CDE Advisory Services

Managing your NMTC risks

The regulatory, compliance, and investor reporting requirements of NMTC investments are unique and often fall outside of an organization’s core business activities. But for New Markets Support Company (NMSC), it is our core business.

NMSC manages the Local Initiatives Support Corporation’s (LISC) $908 million NMTC investment authority, one of the largest in the country. Over the last decade, we have built an extensive risk management infrastructure, attracted a seasoned staff of asset management, accounting, and legal professionals, and developed sound processes and IT systems focused specifically on managing NMTC risks. We leverage our expertise to provide affordable third-party advisory services that help other allocatees effectively manage their portfolios.

We work one-on-one with our clients to tailor our services to their needs. We offer the following:


Ideal for allocatees that have internal accounting and reporting staff but lack NMTC experience, or those that want a “second pair of eyes” in the compliance aspect of the NMTC program.

• Provide pre-closing consulting to ensure compliance and monitoring issues are vetted and addressed in NMTC closing documents.

• Compute, test, and document compliance with substantially all requirements and monitor CDE distributions to document compliance with the NMTC Code requirements. Provide periodic sub-CDE compliance reports to allocatees.

• Provide oversight to ensure continued CDE status and allocation agreement compliance.

• Manage all aspects of data collection, analysis, and submission of Transaction Level Reports (TLR) and Institutional Level Reports (ILR) to satisfy CDFI Fund reporting requirements.

Accounting, Loan Servicing and Cash Management

Ideal for allocatees that would like to outsource the accounting, reporting, and servicing aspects of their NMTC investments.

• Prepare and maintain GAAP and tax-basis books and records for sub-CDEs and investment funds. Prepare quarterly and annual financial statements. Manage and oversee the annual audit and tax return process.

• Manage billing and collection of debt service and fees as required per loan documents; direct and manage transfer of funds between NMTC entities; perform collateral agent duties as necessary.

Asset Management

Ideal for allocatees that would like to outsource the construction and operational oversight of real estate investments.

• Actively manage projects under construction, including pre-closing construction budget and closing draw reviews, detailed post-closing construction draw reviews, and progress summaries.

• Oversee operating projects by collecting and reviewing quarterly and annual financial statements from QALICBs, having quarterly discussions with borrowers, and providing progress summaries.

• Perform project site visits as necessary.

• Prepare quarterly reports assessing the financial position and financial stability of each project and detail issues identified by NMSC.

Exit Services

Ideal for allocatees who have upcoming project exits and would like to leverage our staff's expertise to unwind their own investments. Since 2011, we have successfully exited from 35 NMTC investments, each with its own unique set of challenges.

• Communicate and coordinate with partners, including scheduling and leading exit meetings and calls.

• Negotiate and finalize reporting requirements, fees, and expenses with investors and QALICBs.

• Negotiate, review, and execute legal documents. We also offer affordable and experienced legal representation.

• Identify refinancing sources on behalf of your borrower.

• Collect and review a final community impact analysis.

NMTC Software

Ideal for allocatees with experienced staff, processes, and oversight but with a need for an effective software system to help manage their portfolios.

Our state-of-the-art software, New Markets Data Link (NewDL), was designed from the ground up by NMTC CDE practitioners to provide the tools necessary to effectively manage your NMTC allocation. By leasing NewDL, you can save time, reduce risks and gain quick access to all aspects of your NMTC investments. More specifically, NewDL works for you to:

• Capture all QEI, QLICI, and QALICB data on a secure, web-based platform so comprehensive NMTC data is available to your team from anywhere.

• Streamline management of Community Impact Information System (CIIS) data. NewDL provides integrity testing of data and offers direct uploading of CIIS data to the CDFI Fund.

• Protect your data with password-only access to reports, financial statements, tax returns and any other documents or information you need managed. Share access to documents and data with internal team members, investors and other third parties through a secure external web portal. Automatically notify investors when required reporting is available for access through the portal.

• Track loan status and automate invoicing to borrowers to facilitate loan servicing.

• Enhance asset management by tracking borrowers’ construction progress, analyzing operating performance, tracking reporting compliance, sending reporting reminders to borrowers and more.

• Customize reports by user to track your portfolio’s community impact, construction progress, operating performance, loan status, QLICI rates and terms, allocation status, investment concentration, substantially all requirements and much more.

Compliance Process Reviews and Training

Ideal for allocatees with experienced staff, processes, and oversight that would like an independent third-party review of their policies, procedures, and processes or would like supplemental training to increase staff’s understanding of the NMTC program.

• Documentation and assessment of your organization’s NMTC allocation lifecycle from deal intake through the 7 year compliance period.

• Provide process improvement recommendations

• Custom tailored staff training covering NMTC rules, regulations and industry best practices

To learn more about NMSC’s Advisory Services:

• Contact Steve Petsos at 312-697-6444 or

Download the CDE Services overview.