JPMorgan Chase is dedicated to providing financial resources to underserved communities – Business Observer
Nicole Boone is a New Markets Tax Credit (NMTC) Community Development Banker at JPMorgan Chase in Los Angeles. Commercial Observer’s Partner Insights team spoke to her about how the NMTC program helps low-income communities in Los Angeles
Viewing Business Partner Perspectives: You have been with JPMorgan Chase for two years. Talk about how working there has added to your financial knowledge and career development.
Nicole Boon: This role allows me to do something I’m really passionate about, which is community development. Providing financial resources to underserved communities – helping people like me – is my life’s work. I also work with a group of smart and supportive colleagues, which encourages me to use my voice and perform at my best every day, which has helped me grow tremendously.
Why were you interested in working with the New Markets Tax Credit program?
When I had the opportunity to move to NMTC, I was excited to build a career in a field that was highly technical, but also focused on community development. I enjoy working with different types of clients, from large nonprofits and for-profits to small family organizations, and providing them with solutions tailored to their specific needs. You also have the opportunity to work with great investors and learn a lot about real estate and different types of products.
Talk about how you work with a group to help them through this process.
People come to us with projects they want to fund. We are the tax credit investors. We actually buy the tax credits which are used to provide the necessary subsidy to the project developer. Sometimes the transactions that come to us are fully prepared transactions. We play a more supportive and advisory role in these projects.
Are there different offers within the New Markets Tax Credit program?
We have two main offers. As a tax credit investor, we purchase tax credits from subsidiary community development entities. We pay equity in cash, and that equity eventually goes back to the project sponsor. We also have our own community development entity, where we put our own tax credit allocation into projects. This year, we were fortunate to receive $65 million in tax credits that we will use to support high-impact projects nationwide.
How essential is the program as a tool to empower low-income communities?
We have something in our industry that we call a “but for”, which says that without the tax credits, these projects could not proceed. So it is essential. Many of these projects are carried out by small non-profit or for-profit companies that do not have the financial resources to complete a project without some level of subsidy.
With the NMTC program, the subsidy varies, but generally around 15-20% of the total project costs are subsidized by these tax credits. For smaller nonprofits, it’s a reduction in their debt load or the fundraising they have to do, which ultimately allows them to reallocate resources to focus on what they need to do. they do best: provide services to low-income communities.
What type of projects does JPMorgan Chase attend?
We support a wide range of projects that help build the essential institutions and services communities need to thrive. We have worked on projects ranging from federally licensed health centers, schools and after-school programs, early childhood education programs and food banks to manufacturing companies that provide hundreds of jobs to communities at low income. We’ve also supported grocery stores and other healthy food retailers, housing, and even public infrastructure projects like parks.
What has been the most rewarding aspect of working in this field for you?
The most rewarding part of my job is seeing these high-impact projects get the support they need. It is truly rewarding to go to an underserved community that has never had access to a quality grocery store and see that your tax credit funding has provided access to fresh food.
JPMorgan Chase just committed $30 billion to advancing racial equity. Talk about this initiative.
In October, JPMorgan Chase announced a $30 billion business commitment over the next five years to drive an inclusive recovery, support employees and break down barriers of systemic racism. As part of this commitment, I lead a racial equity initiative specifically focused on Black-owned or controlled businesses, or businesses that serve a majority Black population. In this case, we are able to offer premium prizes to projects that meet our racial equity impact goals.
What sort of difference could the NMTC program make for low-income communities?
By nature, the NMTC program serves low-income communities. Given all that is happening around the plight of black Americans, this will allow us to focus specifically on them, which I believe is needed and long overdue. If we can offer higher prices, that will allow them to do more with the subsidy. I think it’s going to make a huge difference within the black community, and it’s something I haven’t seen in my 12 years in community development or real estate finance.