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This brief examines the characteristics of census tracts where New Market Tax Credit (NMTC) projects are located to determine whether the program is targeting the intended neighborhoods. We find that NMTC projects are located in neighborhoods that, relative to eligible tracts that did not receive NMTCs, have higher poverty rates, lower median incomes, and larger shares of people of color. Further, the majority of NMTCs go to the most disadvantaged neighborhoods in the country. We find that nonmetropolitan areas get fewer NMTC project dollars per capita than metropolitan areas.
This brief was corrected on November 28, 2023. On page 2, the second bullet was changed to "If the tract is not located within a metropolitan area, the median family income for such tract does not exceed 80 percent of statewide median family income." A previous version said “If the tract is located.”
