After years of navigating complex federal economic development subsidies, Spokane is finally leveraging New Markets Tax Credits. With $35.5 million already invested and $5 billion in federal tax credits now up for grabs, leaders and developers should be ready to maintain this momentum.

We hope they are.

For years, accessing New Market Tax Credits posed a challenge for midsized communities across the country due to legal requirements and national competition, so smaller metropolitan areas often struggled to secure allocations. For more than a decade, the Spokane region remained on the sidelines while billions in federal economic development dollars passed it by.

Between 2011 and 2025, Spokane County closed zero New Market Tax Credit deals, walking away from an estimated $50 million to $100 million in direct federal subsidies and several times that in total capital investment. This occurred even though 42 of Spokane’s 74 census tracts qualified for the federal incentive, which delivers below-market, highly flexible, and partially forgivable financing for projects in distressed urban and rural communities.

That pattern appears to have finally broken. Notably, nonprofit community lender Craft3 recently finalized $35.5 million in New Market Tax Credit investments across Eastern Washington. The investments include $15 million for the Salish School of Spokane to construct a new cultural facility, language school, and community center along the Spokane River, and $20.5 million for the Kalispel Tribe of Indians to expand the Camas Medical Center and Dental Clinic.

We're in the midst of a coordinated regional push thanks to efforts spearheaded by Steve MacDonald, city of Spokane community and economic development director. Now, more organizations are positioning themselves for a share of an upcoming $5 billion federal tax-credit allocation round from the U.S. Treasury.

The project pipeline here includes:

• Maddie’s Place: A planned $15 million campus expansion for its neonatal transitional facility to scale clinical capacity and long-term family support.
• Frontier Behavioral Health & CHAS: A joint clinic at 130 E. Sprague integrating primary medical care with behavioral health treatment under one roof.
• Northeast Public Development Authority: A $12.5 million workforce housing development in Hillyard, at 3011 E. Wellesley, featuring 30 residential units and a ground-floor childcare center.
• West Plains Industrial: An upcoming industrial facility projected to bring 60 new jobs to the area.

The momentum couldn't come at a better time as federal policy changes have expanded funding opportunities for future projects. Under the One Big Beautiful Bill Act of 2025, Congress made the New Market Tax Credits a permanent part of the tax code, removing decades of legislative uncertainty. The move also signals to private investors that capital for community projects will be available with some predictability.

To lock in this momentum, business leaders, healthcare providers, educational institutions, and public entities should be asking one fundamental question during the planning process for upcoming developments: "Does this project qualify for New Markets Tax Credits?"

Spokane has the eligible tracts and the pipeline of projects. After 14 years of leaving federal money on the table, let's acknowledge that Spokane is finally in the game and is playing to win.