May 13, 2021
The economic fallout from COVID-19 has only heightened the need for targeted investment programs like the New Markets Tax Credit (NMTC) program.
Authorized by congress in 2000, the NMTC program has been an important source of financing for businesses and community facilities in some of the country’s most distressed rural and urban communities. The program has delivered nearly $110 billion in total financing to over 7,000 projects—creating over a million jobs nationwide.
Today, though the economy is improving, the recovery has not been equal. The ability for households in low-income communities to bounce back is much lower than those in higher-income areas. Among households making below $35,000 a year, 47 percent of adults report being behind on housing payments, and 25 percent report struggling to afford basic necessities such as food. Now more than ever, stabilizing and growing businesses in these communities – with the goal of driving good quality jobs with strong wages – is imperative. Our investments in connection with NMTCs have created more than 30,000 permanent jobs with average wages hovering above $50,000 a year, in low-income communities across the nation.
But the real proof of the program’s effectiveness is in the stories of the businesses, communities and people that have been impacted as a result of investments made in connection with the program.
E-Pak Manufacturing: Growing Jobs in Rural Northeastern Ohio
Located in rural Wooster, Ohio, E-Pak Manufacturing produces roll-off containers and trailers for the scrap metal industry. Throughout its three decades in business, the company has been a solid employer and a leader in the region’s manufacturing economy—even staying resilient through the pandemic, planning to add an additional 20 jobs in the next 12 months on top of its already 121-person strong workforce.
Following a NMTC investment in 2019, E-Pak added a third shift to support new growth opportunities. E-Pak provides critical training programs and tuition assistance, comprehensive benefits and strong pay – all hallmarks of a quality job. The company’s robust training program even includes welding, offering people across the region access to a highly transferable trade and helping to create a strong, sustainable workforce.
First Orion: Bringing Community Revitalization to North Little Rock
Arkansas-based software firm, First Orion is driving economic revitalization in its North Little Rock community. Since our initial investment, the company has created nearly 200 jobs–representing a 653% increase in its employee base since 2014. These jobs are helping to build a pipeline of local talent and address challenges inherent in distressed urban cores. The company’s technical apprenticeship program, offered not just to college grads but also individuals with high school degrees and/or work experience, exemplifies First Orion’s commitment to closing the skills gap and extending opportunity to low-income residents in the surrounding community to enter into a growing field.
After years of exceptional growth, First Orion sought to deepen its footprint and impact in its community by becoming the anchor tenant of a major redevelopment effort in North Little Rock—a community that has long suffered from blight and disinvestment. The move has brought with it additional hiring from the surrounding area, invigorating the local workforce and sparking additional growth. The company has enjoyed strong support from local and stat economic development agencies and officials, which has placed First Orion on the frontlines of urban renewal, while expanding equitable access to quality jobs in a promising tech field.
Modern MD: Opening up Medical Care to Underserved Communities
In New York City, Modern MD operates clinics in economically and medically underserved communities throughout Brooklyn and Queens where on average 20% or more of the population lives below the poverty line. When Advantage Capital initially invested in the company, Modern MD was set to open new service facilities. While the expansion was put on hold due to the pandemic, the company is moving full steam ahead, with three new facilities set to open in the near term—creating dozens of new jobs.
The critical services provided by Modern MD helps divert traffic away from emergency rooms, offering people a viable alternative for medical treatment. What’s more, patients are likely to be treated by a neighbor: the company is intentional in its efforts to hire locally, ensuring healthcare providers and workers better understand the needs of the community and its people, without cultural or language gaps.
In all, our investments made in connection with the NMTC program are delivering strong impacts in small businesses and local communities alike. Permanency for this program will ensure businesses in distressed communities have access to financing for years to come.
Want to know lean more about the impact of Advantage Capital’s investments across all of our lines of business? Download our 2020-2021 impact report here.
The investments, portfolio companies and recommendations listed on this website represent only a sample of companies that have received investment capital from Advantage Capital-related entities. It should not be assumed that recommendations made in the future will be profitable or will equal the performance of the securities highlighted herein or contained in any other information provided by Advantage Capital. Past performance is no guarantee of future results. For a full list of companies, please click here.
