homeownership opportunities for 27 families, including more than 50   children,” said Lance Henning, executive director of Greater Des Moines Habitat for Humanity. “We are thrilled to be second time recipients of this funding that assists in building stable home environments and a revitalized community.”

The homes in Des Moines will be built in areas receiving additional attention through Greater Des Moines Habitat’s Rock the Block™ program. A year ago, a new playground was installed at Edna Griffin Park, located in the King Irving neighborhood to provide an updated, safe place for children to gather and play.  Rock the Block™ has impacted nearly 20 families in King Irving/Mondamin Presidential neighborhoods and more than 20 families in the Drake neighborhood in 2012. Many other community organizations have focused efforts in these neighborhoods as well. Through Rock the Block™, GDM Habitat collaborates with many of them to help spur holistic neighborhood revitalization.

Energy efficiency is also a significant benefit for GDM Habitat family partners. The GDM affiliate recently built the first homes in Iowa to meet the National Association of Home Builders Emerald standard, the highest rating for residential green building requiring energy savings of 60% or more.  Two of the homes will be built to National Association of Home Builder’s Emerald standard, and the remaining 25 will meet Energy Star 3.0 standards insuring energy savings of up to 30% percent, compared to a home built to code. 

The idea of applying NMTC financing to “for-sale” affordable housing as a funding vehicle for Habitat for Humanity affiliates was the primary goal and focus of Smith NMTC co-founders Howard Smith, JD, Principal and Donna Smith, JD, Executive Vice President.  Having served as president, general counsel and a member of the Habitat for Humanity St. Louis board of directors for over 20 years, Howard knew the revitalizing impact home ownership has on low income communities.  After discussing the idea with NMTC officials at U.S. Bank and putting together a working model, the Smiths saw their idea build – literally. The Smith NMTC Model now makes NMTC dollars available to help Habitat affiliates build more homes and make more homes available to industrious Habitat family partner buyers across the U.S.

Additional benefits of the Habitat home builds receiving NMTC funding are the number of local businesses and volunteers involved in the build furthering their businesses and the local economy.  In Iowa, 73 full-time Habitat affiliate jobs will be retained, one full-time affiliate job will be created, 16 part-time affiliate jobs will be retained and 125 construction or pre-development jobs will be created.    

It Takes a Community to Build a Community

Similar to the approach Habitat for Humanity must take to gather necessary volunteers and businesses to get a home funded and built, the process of putting together NMTC funding for Habitat affiliates requires a community of focused, committed partners to insure success. 

“We were fortunate to have the excellent participation of U.S. Bancorp Community Development Corporation; Iowa Community Development; Polsinelli Shughart, PC; Novogradac & Company, LLP; Elkins, PLC; Ahlers & Cooney, PC.; Husch Blackwell, and Davis Brown Law Firm to complete all legal, financial, accounting and compliance requirements to make this $12 million of NMTC funding possible in Iowa,” said Howard Smith.  “Each provided invaluable assistance.”

Habitat family partners contribute between 300 - 500 sweat equity hours before purchasing their home. They pay a modest down payment, sign standard loan documents, and make affordable, monthly mortgage payments to repay the 0%-interest loan over 20-30 years.  These Habitat affiliates offer homeownership opportunities to low-income families unable to obtain conventional financing.

“Strengthening our communities with NMTC dollars has far reaching benefits,” said John Rigler, Chairman of Iowa Community Development.  “We are pleased to partner with Smith NMTC and others on this project by supporting the Habitat for Humanity mission to provide affordable and sustainable housing for hard-working, low-income families in Iowa,” Rigler added.

Allocation of NMTC Funding to the four additional Iowa affiliates follows:

Cedar Valley Habitat for Humanity received more than $1.9 million of NMTC financing to build 13 (813 – 1966 sq. ft.) homes in Cedar Rapids, Hiawatha, and Marion, IA to be completed by October 1, 2013.

Iowa Heartland Habitat for Humanity received a $2.2 million NMTC investment to build 27 (1100 -1200 sq. ft.) homes in Waterloo, Waverly and Cedar Falls, IA. Construction will be completed over a nine year period with 17 of the homes completed by December 2013, three additional homes by August 2014, and the remaining seven homes by August 1, 2021.

Iowa Valley Habitat for Humanity received more than $1.0 million of NMTC funding to build 9 (1250 – 1350 sq. ft.) homes in Iowa City and Tipton, IA. Construction of four homes will be completed in the next 16 months and the remainder over a 7 year period.

Siouxland Habitat for Humanity received a more than $2.0 million NMTC investment to build 18 (1120-2670 sq. ft.) homes in Sioux City, Onawa and Sioux Center, IA. Ten of the homes will be completed by September 2013 and the remaining 8 homes will be completed by October 2017.

 The Five Iowa Habitat Affiliates, Iowa Business Growth Company, U.S. Bank and Smith NMTC Associates, LLC, partnerships building communities, are looking forward to seeing the 94 new Habitat family partners at work with local businesses and volunteers raising their new houses and fulfilling a time-honored American dream.

For high resolution images of Habitat Homes, construction sites, or families in Iowa, contact



Resources for Journalists and Readers:   

New Markets Tax Credits Program:
In 2000, as part of the Community Renewal Tax Relief Act, Congress established the NMTC Program with the goal of attracting new investment capital to disadvantaged communities. Through a competitive process, certified Community Development Entities are awarded allocations of tax credits - which they can use to attract and raise capital for projects in low-income communities - by the Community Development Financial Institutions Fund through the Department of the Treasury. The credit totals 39 percent of the original investment amount and is claimed over a period of seven years. For more information, visit

Smith New Markets Tax Credit Basics:

Smith NMTC Model in-depth Article on New Markets Tax Credits:

Greater Des Moines Habitat for Humanity:

Greater Des Moines Habitat for Humanity (GDM Habitat) is an ecumenical Christian housing ministry that provides decent and affordable homeownership opportunities for qualified low-income families. Hard-working, low-income families apply for partnership based on three criteria: need, ability to pay, and willingness to partner. At closing, families purchase their home through a 20-year, no-interest mortgage. In addition to creating homeownership opportunities GDM Habitat is focused on neighborhood revitalization through the Rock the Block™ program. Rock the Block™ assists residents with repair, maintenance and beautification of homes.  Visit for more information.

Iowa Community Development LC (ICD) creates and preserves jobs and improves quality of life in both metro and rural low income communities in the State of Iowa by providing access to project capital through New Market Tax Credits.  Over the past five years, ICD has placed $134 million into 14 projects around the State of Iowa. These very diversified projects have ranged from manufacturing facilities to the historic renovation of office buildings. Job Creation and economic impact in Iowa’s low income communities are the driving force behind ICD’s project selection and mission. ICD is administered by

Iowa Business Growth Company which has a long history of providing alternative financing resources for economic development in the State of Iowa.

Smith NMTC Associates, LLC facilitates transactions with New Markets Tax Credits, (NMTC) a fairly unknown (but growing in name recognition) federal tax credit program administered by the Department of Treasury’s Community Development Financial Institution Fund (CDFI Fund). The program is delineated in Section 45(d) of the Internal Revenue Code, as amended in 2008. Smith NMTC also works with the investors and borrowers throughout the 7 year compliance period, serving as compliance agent for the CDEs and investors and providing financial counseling to the borrowers.

In conjunction with its own as well as other CDEs, Smith NMTC has provided more than $270 million of financing in support of construction, financing and sale of Habitat homes across the nation.  This translates into 3,011 homes being built for needy families while revitalizing low-income communities in  30 states and creating  4,836 construction and creating/retaining  1,935 permanent jobs. For more information, and press kit

U.S. Bank:

With $353 billion in assets as of June 30, 2012, U.S. Bancorp is the parent company of U.S. Bank, the fifth-largest commercial bank in the United States. The company operates 3,080 banking offices in 25 states and 5,085 ATMs and provides a comprehensive line of banking, brokerage, insurance, investment, mortgage, trust and payment services products to consumers, businesses and institutions. U.S. Bank is also a recognized leader in financing a variety of community development initiatives using state and federally sponsored tax credit programs. U.S. Bancorp Community Development Corporation, the investment subsidiary of U.S. Bank, provides capital investment to areas that need it the most and has contributed to the generation of commercial economic activity, rehabilitation of historic buildings, construction of affordable and market-rate homes, and development of renewable energy facilities. Visit U.S. Bank on the web at

P3 Strategies Inc:

This press release has been issued by P3 Strategies Inc provider of Strategy, Marketing and Media world-wide for Social Entrepreneurs and organizations seeking a triple bottom-line. For more information, or 314-835-0300.