Neighborhood Assistance Projects also known as Community Service Tax Credit programs are available to develop projects in distressed areas across the country. They are funded by tax credit programs to encourage local businesses to invest in projects which improve impoverished neighborhoods. They typically include uses such as Neighborhood Assistance, Neighborhood Partnerships, Special Program Priorities and Charitable Food Programs. Law enforcement organizations may benefit from participation through the Special Program Priorities which includes a crime prevention component. This component is focused activities which reduce crime, community watch programs, crime awareness training, community crime prevention and targeted crime prevention programs such a seniors and youth. The goal of these programs is to promote community participation and collaboration among the residents, and business while producing outcomes by assisting a distressed area or low income population in a neighborhood. Each state has its own defined parameters of a distressed neighborhood and low income which may be found by a simple search on every state website.
Each of the fifty states has similar programs but it is critical that you contact your state agency which manages this program for the details, rules and guidelines for participation. Most states department community and economic development house this tax credit program as they work with both business and community nonprofits to build resources in distressed areas. These programs are funded through business tax credits. To receive funding you must be an eligible nonprofit community organization serving within a distressed community. The program guidelines provide applications which walk both the business and the nonprofit through the eligibility determination process. The process begins with a discussion between the nonprofit and the business to agree on a project and a contribution amount. Caps on amount of the tax credit % are defined by each state.
This funding works by allowing business to donate funding in lieu of paying taxes. The state tax credit typically allows the business allocate up to 50% of their allowable state taxes to the nonprofit community to help with community aid and development. Each state has its own percentages, eligibility rules and application process. Depending on the state contributions may include: cash contribution, equipment and/or supplies contribution, job training, real estate contribution or technical assistance. Each state has its own guidelines.
Nonprofit (501 (c) 3 IRS determination is required. They must document that they provide neighborhood assistance in an impoverished area or provide neighborhood assistance for low- and moderate income families. This includes Community Development Corporations or Community Based Development Organizations. Crime prevention programs provided within the eligible community are permitted as fundable projects.
The tax credit is available to any business paying income tax and whose contribution is made to an approved nonprofit.
Most applications require a complete case statement for funding. That means the nonprofit, law enforcement agency and business need to complete the case statement by working together to develop a strong fundable project. Examples of applications may be reviewed at the following sites:
Pennsylvania: http://newpa.com/find-and-apply-for-funding/funding-and-program-finder/nap2013
Kansas http://www.kansascommerce.com/index.aspx?NID=117
Delaware http://www.destatehousing.com/OtherPrograms/ot_naa.php
Missouri: http://ded.mo.gov/BCS%20Programs/BCSProgramDetails.aspx?BCSProgramID=85
These programs have been around within the nonprofit community since the early 1990’s. Your local community development corporation or chamber of commerce should be able to help direct you to your state program.
