The New Markets Tax Credit (NMTC) Program provides essential financing tools for economic development projects across North Dakota’s diverse communities. From Fargo’s growing urban center to the oil-producing Bakken region, from tribal lands throughout the state to agricultural communities in the Red River Valley, NMTC financing enables transformative investments in areas where traditional capital markets fall short. CBO Financial works with North Dakota developers, energy sector companies, agricultural enterprises, healthcare providers, and tribal organizations to structure financing solutions that strengthen the Peace Garden State’s economy while addressing unique challenges, including geographic isolation, extreme weather impacts, economic volatility in energy-dependent regions, and infrastructure needs on tribal lands.
North Dakota’s resource-based economy—characterized by agriculture, energy production, advanced manufacturing, healthcare, tourism, and technology—creates significant opportunities for strategic NMTC deployment. The program offers a 39% federal tax credit to investors who provide capital to qualified projects in low-income communities, substantially reducing borrowing costs and making economically vital projects financially feasible. Whether you’re expanding value-added agricultural processing capacity, developing healthcare facilities in frontier counties, creating workforce housing infrastructure in the Bakken region, or building economic development projects on tribal lands, NMTC financing can provide the capital advantage that transforms your project from concept to reality.
How the NMTC Program Works in North Dakota
The NMTC Program functions through certified Community Development Entities (CDEs) authorized by the U.S. Treasury’s CDFI Fund to make Qualified Low-Income Community Investments (QLICIs) throughout North Dakota. These investments must occur in census tracts where the poverty rate exceeds 20% or the median family income falls below 80% of the area median. Investors providing equity to CDEs receive tax credits totaling 39% over seven years—5% annually for the first three years and 6% annually for the remaining four years.
North Dakota’s eligible census tracts span urban areas, rural communities, and tribal lands. Fargo, the state’s largest city, contains qualifying tracts despite the region’s overall economic strength. Grand Forks, Bismarck, and Minot include eligible areas experiencing various economic pressures. Rural North Dakota—particularly counties in the north-central region and along the Canadian border—presents extensive NMTC opportunities due to agricultural consolidation, population decline, and limited economic diversification. The western Bakken region contains eligible tracts despite oil industry activity, reflecting the boom-and-bust cycle’s impact on community stability.
Tribal lands represent particularly significant NMTC opportunities in North Dakota. The state’s five tribal nations—Spirit Lake Nation, Standing Rock Sioux Tribe, Turtle Mountain Band of Chippewa Indians, MHA Nation (Mandan, Hidatsa, and Arikara), and Sisseton-Wahpeton Oyate—encompass substantial territory where conventional capital access remains severely constrained and unemployment rates significantly exceed state averages.
The program supports sectors fundamental to North Dakota’s economic priorities: agricultural processing and value-added facilities, energy sector support infrastructure, advanced manufacturing operations, healthcare and behavioral health facilities, renewable energy projects, tourism and cultural heritage facilities, technology and innovation spaces, and community facilities serving rural and tribal populations. CBO Financial connects North Dakota projects with regional and national CDEs, navigating compliance requirements while ensuring projects meet NMTC financing standards and advance state economic development goals.
Eligible Projects and Borrowers
North Dakota projects eligible for NMTC financing address critical infrastructure and economic development needs across multiple sectors. Agricultural processing and value-added facilities represent a natural fit given North Dakota’s position as a leading agricultural state. Grain processing facilities, oilseed crushing operations, meat processing plants, dairy product manufacturing, specialty food production, and farm-to-market infrastructure all qualify when serving low-income communities and creating accessible employment opportunities.
Healthcare infrastructure projects remain a high priority given North Dakota’s challenge of maintaining healthcare access across its vast, sparsely populated geography. Critical access hospital improvements, rural health clinics, specialty care facilities, behavioral health treatment centers, dental clinics, and telehealth infrastructure qualify when serving underserved populations. The state’s ongoing challenges with substance abuse, mental health access, and provider shortages make healthcare facilities particularly compelling NMTC candidates.
Energy sector support infrastructure—while subject to careful structuring given NMTC restrictions on specific extractive industries—can qualify when projects serve broader community needs. Equipment manufacturing facilities, logistics and supply chain infrastructure, workforce training centers, and diversification projects helping energy-dependent communities transition to more stable economic bases all represent potential NMTC opportunities.
Advanced manufacturing facilities producing agricultural equipment, precision components, or other goods qualify when demonstrating job creation in low-income communities. Renewable energy projects, particularly wind energy component manufacturing or solar installations serving community facilities, align with North Dakota’s abundant renewable energy resources. Food distribution facilities addressing food security challenges in remote rural areas and on tribal lands qualify for NMTC support.
Technology and innovation spaces—including business incubators, coworking facilities, and research centers—qualify when supporting economic diversification in communities dependent on cyclical industries. Educational facilities such as tribal schools, early childhood education centers, STEM learning facilities, and workforce training centers address academic needs and qualify for financing.
Community facilities, including recreation centers, libraries, cultural centers preserving Native American and immigrant heritage, and mixed-use developments providing essential services in small towns, qualify for NMTC support. Downtown revitalization projects in North Dakota’s smaller cities—Grand Forks, Minot, Dickinson, Williston, Jamestown—leverage NMTC to restore aging infrastructure and create modern commercial spaces.
Eligible borrowers include for-profit businesses, nonprofit organizations, tribal entities and enterprises, and local government authorities. Tribal projects require specialized structuring given unique jurisdictional and legal considerations on reservation lands. CBO Financial creates comprehensive capital packages through CDFI financing that combine NMTC with conventional debt, equity, tribal lending programs, state incentives, USDA financing for agricultural and rural projects, and other complementary sources tailored to North Dakota’s development landscape.
Benefits of the NMTC Program for North Dakota
The NMTC Program delivers tangible economic benefits to North Dakota communities while providing borrowers with advantageous financing structures. The 39% tax credit substantially reduces effective capital costs, often enabling projects to achieve debt service coverage ratios acceptable to lenders while maintaining operational viability. For capital-intensive projects common in North Dakota—agricultural processing facilities, healthcare campuses, and manufacturing plants—this cost reduction frequently determines whether projects proceed or remain unrealized.
Beyond financial mechanics, NMTC investments generate significant community impact. Job creation and retention constitute primary program objectives, with projects committing to creating positions accessible to low-income individuals. In North Dakota’s rural areas and on tribal lands, where employment alternatives are minimal and population retention remains a critical challenge, job creation carries substantial importance for community sustainability.
North Dakota’s smaller communities particularly benefit from NMTC’s ability to finance projects that serve essential community needs despite limited profitability potential. A grocery store in a rural town, a healthcare clinic in a frontier county, or a manufacturing facility in a community transitioning from oil dependency can become feasible through NMTC’s cost reduction. These projects, while modest in scale compared to urban markets, represent transformative investments in communities where few alternatives exist.
The state’s tribal nations benefit substantially from NMTC’s improved capital access. Projects on tribal lands have utilized NMTC financing for healthcare facilities, cultural tourism enterprises, agricultural ventures, and commercial developments. These investments build wealth and economic infrastructure in communities facing systemic barriers to conventional capital markets, supporting tribal sovereignty and economic self-determination.
NMTC projects also catalyze significant private investment—each allocation dollar typically attracts multiple additional capital dollars, multiplying the program’s economic effect. This leverage proves especially important in North Dakota’s capital-scarce environment, particularly for projects in remote locations or on tribal lands where conventional lenders perceive elevated risk.
The program provides patient capital with flexible repayment terms. Unlike conventional loans requiring immediate full debt service, NMTC structures often feature interest-only periods during initial years, allowing projects to stabilize operations before principal payments commence. This flexibility proves especially valuable for projects in North Dakota’s cyclical economy or those with extended development timelines. To evaluate your North Dakota project’s NMTC potential, request your free project analysis with CBO Financial’s experienced team.
Regulatory & State Development Framework
North Dakota’s economic development ecosystem supports NMTC deployment through various state-level programs and agencies. The North Dakota Department of Commerce administers incentive programs that complement NMTC financing, including the Flex PACE program, Workforce Recruitment Grants, Innovation Technology Loan Fund, and various industry-specific initiatives. Understanding how to layer these state resources with federal NMTC benefits can significantly enhance project economics.
The Bank of North Dakota, the nation’s only state-owned bank, provides unique financing tools, including the Beginning Farmer program, PACE program loans, and various business development lending products that can work alongside NMTC financing. This institution’s mission-driven approach often aligns well with NMTC’s community development objectives.
For agricultural projects, North Dakota’s robust agricultural support infrastructure—including programs through the Department of Agriculture, North Dakota State University Extension, and commodity organizations—can provide complementary resources. USDA programs administered through North Dakota’s state office, including Business & Industry Loan Guarantees, Rural Energy for America Program, and Value-Added Producer Grants, often complement NMTC structures for agricultural and rural projects.
For tribal projects, entities including the Indian Affairs Commission facilitate coordination between tribal governments, state agencies, and federal programs. The Great Plains Tribal Chairmen’s Association and individual tribal economic development offices work to advance economic development on reservation lands. CBO Financial brings specialized experience in structuring NMTC transactions for tribal enterprises, navigating Bureau of Indian Affairs requirements, tribal employment rights ordinances, and trust land lending considerations.
Regional economic development organizations, including the Greater Fargo Moorhead Economic Development Corporation, Grand Forks Region Economic Development Corporation, and various county and municipal development entities, provide project support and help identify available local incentives.
Our team ensures projects meet both federal NMTC compliance requirements and North Dakota’s regulatory framework. We coordinate timing between NMTC closing schedules, state incentive applications, tribal government approvals for reservation projects, environmental reviews, and local approval processes. This integrated approach prevents delays and ensures all financing components align properly. North Dakota’s business-friendly regulatory environment and pragmatic approach to economic development make it an attractive location for NMTC projects.
Get Started with NMTC Financing in North Dakota
If you’re developing a project in a North Dakota low-income community—whether on tribal lands, in frontier rural counties, in the Bakken region, or in urban areas like Fargo or Grand Forks—NMTC financing deserves serious consideration. The program’s capacity to reduce capital costs while directing investment to underserved areas makes it uniquely powerful for addressing North Dakota’s development challenges, particularly maintaining economic viability in rural areas, supporting tribal economic development, and managing boom-and-bust cycles in energy-dependent regions.
CBO Financial’s process begins with a comprehensive project evaluation: verifying census tract eligibility, analyzing community impact potential, assessing NMTC suitability relative to other financing options, including Bank of North Dakota programs, and identifying optimal CDE partners. We then construct customized capital stacks that may combine NMTC with conventional debt, Bank of North Dakota financing, equity investments, state incentives, tribal lending programs for reservation projects, and USDA programs for agricultural and rural initiatives.
North Dakota clients benefit from our established relationships with CDEs, tax credit investors, and lenders active in rural and agricultural markets. We understand North Dakota’s unique development context—the farm economy’s importance, the energy sector’s volatility, the challenges of extreme weather and geographic isolation, the opportunities on tribal lands, and the specialized considerations for projects in frontier counties. This North Dakota-specific expertise streamlines the NMTC process and increases allocation success rates.
Project size shouldn’t deter NMTC exploration. While North Dakota’s smaller population means projects are often more modest than in larger states, transactions ranging from $2 million to $30 million regularly close using creative structuring approaches tailored to the state’s markets. The key is early engagement with experienced advisors who understand both NMTC mechanics and North Dakota’s specific development landscape. Connect with new markets tax credit consultant services professionals at CBO Financial today to discover how NMTC can make your North Dakota community development project a reality.