[Federal Register Volume 78, Number 145 (Monday, July 29, 2013)]
[Notices]
[Pages 45604-45614]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-18140]


-----------------------------------------------------------------------

DEPARTMENT OF THE TREASURY

Community Development Financial Institutions Fund


Funding Opportunity Title: Notice of Allocation Availability 
(NOAA) Inviting Applications for the combined Calendar Year (CY) 2013 
and 2014 Allocation Round of the New Markets Tax Credit (NMTC) Program

    Announcement Type: Announcement of NMTC allocation availability.

Dates: Electronic applications must be received by 5:00 p.m. ET on 
September 18, 2013. Applications sent by mail, facsimile or other form 
will not be accepted. Please note the Community Development Financial 
Institutions Fund (CDFI Fund) will only accept applications and 
attachments (i.e., the CDE's authorized representative signature page, 
the Controlling Entity's representative signature page, investor 
letters and organizational charts) in electronic form (see Section 
IV.D. of this NOAA for more details). Applications must meet all 
eligibility and other requirements and deadlines, as applicable, set 
forth in this NOAA. NMTC allocation applicants that are not yet 
certified as Community Development Entities (CDEs) must submit an 
application for CDE certification that is postmarked on or before 
August 9, 2013 (see Section III of this NOAA for more details).
    Executive Summary: This NOAA is issued in connection with the 
combined CY 2013 and 2014 allocation round (Round) of the New Markets 
Tax Credit (NMTC) Program, as initially authorized by Title I, subtitle 
C, section 121 of the Community Renewal Tax Relief Act of 2000 (Pub.L. 
106-554) and amended by section 221 of the American Jobs Creation Act 
of 2004 (Pub.L. 108-357), section 101 of the Gulf Opportunity Zone Act 
of 2005 (P.L. 108-357), Division A, section 102 of the Tax Relief and 
Health Care Act of 2006 (Pub. L. 109-432), section 733 of the Tax 
Relief, Unemployment Insurance Reauthorization and Job Creation Act of 
2010 (Pub. L. 111-312), and the American Taxpayer Relief Act of 2012 
(the Act). Through the NMTC Program, the CDFI Fund provides authority 
to CDEs to offer an incentive to investors in the form of tax credits 
over seven years, which is expected to stimulate the provision of 
private investment capital that, in turn, will facilitate economic and 
community development in Low-Income Communities. Through this NOAA, the 
CDFI Fund announces the availability of up to $8.5 billion of NMTC 
investment authority, $3.5 billion of which has been authorized in the 
Act and an additional $5.0 billion, which is subject to Congressional 
authorization.
    In this NOAA, the CDFI Fund specifically addresses how an entity 
may apply to receive an allocation of NMTCs, the competitive procedure 
through which NMTC allocations will be made, and the actions that will 
be taken to ensure that proper allocations are made to appropriate 
entities.

I. Allocation Availability Description

    A. Programmatic changes from CY 2012 round:
    1. Allocation Amounts: As described in Section IIA, the CDFI Fund 
anticipates that it will provide NMTC allocation awards for not more 
than $125 million of allocation per Allocatee.
    2. Prior QEI Issuance Requirements: In order to be eligible to 
apply for NMTC allocations in this Round, as described in Section 
III.A.2(a), applicants that have received NMTC allocation awards in 
previous rounds are required to meet minimum Qualified Equity 
Investment (QEI) issuance thresholds with respect to their prior-year 
allocations. These thresholds and deadlines have been revised in 
comparison to the CY 2012 NOAA.
    3. Assurances and Certification written explanations: An applicant 
that fails to correctly answer a question under the Assurances and 
Certifications section of the application and submit the required 
written explanation, but fails to do so is deemed to be ineligible, at 
the discretion of the CDFI Fund.
    4. Affordable housing requirement: An applicant that proposes to 
use NMTCs to invest in projects that result in housing units must 
ensure that at least 20 percent of aggregate developed or rehabilitated 
units are affordable housing, as defined in the September 2011 NMTC 
Compliance and Monitoring Frequently Asked Questions document.
    5. Definition of a Rural CDE: The definition of a Rural CDE is 
revised to reduce the track record required for the number of years of 
direct financing dollars from each of the last five years to three out 
of the last five years.
    B. Program guidance and regulations: This NOAA provides guidance 
for the application and allocation of NMTCs for this Round of the NMTC 
Program and

[[Page 45605]]

should be read in conjunction with: (i) Guidance published by the CDFI 
Fund on how an entity may apply to become certified as a CDE (66 
Federal Register 65806, December 20, 2001); (ii) the final regulations 
issued by the Internal Revenue Service (26 CFR 1.45D-1, published on 
December 28, 2004), as amended and related guidance, notices and other 
publications; and (iii) the application and related materials for this 
Round. All such materials may be found on the CDFI Fund's Web site at 
http://www.cdfifund.gov. The CDFI Fund encourages applicants to review 
these documents. Capitalized terms used, but not defined, in this NOAA 
shall have the respective meanings assigned to them in the allocation 
application, IRC Sec.  45D or the IRS regulations. In the event of any 
inconsistency between the allocation application, IRC Sec.  45D or the 
IRS regulations, the provisions of IRC Sec.  45D and the IRS 
regulations shall govern.

II. Allocation Information

    A. Allocation amounts: Pursuant to the Act, the CDFI Fund expects 
that it may allocate to CDEs the authority to issue to their investors 
up to the aggregate amount of $8.5 billion in equity as to which NMTCs 
may be claimed, as permitted under IRC Sec.  45D(f)(1)(D). Pursuant to 
this NOAA, the CDFI Fund anticipates that it will not issue more than 
$125 million in tax credit investment authority per Allocatee. The CDFI 
Fund, in its sole discretion, reserves the right to allocate amounts in 
excess of or less than the anticipated maximum allocation amount should 
the CDFI Fund deem it appropriate. In order to receive an allocation in 
excess of the $125 million cap, an applicant, at a minimum, will need 
to demonstrate that: (i) No part of its strategy can be successfully 
implemented without an allocation in excess of the applicable cap; and/
or (ii) its strategy will produce extraordinary community outcomes. The 
CDFI Fund reserves the right to allocate NMTC authority to any, all, or 
none of the entities that submit an application in response to this 
NOAA, and in any amount it deems appropriate.
    B. Types of awards: NMTC Program awards are made in the form of 
allocations of tax credit investment authority.
    C. Allocation Agreement: Each Allocatee under this NOAA must sign 
an Allocation Agreement, which must be countersigned by the CDFI Fund, 
before the NMTC allocation is effective. The Allocation Agreement 
contains the terms and conditions of the allocation. For further 
information, see Section VI of this NOAA.

III. Eligibility

    A. Eligible applicants: IRC Sec.  45D specifies certain eligibility 
requirements that each applicant must meet to be eligible to apply for 
an allocation of NMTCs. The following sets forth additional detail and 
certain additional dates that relate to the submission of applications 
under this NOAA for the available NMTC investment authority.
    1. CDE certification: For purposes of this NOAA, the CDFI Fund will 
not consider an application for an allocation of NMTCs unless: (a) the 
applicant is certified as a CDE at the time the CDFI Fund receives its 
NMTC Program allocation application; or (b) the applicant submits an 
application for certification as a CDE that is Postmarked on or before 
August 9, 2013. Applicants for certification may obtain a CDE 
certification application through the CDFI Fund's Web site at http://www.cdfifund.gov. Applications for CDE certification must be submitted 
as instructed in the application form. An applicant that is a Community 
Development Financial Institution (CDFI) or a Specialized Small 
Business Investment Company (SSBIC) does not need to submit a CDE 
certification application; however, it must register as a CDE on the 
CDFI Fund's Web site on or before 5:00 p.m. ET on August 9, 2013. See 
Section IV.D.1(b) of this NOAA for further requirements relating to 
Postmarks.
    The CDFI Fund will not provide NMTC allocation authority to 
applicants that are not certified as CDEs nor to entities that are 
certified as Subsidiary CDEs.
    If an applicant that has already been certified as a CDE wishes to 
change its designated CDE service area, it must submit its request for 
such change to the CDFI Fund, and the request must be received by the 
CDFI Fund by 5:00 p.m. ET on August 9, 2013. The CDE service area 
change request must be sent from the applicant's authorized 
representative and include the applicable CDE control number, the 
revised service area designation, and an updated accountability chart 
that reflects representation from Low-Income Communities in the revised 
service area. The service area change request must be sent by email to 
[email protected].
    2. Prior awardees or Allocatees: Applicants must be aware that 
success in a prior round of any of the CDFI Fund's programs is not 
indicative of success under this NOAA. For purposes of this section, 
the CDFI Fund will consider an Affiliate to be any entity that meets 
the definition of Affiliate as defined in the NMTC allocation 
application materials, or any entity otherwise identified as an 
Affiliate by the applicant in its NMTC allocation application 
materials. Prior awardees of any CDFI Fund program are eligible to 
apply under this NOAA, except as follows:
    (a) Prior Allocatees and Qualified Equity Investment (QEI) issuance 
requirements: The following describes the QEI issuance requirements 
applicable to prior Allocatees.
    A prior Allocatee in the CY 2007 round of the NMTC Program is not 
eligible to receive a NMTC allocation pursuant to this NOAA unless the 
Allocatee is able to affirmatively demonstrate that, as of 11:59 p.m. 
ET on December 31, 2013, it has finalized at least 95 percent of its 
QEIs relating to its CY 2007 NMTC allocation.
    A prior Allocatee in the CY 2008 round of the NMTC Program is not 
eligible to receive a NMTC allocation pursuant to this NOAA unless the 
Allocatee is able to affirmatively demonstrate that, as of 11:59 p.m. 
ET on December 31, 2013, it has: (i) finalized at least 80 percent of 
its QEIs relating to its CY 2008 NMTC allocation; or (ii) it has 
finalized at least 70 percent of its QEIs and that at least 100 percent 
of its total CY 2008 NMTC allocation has been finalized, or has been 
committed by its investors.
    A prior Allocatee in the CY 2009 round of the NMTC Program is not 
eligible to receive a NMTC allocation pursuant to this NOAA unless the 
Allocatee is able to affirmatively demonstrate that, as of 11:59 p.m. 
ET on December 31, 2013, it has: (i) finalized at least 70 percent of 
its QEIs relating to its CY 2009 NMTC allocation; or (ii) it has 
finalized at least 60 percent of its QEIs and that at least 80 percent 
of its total CY 2009 NMTC allocation has been finalized, or has been 
committed by its investors.
    A prior Allocatee in the CY 2010 round of the NMTC Program is not 
eligible to receive a NMTC allocation pursuant to this NOAA unless the 
Allocatee is able to affirmatively demonstrate that, as of 11:59 p.m. 
ET on December 31, 2013, it has: (i) finalized at least 60 percent of 
its QEIs relating to its CY 2010 NMTC allocation; or (ii) it has 
finalized at least 50 percent of its QEIs and that at least 80 percent 
of its total CY 2010 NMTC allocation has been finalized, or has been 
committed by its investors.
    A prior Allocatee (with the exception of a Rural CDE Allocatee) in 
the CY 2011 round of the NMTC Program is not eligible to receive a NMTC 
allocation

[[Page 45606]]

pursuant to this NOAA unless the Allocatee is able to affirmatively 
demonstrate that, as of 11:59 p.m. ET on December 31, 2013, it has: (i) 
finalized at least 50 percent of its QEIs relating to its CY 2011 NMTC 
allocation; or (ii) it has finalized at least 40 percent of its QEIs 
and that at least 60 percent of its total CY 2011 NMTC allocation has 
been finalized, or has been committed by its investors. A prior Rural 
CDE Allocatee in the CY 2011 is not eligible to receive a NMTC 
allocation pursuant to this NOAA unless the Allocatee can demonstrate 
that, as of 11:59 p.m. ET on December 31, 2013, it has finalized at 
least 30 percent of its CY 2011 NMTC Allocation.
    A prior Allocatee (with the exception of a Rural CDE Allocatee) in 
the CY 2012 round of the NMTC Program is not eligible to receive a NMTC 
allocation pursuant to this NOAA unless the Allocatee is able to 
affirmatively demonstrate that, as of 11:59 p.m. ET on December 31, 
2013, it has: (i) Finalized at least 30 percent of its QEIs relating to 
its CY 2012 NMTC allocation; or (ii) finalized at least 20 percent of 
its QEIs and that at least 50 percent of its total CY 2012 NMTC 
allocation has been finalized, or has been committed by its investors. 
A Rural CDE is not required to meet the above QEI issuance and 
commitment thresholds with regard to its CY 2012 NMTC allocation award.
    In addition to the requirements described above, an entity is not 
eligible to receive a NMTC allocation pursuant to this NOAA if an 
Affiliate of the applicant is a prior Allocatee and has not met the 
requirements for the issuance and/or commitment of QEIs as set forth 
above for the Allocatees in the prior allocation rounds of the NMTC 
Program.
    Notwithstanding the above, if an applicant has received multiple 
NMTC allocation awards between the CY 2007 and the CY 2012, the 
applicant shall be deemed to be eligible to apply for a NMTC allocation 
pursuant to this NOAA if the applicant is able to affirmatively 
demonstrate that, as of 11:59 p.m. ET on December 31, 2013, it has 
finalized at least 90 percent of its QEIs relating to its cumulative 
allocation amounts from these prior NMTC Program rounds. Rural CDEs 
that received allocations under the CY 2011 round may choose to exclude 
such allocations from this cumulative calculation, provided that the 
Allocatee has finalized at least 20 percent of its QEIs relating to its 
CY 2011 allocation. Rural CDEs that received allocations under the CY 
2012 round may choose to exclude such allocation from this cumulative 
calculation.
    For purposes of this section of the NOAA, the CDFI Fund will only 
recognize as ``finalized'' those QEIs that have been properly reported 
in the CDFI Fund's Allocation Tracking System (ATS) by the deadlines 
specified above. Allocatees and their Subsidiary Allocatees, if any, 
are advised to access ATS to record each QEI that they issue to an 
investor in exchange for funds in-hand. For purposes of this section of 
the NOAA, ``committed'' QEIs are only those Equity Investments that are 
evidenced by a written, signed document in which an investor: (i) 
commits to make a QEI in the Allocatee in a specified amount and on 
specified terms; (ii) has made an initial disbursement of the 
investment proceeds to the Allocatee, and such initial disbursement has 
been recorded in ATS as a QEI; (iii) commits to disburse the remaining 
investment proceeds to the Allocatee based on specified amounts and 
payment dates; and (iv) commits to make the final disbursement to the 
Allocatee no later than December 31, 2015.
    The applicant will be required, upon notification from the CDFI 
Fund, to submit adequate documentation to substantiate the required 
issuances of and commitments for QEIs.
    Applicants should be aware that these QEI issuance requirements 
represent the minimum threshold requirements that must be met in order 
to submit an application for assistance under this NOAA. As stated in 
Section V.B.2 of this NOAA, the CDFI Fund reserves the right to reject 
an application and/or adjust award amounts as appropriate based on 
information obtained during the review process--including an 
applicant's track record of raising QEIs and/or deploying its Qualified 
Low Income Community Investments (QLICIs).
    Prior Allocatees that require any action by the CDFI Fund (i.e., 
certifying a subsidiary entity as a CDE; adding a subsidiary CDE to an 
Allocation Agreement; etc.) in order to meet the QEI issuance 
requirements above must submit their Certification Application for 
subsidiary CDEs by no later than October 1, 2013 and Allocation 
Agreement Amendment requests by no later than November 1, 2013 in order 
to guarantee that the CDFI Fund completes all necessary approvals prior 
to December 31, 2013. Applicants for certification may obtain a CDE 
certification application through the CDFI Fund's Web site at http://www.cdfifund.gov. Applications for CDE certification must be submitted 
as instructed in the application form.
    (b) Failure to meet reporting requirements: The CDFI Fund will not 
consider an application submitted by an applicant if the applicant or 
any of its Affiliates is a prior CDFI Fund awardee or Allocatee under 
any CDFI Fund program and is not current on the reporting requirements 
set forth in a previously executed assistance, allocation or award 
agreement(s), as of the application deadline of this NOAA. Please note 
that automated systems employed by the CDFI Fund for receipt of reports 
submitted electronically typically acknowledge only a report's receipt; 
such acknowledgment does not warrant that the report received was 
complete and therefore met reporting requirements.
    (c) Pending determination of noncompliance or default: If an 
applicant is a prior awardee or Allocatee under any CDFI Fund program 
and if: (i) it has submitted complete and timely reports to the CDFI 
Fund that demonstrate noncompliance with or default under a previous 
assistance, award or Allocation Agreement; and (ii) the CDFI Fund has 
yet to make a final determination as to whether the entity is in 
noncompliance or default of its previous assistance, award or 
Allocation Agreement, the CDFI Fund will consider the applicant's 
application under this NOAA pending final determination of whether the 
entity is in noncompliance or default, in the sole determination of the 
CDFI Fund. Further, if an Affiliate of the applicant is a prior CDFI 
Fund awardee or Allocatee and if such entity: (i) Has submitted 
complete and timely reports to the CDFI Fund that demonstrate 
noncompliance or default with a previous assistance, award or 
Allocation Agreement; and (ii) the CDFI Fund has yet to make a final 
determination as to whether the entity is in noncompliance or default 
of its previous assistance, award or Allocation Agreement, the CDFI 
Fund will consider the applicant's application under this NOAA pending 
final determination of whether the entity is in noncompliance or 
default, in the sole determination of the CDFI Fund.
    Notwithstanding the above, any applicant or Affiliate that is in 
default under Section 3.2 of its previously executed Allocation 
Agreement is deemed ineligible in this NOAA if (i) the CDFI Fund has 
made a determination that such applicant is in default under Section 
3.2 of a previously executed Allocation Agreement and (ii) the CDFI 
Fund has provided written notification of such determination to the 
applicant. Thus, any applicant that is otherwise eligible as of the 
application deadline must

[[Page 45607]]

continue to be compliant with Section 3.2 of its Allocation 
Agreement(s) after the application deadline, in order for the CDFI Fund 
to continue evaluating its application. If an applicant fails to do 
such, the CDFI Fund will no longer deem the applicant eligible.
    (d) Default Status: The CDFI Fund will not consider an application 
submitted by an applicant that is a prior CDFI Fund awardee or 
Allocatee under any CDFI Fund program if, as of the application 
deadline of this NOAA: (i) The CDFI Fund has made a determination that 
such applicant is in default of a previously executed assistance, 
allocation, or award agreement; (ii) the CDFI Fund has provided written 
notification of such determination to the Applicant; and (iii) the 
application deadline of the NOAA is within a period of time, specified 
in a notification to the prior CDFI Fund awardee or Allocatee, for 
which any new application from the applicant to the CDFI Fund for an 
award, allocation, or assistance is prohibited.
    Further, the CDFI Fund will not consider an application submitted 
by an applicant for which there is an Affiliate that is a prior awardee 
or Allocatee under any CDFI Fund Program if, as of the application 
deadline of this NOAA: (i) The CDFI Fund has made a determination that 
such Affiliate is in default of a previously executed assistance, 
allocation, or award agreement; (ii) the CDFI Fund has provided written 
notification of such determination to the Affiliate; and (iii) the 
application deadline of the NOAA is within a period of time, specified 
in a notification to the prior CDFI Fund awardee or Allocatee, for 
which any new application from the Affiliate to the CDFI Fund for an 
award, allocation, or assistance is prohibited.
    (e) Undisbursed award funds: The CDFI Fund will not consider an 
application submitted by an applicant that is a prior awardee under any 
CDFI Fund program if the applicant has a balance of undisbursed award 
funds (defined below) under said prior award(s), as of the applicable 
application deadline of this NOAA. Furthermore, an entity is not 
eligible to apply for an award pursuant to this NOAA if an Affiliate of 
the applicant is a prior awardee under any CDFI Fund program, and has a 
balance of undisbursed award funds under said prior award(s), as of the 
applicable application deadline of this NOAA. In a case where an 
Affiliate of the applicant is a prior awardee under any CDFI Fund 
program and has a balance of undisbursed award funds under said prior 
award(s) as of the applicable application deadline of this NOAA, the 
CDFI Fund will include the combined awards of the Applicant and such 
Affiliated entities when calculating the amount of undisbursed award 
funds.
    For purposes of the calculation of undisbursed award funds for the 
Bank Enterprise Award (BEA) Program, only awards made to the applicant 
(and any Affiliates) three to five calendar years prior to the end of 
the calendar year of the application deadline of this NOAA are included 
(``includable BEA awards''). Thus, for purposes of this NOAA, 
undisbursed BEA Program award funds are the amount of FYs 2008, 2009, 
2010 awards that remain undisbursed as of the application deadline of 
this NOAA.
    For purposes of the calculation of undisbursed award funds for the 
CDFI Program and the Native Initiatives (NI), only awards made to the 
Applicant (and any entity that Controls the Applicant, is Controlled by 
the Applicant or shares common management officials with the Applicant, 
as determined by the CDFI Fund) two to five calendar years prior to the 
end of the calendar year of the application deadline of this NOAA are 
included (``includable CDFI/NI awards''). Thus, for purposes of this 
NOAA, undisbursed CDFI Program and NI awards are the amount of FYs 
2008, 2009, 2010 and 2011 awards that remain undisbursed as of the 
application deadline of this NOAA.
    To calculate total includable BEA/CDFI/NI awards: amounts that are 
undisbursed as of the application deadline of this NOAA cannot exceed 
five percent (5%) of the total includable awards. Please refer to an 
example of this calculation in the Round Allocation Application Q&A 
document, available on the CDFI Fund's Web site.
    The ``undisbursed award funds'' calculation does not include: (i) 
NMTC allocation authority; (ii) any award funds for which the CDFI Fund 
received a full and complete disbursement request from the awardee by 
the applicable application deadline of this NOAA; (iii) any award funds 
for an award that has been terminated, in writing, by the CDFI Fund or 
de-obligated by the CDFI Fund; or (iv) any award funds for an award 
that does not have a fully executed assistance or award agreement. The 
CDFI Fund strongly encourages Applicants requesting disbursements of 
``undisbursed funds'' from prior awards to provide the CDFI Fund with a 
complete disbursement request at least 30 business days prior to the 
application deadline of this NOAA.
    (f) Contact the CDFI Fund: Accordingly, Applicants that are prior 
awardees and/or Allocatees under any other CDFI Fund program are 
advised to: (i) comply with the requirements specified in assistance, 
allocation and/or award agreement(s), and (ii) contact the CDFI Fund to 
ensure that all necessary actions are underway for the disbursement of 
any outstanding balance of a prior award(s). All outstanding reports 
and compliance questions should be directed to the Certification, 
Compliance Monitoring and Evaluation Manager by email at 
[email protected], by telephone at (202) 653-0421. All disbursement 
questions related to the CDFI and NACA Programs should be directed to 
the CDFI Fund Help Desk by telephone 202-653-0421 (Option 1 for CDFI 
Program, Option 2 for the NACA Program) or via email at 
[email protected]. All disbursement questions related to the BEA 
Program should be directed to David Fleites, Policy and Program Officer 
by telephone at 202-653-0355 or via email at [email protected]. 
Requests submitted less than thirty calendar days prior to the 
application deadline may not receive a response before the application 
deadline.
    The CDFI Fund will respond to Applicants' reporting, compliance or 
disbursement questions between the hours of 9:00 a.m. and 5:00 p.m. ET, 
starting the date of publication of this NOAA through September 16, 
2013 (two days before the application deadline). The CDFI Fund will not 
respond to Applicants' reporting, compliance, CDE certification or 
disbursement phone calls or email inquiries that are received after 
5:00 p.m. ET on September 16, 2013 until after the funding application 
deadline of September 18, 2013.
    3. Failure to accurately respond to a question in the Assurances 
and Certifications section of the application and submit the required 
written explanation: The CDFI Fund will not consider the applicant's 
application if the CDFI Fund determines, in its sole discretion, the 
applicant inaccurately responded to a question and was required to 
submit as part of its application a written explanation, with respect 
to any application Assurances and Certifications, but did not do so.
    4. Entities that propose to transfer NMTCs to Subsidiaries: Both 
for-profit and non-profit CDEs may apply for NMTC allocation authority, 
but only a for-profit CDE is permitted to provide NMTCs to its 
investors. A non-profit applicant wishing to apply for a NMTC 
allocation must demonstrate, prior to entering into an Allocation 
Agreement with the CDFI Fund, that: (i) it controls one or more 
Subsidiaries that are for-profit entities; and (ii) it intends to

[[Page 45608]]

transfer the full amount of any NMTC allocation it receives to said 
Subsidiary.
    An applicant wishing to transfer all or a portion of its NMTC 
allocation to a Subsidiary is not required to create the Subsidiary 
prior to submitting a NMTC allocation application to the CDFI Fund. 
However, the Subsidiary entities must be certified as CDEs by the CDFI 
Fund, and enjoined as parties to the Allocation Agreement at closing or 
by amendment to the Allocation Agreement after closing. Before the NMTC 
allocation transfer may occur it must be pre-approved by the CDFI Fund, 
in its sole discretion.
    The CDFI Fund strongly encourages a non-profit applicant to submit 
a CDE certification application to the CDFI Fund on behalf of at least 
one Subsidiary within 60 days after the non-profit applicant receives 
the Notice of Allocation (NOA) from the CDFI Fund, as such Subsidiary 
must be certified as a CDE prior to entering into an Allocation 
Agreement with the CDFI Fund. A non-profit applicant that does not 
already have a certified for-profit Subsidiary and that fails to submit 
a certification application for one or more for-profit Subsidiaries 
within 60 days of the date of the NOA from the CDFI Fund is subject to 
the CDFI Fund rescinding the award.
    5. Entities that submit applications together with Affiliates; 
applications from common enterprises: (a) As part of the allocation 
application review process, the CDFI Fund considers whether applicants 
are Affiliates, as such term is defined in the allocation application. 
If an applicant and its Affiliates wish to submit allocation 
applications, they must do so collectively, in one application; an 
applicant and its Affiliates may not submit separate allocation 
applications. If Affiliated entities submit multiple applications, the 
CDFI Fund reserves the right either to reject all such applications 
received or to select a single application as the only application 
considered for an allocation. In the case of governmental entities, the 
CDFI Fund may accept applications submitted by Affiliated entities, but 
only to the extent the CDFI Fund determines that the business 
strategies and/or activities described in such applications, submitted 
by separate entities, are distinctly dissimilar and are operated and/or 
managed by distinctly dissimilar boards and staff, including identified 
consultants. In such cases, the CDFI Fund reserves the right to limit 
award amounts to such entities to ensure that the entities do not 
collectively receive more than the $125 million cap.
    For purposes of this NOAA, in addition to assessing whether 
applicants meet the definition of the term ``Affiliate'' found in the 
allocation application, the CDFI Fund will consider: (i) Whether the 
activities described in applications submitted by separate entities 
are, or will be, operated and/or managed as a common enterprise that, 
in fact or effect, may be viewed as a single entity; (ii) whether the 
applications submitted by separate entities contain significant 
narrative, textual or other similarities, and (iii) whether the 
business strategies and/or activities described in applications 
submitted by separate entities are so closely related, in fact or 
effect, they may be viewed as substantially identical applications. In 
such cases, the CDFI Fund reserves the right either to reject all 
applications received from all such entities; to select a single 
application as the only one that will be considered for an allocation; 
and, in the event that an Application is selected to receive an 
allocation award, to deem certain activities ineligible. These 
requirements shall apply to all applicants, including those that are 
Affiliated with governmental entities.
    (b) Furthermore, an applicant that receives an allocation in this 
allocation round (or its Subsidiary transferee) may not become an 
Affiliate of or member of a common enterprise (as defined above) with 
another applicant that receives an allocation in this allocation round 
(or its Subsidiary transferee) at any time after the submission of an 
allocation application under this NOAA. This prohibition, however, 
generally does not apply to entities that are commonly Controlled 
solely because of common ownership by QEI investors. This requirement 
will also be a term and condition of the Allocation Agreement (see 
Section VI.B of this NOAA and additional application guidance materials 
on the CDFI Fund's Web site at http://www.cdfifund.gov for more 
details).
    6. Entities created as a series of funds: An applicant whose 
business structure consists of an entity with a series of funds must 
apply for CDE certification for each fund. If such an applicant 
represents that it is properly classified for Federal tax purposes as a 
single partnership or corporation, it may apply for CDE certification 
as a single entity. If an applicant represents that it is properly 
classified for Federal tax purposes as multiple partnerships or 
corporations, then it must submit a CDE certification application for 
the applicant and each fund it would like to participate in the NMTC 
Program, and each fund must be separately certified as a CDE. 
Applicants should note, however, that receipt of CDE certification as a 
single entity or as multiple entities is not a determination that an 
applicant and its related funds are properly classified as a single 
entity or as multiple entities for Federal tax purposes. Regardless of 
whether the series of funds is classified as a single partnership or 
corporation or as multiple partnerships or corporations, an applicant 
may not transfer any NMTC allocations it receives to one or more of its 
funds unless the fund is a certified CDE that is a Subsidiary of the 
applicant, enjoined to the Allocation Agreement as a Subsidiary 
Allocatee.
    7. Entities that are BEA Program awardees: An insured depository 
institution investor (and its Affiliates and Subsidiaries) may not 
receive a NMTC allocation in addition to a BEA Program award for the 
same investment in a CDE. Likewise, an insured depository institution 
investor (and its Affiliates and Subsidiaries) may not receive a BEA 
Program award in addition to a NMTC allocation for the same investment 
in a CDE.

IV. Application And Submission Information

    A. Address to request application package: Applicants must submit 
applications electronically under this NOAA, through the CDFI Fund Web 
site. Following the publication of this NOAA, the CDFI Fund will make 
the electronic allocation application available on its Web site at 
http://www.cdfifund.gov. Applications sent by mail, facsimile or other 
form will not be accepted. Please note the CDFI Fund will only accept 
the application and attachments (i.e., the Applicant's authorized 
representative signature page, the Controlling Entity's representative 
signature page, investor letters and organizational charts) in 
electronic form.
    B. Application content requirements: Detailed application content 
requirements are found in the application related to this NOAA. 
Applicants must submit all materials described in and required by the 
application by the applicable deadlines. Applicants will not be 
afforded an opportunity to provide any missing materials or 
documentation. Electronic applications must be submitted solely by 
using the format made available at the CDFI Fund's Web site. Additional 
information, including instructions relating to the submission of 
supporting information (i.e., the Applicant's authorized representative 
signature page, the Controlling Entity's representative signature page, 
investor

[[Page 45609]]

letters and organizational charts), is set forth in further detail in 
the electronic application. An application must include a valid and 
current Employer Identification Number (EIN) issued by the Internal 
Revenue Service (IRS) and assigned to the applicant and, if applicable, 
its Controlling Entity. Electronic applications without a valid EIN are 
incomplete and cannot be transmitted to the CDFI Fund. For more 
information on obtaining an EIN, please contact the IRS at (800) 829-
4933 or www.irs.gov.
    An applicant may not submit more than one application in response 
to this NOAA. In addition, as stated in Section III.A.4 of this NOAA, 
an applicant and its Affiliates must collectively submit only one 
allocation application; an applicant and its Affiliates may not submit 
separate allocation applications except as outlined above. Once an 
application is submitted, an applicant will not be allowed to change 
any element of its application.
    C. Form of application submission: Applicants may only submit 
applications under this NOAA electronically. Applications sent by 
facsimile or by email will not be accepted. Submission of an electronic 
application will facilitate the processing and review of applications 
and the selection of Allocatees; further, it will assist the CDFI Fund 
in the implementation of electronic reporting requirements.
    1. Electronic applications: Electronic applications must be 
submitted solely by using the CDFI Fund's Web site and must be sent in 
accordance with the submission instructions provided in the electronic 
application form. The CDFI Fund recommends use of Internet Explorer 
version 8 on a Microsoft Windows-based computer, and optimally at least 
a 56Kbps Internet connection in order to meet the electronic 
application submission requirements. Use of other browsers (i.e., 
Firefox), other versions of Internet Explorer, or other systems (i.e., 
Mac) might result in problems during submission of the application. The 
CDFI Fund's electronic application system will only permit the 
submission of applications in which all required questions and tables 
are fully completed. Additional information, including instructions 
relating to the submission of supporting information (i.e., the 
applicant's authorized representative signature page, the Controlling 
Entity's representative signature page, investor letters and 
organizational charts) is set forth in further detail in the electronic 
application and the Online Application Instructions for this Round.
    D. Application submission dates and times:
    1. Application deadlines:
    (a) Electronic applications: must be received by 5:00 p.m. ET on 
September 18, 2013. Electronic applications cannot be transmitted or 
received after 5:00 p.m. ET on September 18, 2013. In addition, 
applicants must separately submit supporting information (i.e., the 
applicant's authorized representative signature page, the Controlling 
Entity's representative signature page, investor letters and 
organizational charts) via their myCDFIFund account. The applicant's 
authorized representative signature page, the Controlling Entity's 
representative signature page, investor letters and organizational 
charts must be submitted on or before 11:59 p.m. on September 20, 2013. 
Attachments may not exceed a size limit of 5 megabytes (MB). See 
application instructions, provided in the electronic application and 
the Round Allocation Application Q&A, for further detail. Applications 
and other required documents received after this date and time will be 
rejected. If the applicant's authorized representative signature page 
is not received by the deadline specified above, the CDFI Fund reserves 
the right to reject the application. Please note that the document 
submission deadlines in this NOAA and/or the allocation application are 
strictly enforced.
    (b) Postmark: For purposes of this NOAA, the term ``Postmark'' is 
defined by 26 CFR 301.7502-1. In general, the CDFI Fund will require 
that the Postmarked document bears a Postmark date that is on or before 
the applicable deadline. The document must be in an envelope or other 
appropriate wrapper, properly addressed as set forth in this NOAA and 
delivered by the United States Postal Service or any other private 
delivery service designated by the Secretary of the Treasury. For more 
information on designated delivery services, please see IRS Notice 
2002-62, 2002-2 C.B. 574.
    E. Intergovernmental Review: Not applicable.
    F. Funding Restrictions: For allowable uses of investment proceeds 
related to a NMTC allocation, please see 26 U.S.C. 45D and the final 
regulations issued by the Internal Revenue Service (26 CFR 1.45D-1, 
published December 28, 2004) and related guidance. Please see Section 
I, above, for the Programmatic Changes of this NOAA.
    G. Paperwork Reduction: Under the Paperwork Reduction Act (44 
U.S.C. chapter 35), an agency may not conduct or sponsor a collection 
of information, and an individual is not required to respond to a 
collection of information, unless it displays a valid OMB control 
number. Pursuant to the Paperwork Reduction Act, the application has 
been assigned the following control number: 1559-0016.

V. Application Review Information

    There are two parts to the substantive review process for each 
allocation application: Phase 1 and Phase 2. In Phase 1, the CDFI Fund 
will evaluate each application, assigning points and numeric scores 
according to the criteria described below. In Phase 2, the CDFI Fund 
will rank applicants in accordance with the procedures set forth below.
    A. Criteria:
    1. Business Strategy (25-point maximum): (a) When assessing an 
applicant's business strategy, reviewers will consider, among other 
things: the applicant's products, services and investment criteria; the 
prior performance of the applicant or its Controlling Entity, 
particularly as it relates to making similar kinds of investments as 
those it proposes to make with the proceeds of QEIs; the applicant's 
prior performance in providing capital or technical assistance to 
disadvantaged businesses or communities; the projected level of the 
applicant's pipeline of potential investments; the extent to which the 
applicant intends to make QLICIs in one or more businesses in which 
persons unrelated to the entity hold a majority equity interest; how 
NMTCs will enable the applicant to create additional value to its 
financing activities in Low-Income Communities; and the extent to which 
applicants that otherwise have notable relationships with the Qualified 
Active Low Income Community Businesses (QALICBs) financed will create 
benefits (beyond those created in the normal course of a NMTC 
transaction) to Low-Income Communities.
    Under the Business Strategy criterion, an applicant will generally 
score well to the extent that it will deploy debt or investment capital 
in products or services which are flexible or non-traditional in form 
and on better terms than available in the marketplace. An applicant 
will also score well to the extent that, among other things, it: (i) 
Has a track record of successfully deploying products and services 
similar to those it intends to provide with the proceeds of QEIs; (ii) 
has identified, or has a process for identifying, potential 
transactions; (iii) demonstrates a likelihood of issuing QEIs and 
making the related QLICIs in a time period that is significantly 
shorter than the 5-year period permitted under IRC Sec.  45D(b)(1);

[[Page 45610]]

(iv) in the case of an applicant proposing to purchase loans from CDEs, 
the applicant will require the CDE selling such loans to re-invest the 
proceeds of the loan sale to provide additional products and services 
to Low-Income Communities.
    (b) Priority Points: In addition, as provided by IRC Sec.  
45D(f)(2), the CDFI Fund will ascribe additional points to entities 
that meet one or both of the statutory priorities. First, the CDFI Fund 
will give up to five (5) additional points to any applicant that has a 
record of having successfully provided capital or technical assistance 
to disadvantaged businesses or communities. Second, the CDFI Fund will 
give five (5) additional points to any applicant that intends to 
satisfy the requirement of IRC Sec.  45D(b)(1)(B) by making QLICIs in 
one or more businesses in which persons unrelated (within the meaning 
of IRC Sec.  267(b) or IRC Sec.  707(b)(1)) to an applicant (or the 
applicant's subsidiary CDEs) hold the majority equity interest. 
Applicants may earn points for one or both statutory priorities. Thus, 
applicants that meet the requirements of both priority categories can 
receive up to a total of ten (10) additional points. A record of having 
successfully provided capital or technical assistance to disadvantaged 
businesses or communities may be demonstrated either by the past 
actions of an applicant itself or by its Controlling Entity (i.e., 
where a new CDE is established by a nonprofit corporation with a 
history of providing assistance to disadvantaged communities). An 
applicant that receives additional points for intending to make 
investments in unrelated businesses and is awarded a NMTC allocation 
must meet the requirements of IRC Sec.  45D(b)(1)(B) by investing 
substantially all of the proceeds from its QEIs in unrelated 
businesses. The CDFI Fund will factor in an applicant's priority points 
when ranking applicants during Phase 2 of the review process, as 
described below.
    2. Community Outcomes (25-point maximum): In assessing the 
potential benefits to Low-Income Communities that may result from the 
applicant's proposed investments, reviewers will consider, among other 
things, the degree to which the applicant is likely to: (i) Achieve 
significant and measurable community development outcomes in its Low-
Income Communities; (ii) invest in particularly economically distressed 
markets: (iii) engage with local communities regarding investments; and 
(iv) demonstrate a track record of investing in businesses that spur 
additional private capital investment in Low-Income Communities. An 
applicant will generally score well under this section to the extent 
that: (a) it articulates how its strategy is likely to produce 
significant and measurable community development outcomes that would 
not be achieved without NMTCs; (b) it is working in particularly 
economically distressed or otherwise underserved communities; (c) its 
activities are part of a broader neighborhood revitalization strategy; 
(d) it ensures that an investment into a project or business is 
supported by and will be beneficial to the surrounding community; and 
(e) it is likely to engage in activities that will spur additional 
private capital investment.
    3. Management Capacity (25-point maximum): In assessing an 
applicant's management capacity, reviewers will consider, among other 
things, the qualifications of the applicant's principals, its board 
members, its management team, and other essential staff or contractors, 
with specific focus on: experience in deploying capital or technical 
assistance, including activities similar to those described in the 
applicant's business strategy; asset management and risk management 
experience; experience with fulfilling compliance requirements of other 
governmental programs, including other tax programs; and the 
applicant's (or its Controlling Entity's) financial health. Reviewers 
will also consider the extent to which an applicant has protocols in 
place to ensure ongoing compliance with NMTC Program requirements and 
the level of involvement of community representatives in the Governing 
Board and/or Advisory Board in approving investment criteria or 
decisions.
    An applicant will generally score well under this section to the 
extent that its management team or other essential personnel have 
experience in: (a) Deploying capital or technical assistance in Low-
Income Communities, particularly those likely to be served by the 
applicant with the proceeds of QEIs; (b) asset and risk management; and 
(c) fulfilling government compliance requirements, particularly tax 
credit program compliance. An applicant will also score well to the 
extent it demonstrates strong financial health and a high likelihood of 
remaining a going-concern; has policies and systems in place to ensure 
ongoing compliance with NMTC Program requirements; has Low-Income 
Community representatives in the Governing Board and/or Advisory Board 
that play an active role in designing or implementing its investment 
criteria and/or decisions; and, if it is a Federally-insured financial 
institution, its most recent Community Reinvestment Act (CRA) rating 
was ``outstanding.''
    4. Capitalization Strategy (25-point maximum): When assessing an 
applicant's capitalization strategy, reviewers will consider, among 
other things: the key personnel of the applicant (or Controlling 
Entity) and their track record of raising capital, particularly from 
for-profit investors; the extent to which the applicant has secured 
investments, commitments to invest in NMTC, or indications of investor 
interest commensurate with its requested amount of tax credit 
allocations; the applicant's strategy for identifying additional 
investors, if necessary, including the applicant's (or its Controlling 
Entity's) prior performance with raising equity from investors, 
particularly for-profit investors; the distribution of the economic 
benefits of the tax credit; the extent to which the applicant intends 
to invest the proceeds from the aggregate amount of its QEIs at a level 
that exceeds the requirements of IRC Sec.  45D(b)(1)(B) and the IRS 
regulations; the likelihood the applicant will raise sufficient capital 
to finance its cost of operations; and the applicant's timeline for 
utilizing an NMTC allocation.
    An applicant will generally score well under this section to the 
extent that: (a) It has secured investor commitments, or has a 
reasonable strategy for obtaining such commitments; (b) its request for 
allocations is commensurate with both the level of QEIs it is likely to 
raise and its expected investment strategy to deploy funds raised with 
NMTCs; (c) it generally demonstrates that the economic benefits of the 
tax credit will be passed through to a QALICB; (d) it is likely to 
secure capital to finance its cost of operations consistent with the 
applicant's overall business strategy and timeline for making 
investments; and (e) it intends to invest the proceeds from the 
aggregate amount of its QEIs at a level that exceeds the requirements 
of IRC Sec.  45D(b)(1)(B) and the IRS regulations. In the case of an 
applicant proposing to raise investor funds from organizations that 
also will identify or originate transactions for the applicant or from 
Affiliated entities, said applicant will score well to the extent that 
it will offer products with more favorable rates or terms than those 
currently offered by its investor(s) or Affiliated entities and/or will 
target its activities to areas of greater economic distress than those 
currently targeted by the investor or Affiliated entities.
    B. Review and selection process: All allocation applications will 
be reviewed for eligibility and completeness. The CDFI Fund may consult 
with the IRS on

[[Page 45611]]

the eligibility requirements under IRC Sec.  45D. To be complete, the 
application must contain, at a minimum, all information described as 
required in the application form. An incomplete application will be 
rejected. Once the application has been determined to be eligible and 
complete, the CDFI Fund will conduct the substantive review of each 
application in two parts (Phase 1 and Phase 2) in accordance with the 
criteria and procedures generally described in this NOAA and the 
allocation application.
    1. Phase 1: Reviewers will evaluate and score each application in 
the first part of the review process. An applicant must exceed a 
minimum overall aggregate base score threshold and exceed a minimum 
aggregate section score threshold in each of the four application 
sections (Business Strategy, Community Outcomes, Management Capacity, 
and Capitalization Strategy) in order to advance from the first part of 
the substantive review process. If, in the case of a particular 
application, a reviewer's total base score or section score(s) (in one 
or more of the four application scored sections) varies significantly 
from other reviewers' total base scores or section scores for such 
application, the CDFI Fund may, in its sole discretion, obtain the 
comments and recommendations of an additional reviewer to determine 
whether the anomalous score should be replaced with the score of the 
additional reviewer.
    2. Phase 2: Once the CDFI Fund has determined which applicants have 
met the required minimum overall aggregate base score and aggregate 
section score thresholds, the CDFI Fund will rank applicants on the 
basis of their combined scores in the Business Strategy and Community 
Outcomes sections of the application and will make adjustments to each 
applicant's priority points so that these points maintain the same 
relative weight in the ranking of applicant scores in Phase 2 as in 
Phase 1. The CDFI Fund will award allocations in the order of this 
``Final Rank Score,'' subject to applicants' meeting all other 
eligibility requirements; provided, however, that the CDFI Fund, in its 
sole discretion, reserves the right to reject an application and/or 
adjust award amounts as appropriate based on information obtained 
during the review process. Most notably, in the cases of applicants (or 
their Affiliates) that are prior year Allocatees, the CDFI Fund will 
review the activities of the prior year Allocatee to determine whether 
the entity has: (a) effectively utilized its prior-year allocations; 
and (b) substantiated a need for additional allocation authority.
    3. Late Reports: In the case of an applicant, or Affiliates, that 
has previously received an award or allocation from the CDFI Fund 
through any CDFI Fund program, the CDFI Fund will deduct points for the 
applicant's (or its Affiliate's) failure to meet the reporting 
deadlines set forth in any assistance, award or Allocation Agreement(s) 
with the CDFI Fund during the entity's two complete fiscal years prior 
to the application deadline of this NOAA (generally FY 2011 and FY 
2012).
    C. Allocations serving Non-Metropolitan counties: As provided for 
under Section 102(b) of the Tax Relief and Health Care Act of 2006 (P. 
L. 109-432), the CDFI Fund shall ensure that non-metropolitan counties 
receive a proportional allocation of QEIs under the NMTC Program. To 
this end, the CDFI Fund will ensure that the proportion of Allocatees 
that are Rural CDEs is, at a minimum, equal to the proportion of 
applicants in the Phase 2 review pool that are Rural CDEs. The CDFI 
Fund will also endeavor to ensure that 20 percent of the QLICIs to be 
made using QEI proceeds are invested in Non-Metropolitan counties. A 
Rural CDE is one that has made direct investments in at least three of 
the past five years, over the past five years dedicated at least 50 
percent of its direct financing dollars to Non-Metropolitan counties, 
and has committed that at least 50 percent of its NMTC financing 
dollars with this Allocation will be deployed in such areas. Non-
Metropolitan counties are counties not contained within a Metropolitan 
Statistical Area, as such term is defined in OMB Bulletin No. 10-02 
(Update of Statistical Area Definitions and Guidance on Their Uses) and 
applied using 2010 census tracts.
    Applicants that meet the minimum scoring thresholds will be 
advanced to Phase 2 review and will be provided with ``preliminary'' 
awards, in descending order of Final Rank Score, until the available 
allocation authority is fulfilled. Once these ``preliminary'' award 
amounts are determined, the CDFI Fund will then analyze the Allocatee 
pool to determine whether the two Non-Metropolitan proportionality 
objectives have been met.
    The CDFI Fund will first examine the ``preliminary'' awards and 
Allocatees to determine whether the percentage of Allocatees that are 
Rural CDEs is, at a minimum, equal to the percentage of applicants in 
the Phase 2 review pool that are Rural CDEs. If this objective is not 
achieved, the CDFI Fund will provide awards to additional Rural CDEs 
from the Phase 2 pool, in descending order of their Final Rank Score, 
until the appropriate percentage balance is achieved. In order to 
accommodate the additional Allocatees within the available allocation 
limitations, a formula reduction will be applied uniformly to the 
allocation amount for all Allocatees in the pool.
    The CDFI Fund will then determine whether the pool of Allocatees 
will, in the aggregate, invest at least 20 percent of their QLICIs (as 
measured by dollar amount) in Non-Metropolitan counties. The CDFI Fund 
will first apply the ``minimum'' percentage of QLICIs that Allocatees 
indicated in their applications would be targeted to Non-Metropolitan 
areas to the total allocation award amount of each Allocatee (less 
whatever percentage the Allocatee indicated would be retained for non-
QLICI activities), and total these figures for all Allocatees. If this 
aggregate total is greater than or equal to 20 percent of the QLICIs to 
be made by the Allocatees, then the pool is considered balanced and the 
CDFI Fund will proceed with the allocation process. However, if the 
aggregate total is less than 20 percent of the QLICIs to be made by the 
Allocatees, the CDFI Fund will consider requiring any or all of the 
Allocatees to direct up to the ``maximum'' percentage of QLICIs that 
the Allocatees indicated would be targeted to Non-Metropolitan 
counties, taking into consideration their track record and ability to 
deploy dollars in Non-Metropolitan counties. If the CDFI Fund cannot 
meet the goal of 20 percent of QLICIs in Non-Metropolitan counties by 
requiring any or all Allocatees to commit up to the maximum percentage 
of QLICIs that they indicated would be targeted to Non-Metropolitan 
counties, the CDFI Fund may add additional Rural CDEs (in descending 
order of final rank score) to the Allocatee pool. In order to 
accommodate any additional Allocatees within the allocation 
limitations, a formula reduction will be applied as uniformly as 
possible, to the allocation amount for all Allocatees in the pool that 
have not committed to investing at least 20 percent of their QLICIs in 
Non-Metropolitan counties.
    D. Questions: All outstanding reports or compliance questions 
should be directed to the Certification, Compliance Monitoring and 
Evaluation Manager by email at [email protected]; by telephone at 
(202) 653-0423; or by mail to CDFI Fund, CCME Unit, Attention: 
Compliance, Department of the Treasury, 1500 Pennsylvania Avenue NW., 
Washington, DC 20220. The CDFI Fund will respond to reporting or

[[Page 45612]]

compliance questions between the hours of 9:00 a.m. and 5:00 p.m. ET, 
starting the date of the publication of this NOAA through September 16, 
2013. The CDFI Fund will not respond to reporting or compliance phone 
calls or email inquiries that are received after 5:00 p.m. ET on 
September 16, 2013 until after the funding application deadline of 
September 18, 2013.
    E. Right of rejection: The CDFI Fund reserves the right to reject 
any NMTC allocation application in the case of a prior CDFI Fund 
awardee, if such applicant has failed to comply with the terms, 
conditions, and other requirements of the prior or existing assistance 
or award agreement(s) with the CDFI Fund. The CDFI Fund reserves the 
right to reject any NMTC allocation application in the case of a prior 
CDFI Fund Allocatee, if such applicant has failed to comply with the 
terms, conditions, and other requirements of its prior or existing 
Allocation Agreement(s) with the CDFI Fund. The CDFI Fund reserves the 
right to reject any NMTC allocation application in the case of any 
applicant, if an Affiliate of the applicant has failed to meet the 
terms, conditions and other requirements of any prior or existing 
assistance agreement, award agreement or Allocation Agreement with the 
CDFI Fund.
    The CDFI Fund reserves the right to reject any NMTC allocation 
application in the case of a prior CDFI Fund Allocatee, if such 
applicant has failed to use its prior NMTC allocation(s) in a manner 
that is generally consistent with the business strategy (including, but 
not limited to, the proposed product offerings, QALICB type, and 
markets served) set forth in the allocation application(s) related to 
such prior allocation(s). The CDFI Fund also reserves the right to 
reject any NMTC allocation application in the case of an Affiliate of 
the applicant that is a prior CDFI Fund Allocatee and has failed to use 
its prior NMTC allocation(s) in a manner that is generally consistent 
with the business strategy set forth in the allocation application(s) 
related to such prior allocation(s).
    The CDFI Fund reserves the right to reject an NMTC allocation 
application if information (including administrative errors or omission 
of information) comes to the attention of the CDFI Fund that adversely 
affects an applicant's eligibility for an award, adversely affects the 
CDFI Fund's evaluation or scoring of an application, adversely affects 
the CDFI Fund's prior determinations of CDE certification, or indicates 
fraud or mismanagement on the part of an applicant or the Controlling 
Entity, if such fraud or mismanagement by the Controlling Entity would 
hinder the applicant's ability to perform under the Allocation 
Agreement. If the CDFI Fund determines that any portion of the 
application is incorrect in any material respect, the CDFI Fund 
reserves the right, in its sole discretion, to reject the application.
    As a part of the substantive review process, the CDFI Fund may 
permit the Allocation Recommendation Panel member(s) to request 
information from applicants for the sole purpose of obtaining, 
clarifying or confirming application information or omission of 
information. In no event shall such contact be construed to permit an 
applicant to change any element of its application. At this point in 
the process, an applicant may be required to submit additional 
information about its application in order to assist the CDFI Fund with 
its final evaluation process. Such requests must be responded to within 
the time parameters set by the CDFI Fund. The selecting official(s) 
will make a final allocation determination based on an applicant's 
file, including, without limitation, eligibility under IRCSec.  45D, 
the reviewers' scores and the amount of allocation authority available. 
In the case of applicants (or Affiliates of applicants) that are 
regulated by the Federal government or a State agency (or comparable 
entity), the CDFI Fund's selecting official(s) reserve(s) the right to 
consult with and take into consideration the views of the appropriate 
Federal or State banking and other regulatory agencies. In the case of 
applicants (or Affiliates of applicants) that are also Small Business 
Investment Companies, Specialized Small Business Investment Companies 
or New Markets Venture Capital Companies, the CDFI Fund reserves the 
right to consult with and take into consideration the views of the 
Small Business Administration.
    The CDFI Fund reserves the right to conduct additional due 
diligence, as determined reasonable and appropriate by the CDFI Fund, 
in its sole discretion, related to the applicant, Affiliates, the 
applicant's Controlling Entity and the officers, directors, owners, 
partners and key employees of each.
    Each applicant will be informed of the CDFI Fund's award decision 
through an electronic notification whether selected for an allocation 
or not selected for an allocation, which may be for reasons of 
application incompleteness, ineligibility or substantive issues. All 
applicants that are not selected for an allocation based on substantive 
issues will likely be given the opportunity to obtain feedback on their 
applications. This feedback will be provided in a format and within a 
timeframe to be determined by the CDFI Fund, based on available 
resources.
    The CDFI Fund further reserves the right to change its eligibility 
and evaluation criteria and procedures, if the CDFI Fund deems it 
appropriate. If said changes materially affect the CDFI Fund's award 
decisions, the CDFI Fund will provide information regarding the changes 
through the CDFI Fund's Web site.
    There is no right to appeal the CDFI Fund's NMTC allocation 
decisions. The CDFI Fund's NMTC allocation decisions are final.

VI. Award Administration Information

    A. Allocation Award Compliance:
    1. Failure to meet reporting requirements: If an Allocatee, or an 
Affiliate of an Allocatee, is a prior CDFI Fund awardee or Allocatee 
under any CDFI Fund program and is not current on the reporting 
requirements set forth in the previously executed assistance, 
allocation or award agreement(s), as of the date of the NOA or 
thereafter, the CDFI Fund reserves the right, in its sole discretion, 
to reject the application, delay entering into an Allocation Agreement, 
and/or impose limitations on an Allocatee's ability to issue QEIs to 
investors until said prior awardee or Allocatee is current on the 
reporting requirements in the previously executed assistance, 
allocation or award agreement(s). Please note that the CDFI Fund only 
acknowledges the receipt of reports that are complete. As such, 
incomplete reports or reports that are deficient of required elements 
will not be recognized as having been received. If said prior awardee 
or Allocatee is unable to meet this requirement within the timeframe 
set by the CDFI Fund, the CDFI Fund reserves the right, in its sole 
discretion, to terminate and rescind the allocation made under this 
NOAA.
    2. Pending determination of noncompliance or default: If an 
Allocatee is a prior awardee or Allocatee under any CDFI Fund program 
and if: (i) It has submitted complete and timely reports to the CDFI 
Fund that demonstrate noncompliance with or a default of a previous 
assistance, award or Allocation Agreement; and (ii) the CDFI Fund has 
yet to make a final determination as to whether the entity is in 
noncompliance or default of its previous assistance, award or 
Allocation Agreement, the CDFI Fund reserves the right, in its sole 
discretion, to delay entering into an Allocation Agreement and/or to 
impose limitations on the Allocatee's ability to issue Qualified Equity 
Investments to investors, pending final determination of whether the 
entity is in noncompliance or

[[Page 45613]]

default, and determination of remedies, if applicable, in the sole 
determination of the CDFI Fund. Further, if an Affiliate of an 
Allocatee is a prior CDFI Fund awardee or Allocatee and if such entity: 
(i) Has submitted complete and timely reports to the CDFI Fund that 
demonstrate noncompliance with a previous assistance, award or 
Allocation Agreement; and (ii) the CDFI Fund has yet to make a final 
determination as to whether the entity is in default of its previous 
assistance, award or Allocation Agreement, the CDFI Fund reserves the 
right, in its sole discretion, to delay entering into an Allocation 
Agreement and/or to impose limitations on the Allocatee's ability to 
issue QEIs to investors, pending final determination of whether the 
entity is in noncompliance or default, and determination of remedies, 
if applicable, in the sole determination of the CDFI Fund. If the prior 
awardee or Allocatee in question is unable to satisfactorily resolve 
the issues of noncompliance, in the sole determination of the CDFI 
Fund, the CDFI Fund reserves the right, in its sole discretion, to 
terminate and rescind the award notification made under this NOAA.
    3. Default status: If, at any time prior to entering into an 
Allocation Agreement through this NOAA, the CDFI Fund has made a 
determination that an Allocatee that is a prior CDFI Fund awardee or 
Allocatee under any CDFI Fund program is in default of a previously 
executed assistance, allocation or award agreement(s) and has provided 
written notification of such determination to the Allocatee, the CDFI 
Fund reserves the right, in its sole discretion, to reject the 
application, rescind the award, delay entering into an Allocation 
Agreement and/or to impose limitations in the Allocation Agreement, 
including but not limited to, the Allocatee's ability to issue QEIs to 
investors, until said prior awardee or Allocatee has cured the default 
by taking actions necessary as specified by the CDFI Fund and within 
the timeframe specified by the CDFI Fund. Further, if at any time prior 
to entering into an Allocation Agreement through this NOAA, the CDFI 
Fund has made a determination that an Affiliate of the Allocatee is a 
prior CDFI Fund awardee or Allocatee under any CDFI Fund program and is 
in default of a previously executed assistance, allocation or award 
agreement(s) and has provided written notification of such 
determination to the defaulting entity, the CDFI Fund reserves the 
right, in its sole discretion, reject the application, rescind the 
award, to delay entering into an Allocation Agreement and/or to impose 
limitations in the Allocation Agreement, including but not limited to, 
the Allocatee's ability to issue QEIs to investors, until said prior 
awardee or Allocatee has cured the default by taking actions necessary 
as specified by the CDFI Fund and within the timeframe specified by the 
CDFI Fund. If said prior awardee or Allocatee is unable to meet this 
requirement, the CDFI Fund reserves the right, in its sole discretion, 
to terminate and rescind the Notice of Allocation and the allocation 
made under this NOAA.
    4. Termination in default: If prior to entering into an Allocation 
Agreement through this NOAA: (i) The CDFI Fund has made a determination 
that an Allocatee that is a prior CDFI Fund awardee or Allocatee under 
any CDFI Fund program whose award or allocation was terminated in 
default of such prior agreement; (ii) the CDFI Fund has provided 
written notification of such determination to such organization; and 
(iii) the anticipated date for entering into an Allocation Agreement is 
within a period of time specified in such notification throughout which 
any new award, allocation, or assistance is prohibited, the CDFI Fund 
reserves the right, in its sole discretion, to delay entering into an 
Allocation Agreement and/or to impose limitations on the Allocatee's 
ability to issue QEIs to investors, or to terminate and rescind the 
Notice of Allocation and the allocation made under this NOAA. 
Furthermore, if prior to entering into an Allocation Agreement through 
this NOAA: (i) The CDFI Fund has made a determination that an Affiliate 
of the Allocatee is a prior CDFI Fund awardee or Allocatee under any 
CDFI Fund program whose award or allocation was terminated in default 
of such prior agreement; (ii) the CDFI Fund has provided written 
notification of such determination to the defaulting entity; and (iii) 
the anticipated date for entering into an Allocation Agreement is 
within a period of time specified in such notification throughout which 
any new award, allocation, or assistance is prohibited, the CDFI Fund 
reserves the right, in its sole discretion, to delay entering into an 
Allocation Agreement and/or to impose limitations on the Allocatee's 
ability to issue QEIs to investors, or to terminate and rescind the 
Notice of Allocation and the allocation made under this NOAA.
    B. Allocation Agreement: Each applicant that is selected to receive 
a NMTC allocation (including the applicant's Subsidiary transferees) 
must enter into an Allocation Agreement with the CDFI Fund. The 
Allocation Agreement will set forth certain required terms and 
conditions of the NMTC allocation which may include, but are not 
limited to, the following: (i) The amount of the awarded NMTC 
allocation; (ii) the approved uses of the awarded NMTC allocation 
(i.e., loans to or equity investments in Qualified Active Low-Income 
Businesses or loans to or equity investments in other CDEs); (iii) the 
approved service area(s) in which the proceeds of QEIs may be used, 
including the dollar amount of QLICIs that must be invested in Non-
Metropolitan counties; (iv) the time period by which the applicant may 
obtain QEIs from investors; (v) reporting requirements for all 
applicants receiving NMTC allocations; and (vi) a requirement to 
maintain certification as a CDE throughout the term of the Allocation 
Agreement. If an applicant has represented in its NMTC allocation 
application that it intends to invest substantially all of the proceeds 
from its investors in businesses in which persons unrelated to the 
applicant hold a majority equity interest, the Allocation Agreement 
will contain a covenant whereby said applicant agrees that it will 
invest substantially all of said proceeds in businesses in which 
persons unrelated to the applicant hold a majority equity interest.
    In addition to entering into an Allocation Agreement, each 
applicant selected to receive a NMTC allocation must furnish to the 
CDFI Fund an opinion from its legal counsel or a similar certification, 
the content of which will be further specified in the Allocation 
Agreement, to include, among other matters, an opinion that an 
applicant (and its Subsidiary transferees, if any): (i) Is duly formed 
and in good standing in the jurisdiction in which it was formed and the 
jurisdiction(s) in which it operates; (ii) has the authority to enter 
into the Allocation Agreement and undertake the activities that are 
specified therein; (iii) has no pending or threatened litigation that 
would materially affect its ability to enter into and carry out the 
activities specified in the Allocation Agreement; and (iv) is not in 
default of its articles of incorporation, bylaws or other 
organizational documents, or any agreements with the Federal 
government.
    If an Allocatee identifies Subsidiary transferees, the CDFI Fund 
reserves the right to require an Allocatee to provide supporting 
documentation evidencing that it Controls such entities prior to 
entering into an Allocation Agreement with the Allocatee and its 
Subsidiary transferees. The CDFI Fund reserves the right, in its sole 
discretion, to rescind its

[[Page 45614]]

allocation award if the Allocatee fails to return the Allocation 
Agreement, signed by the authorized representative of the Allocatee, 
and/or provide the CDFI Fund with any other requested documentation, 
within the deadlines set by the CDFI Fund.
    C. Fees: The CDFI Fund reserves the right, in accordance with 
applicable Federal law and if authorized, to charge allocation 
reservation and/or compliance monitoring fees to all entities receiving 
NMTC allocations. Prior to imposing any such fee, the CDFI Fund will 
publish additional information concerning the nature and amount of the 
fee.
    D. Reporting: The CDFI Fund will collect information, on at least 
an annual basis from all applicants that are awarded NMTC allocations 
and/or are recipients of QLICIs, including such audited financial 
statements and opinions of counsel as the CDFI Fund deems necessary or 
desirable, in its sole discretion. The CDFI Fund will use such 
information to monitor each Allocatee's compliance with the provisions 
of its Allocation Agreement and to assess the impact of the NMTC 
Program in Low-Income Communities. The CDFI Fund may also provide such 
information to the IRS in a manner consistent with IRC Sec.  6103 so 
that the IRS may determine, among other things, whether the Allocatee 
has used substantially all of the proceeds of each QEI raised through 
its NMTC allocation to make QLICIs. The Allocation Agreement shall 
further describe the Allocatee's reporting requirements.
    The CDFI Fund reserves the right, in its sole discretion, to modify 
these reporting requirements if it determines it to be appropriate and 
necessary; however, such reporting requirements will be modified only 
after due notice to Allocatees.

VII. Agency Contacts

    The CDFI Fund will provide programmatic and information technology 
support related to the allocation application between the hours of 9:00 
a.m. and 5:00 p.m. ET through September 16, 2013. The CDFI Fund will 
not respond to phone calls or emails concerning the application that 
are received after 5:00 p.m. ET on September 16, 2013 until after the 
allocation application deadline of September 18, 2013. Applications and 
other information regarding the CDFI Fund and its programs may be 
obtained from the CDFI Fund's Web site at http://www.cdfifund.gov. The 
CDFI Fund will post on its Web site responses to questions of general 
applicability regarding the NMTC Program.
    A. Information technology support: Technical support can be 
obtained by calling (202) 653-0422 or by email at 
[email protected]. People who have visual or mobility 
impairments that prevent them from accessing the Low-Income Community 
maps using the CDFI Fund's Web site should call (202) 653-0422 for 
assistance. These are not toll free numbers.
    B. Programmatic support: If you have any questions about the 
programmatic requirements of this NOAA, contact the CDFI Fund's NMTC 
Program Manager by email at [email protected]; or by telephone at 
(202) 653-0421. These are not toll-free numbers.
    C. Administrative support: If you have any questions regarding the 
administrative requirements of this NOAA, contact the CDFI Fund's NMTC 
Program Manager by email at [email protected], by telephone at 
(202) 653-0421. These are not toll free numbers.
    D. IRS support: For questions regarding the tax aspects of the NMTC 
Program, contact Jian Grant, Office of the Associate Chief Counsel 
(Passthroughs and Special Industries), IRS, by telephone at (202) 622-
3040, by facsimile at (202) 622-4753, or by mail at 1111 Constitution 
Avenue NW., Attn: CC:PSI:5, Washington, DC 20224. These are not toll 
free numbers.

VIII. Information Sessions

    In connection with this NOAA, the CDFI Fund may conduct one or more 
information sessions that will be produced in Washington, DC and 
broadcast over the internet via webcasting as well as telephone 
conference calls. For further information on these upcoming information 
sessions, please visit the CDFI Fund's Web site at http://www.cdfifund.gov.

    Authority:  26 U.S.C. 45D; 31 U.S.C. 321; 26 CFR 1.45D-1.

    Dated: July 24, 2013.
Donna J. Gambrell,
Director, Community Development Financial Institutions Fund.
[FR Doc. 2013-18140 Filed 7-26-13; 8:45 am]
BILLING CODE 4810-70-P