PILLAR: Growing
AGENDA DATE: June 24, 2026
COUNCIL DISTRICT(S): 6
DEPARTMENT: Office of Economic Development
PRIORITY: Targeted Economic Growth
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SUBJECT
Title
Authorize a New Markets Tax Credit (NMTC) transaction between the Dallas Development Fund (DDF), a Dallas-based Texas non-profit corporation and certified Community Development Entity or a subsidiary thereof DDF, The Salvation Army of North Texas and affiliated entities (The Salvation Army), and Capital One and its subsidiaries thereof (Capital One), including up to $8 million of DDF’s $55 million NMTC allocation, in support of the Salvation Army Campus Project located at 8625 North Stemmons Freeway, Dallas, Texas 75247 (Project), a qualified project under Section 45D of the Internal Revenue Code of 1986, as amended, as further described in Attachment A, and for DDF to collect related closing costs and annual fees related to the Project - Financing: No cost consideration to the City
*In alignment with Economic Development Incentive Policy.
Body
BACKGROUND
On February 11, 2009, the City Council authorized the creation of the DDF, a Texas nonprofit corporation and certified Community Development Entity (CDE), and submission of a NMTC allocation application to the U.S. Department of Treasury’s Community Development Financial Institutions Fund (CDFI), by Resolution No. 09-0461. DDF was most recently awarded $55 million in NMTC allocation during the CDFI’s 2024-2025 allocation cycle. Previously, DDF has been awarded a total of $240 million in allocation from 2009, 2012, 2014, 2017 and 2021 cycles. To date, DDF has closed 25 NMTC transactions involving $229 million in allocation.
Under DDF’s bylaws, in addition to DDF Board approval, any DDF activity involving the use, transfer or allocation of NMTC must also be approved by the City through a City Council resolution indicating the allocation amount ($8 million) and beneficiary of the NMTC subsidy (The Salvation Army of North Texas).
The NMTC program permits taxpayers to receive a federal income tax credit for making qualified equity investments in designated CDEs. These investments must be used by the CDE for qualified projects and investments in low-income communities, as defined by the NMTC program regulations. The investor’s tax credit totals 39 percent of the investment and is claimed over a 7-year credit allowance period.
On May 15, 2026, the DDF Board of Directors reviewed and discussed prioritization of projects submitted through DDF’s Call for Projects for NMTC. The Board approved up to $8 million in NMTC allocation to support The Salvation Army Social Service Campus Project located at 8625 North Stemmons Freeway, Dallas, Texas as a NMTC transaction in accordance with the terms and conditions in the applicable term sheet(s), including authorization for DDF officers to negotiate and execute any document necessary to complete the transaction.
Additionally, Capital One Community Renewal Fund, LLC (“COCRF”) is anticipated to provide up to $6 million in Federal NMTC Allocation for the Project. Capital One, as the NMTC investor, will provide a total of approximately $4.4 million in NMTC Equity ($0.80 pricing) to support the $8 million in allocation from DDF and $6 million in allocation from COCRF.
The Salvation Army of North Texas is developing a new approximately 21-acre social service campus to centralize services, co-locate partner agencies, and significantly expand capacity to serve the City of Dallas’ homeless population. The Project includes an emergency shelter and victim services facility, supportive living housing, a social services center, and a wellness center that together will provide emergency shelter, supportive housing, healthcare access, workforce training, childcare, food access, and wraparound supportive services.
The Project includes approximately 46,700 square feet of emergency shelter and victim services space with 66 units housing approximately 255 beds for homeless men, women, and families, including dedicated shelter space for victims of domestic violence and sex trafficking. The supportive living building will include approximately 115,000 square feet with 134 units housing approximately 297 beds for individuals and families requiring additional support and transitional housing services for up to one year.
The social services center will include approximately 56,300 square feet dedicated to client intake, community partner office space, medical, dental, and mental health clinics operated by onsite partners, a client-choice food pantry, classrooms for workforce and life skills training, volunteer space, and Salvation Army administrative offices. The wellness center will include approximately 37,700 square feet with a commercial kitchen, dining facilities, culinary training space, recreation and fitness areas, pet kennel facilities, overflow shelter space, and a food distribution warehouse supporting local Salvation Army food pantries.
The Project will serve more than 5,000 low-income individuals annually through a comprehensive co-located service delivery model that includes emergency shelter, supportive housing, case management, healthcare, childcare, workforce development, legal services, and food assistance. Onsite partners are anticipated to include Parkland Health, Metrocare Services, Family Gateway, Vogel Alcove, Legal Aid of NorthWest Texas, and Integrated Psychotherapeutic Services Recovery. The campus will also be accessible through Dallas Area Rapid Transit bus service, with a bus stop located at the entrance to the campus, in addition to shuttle transportation services provided by The Salvation Army.
The Project site is located at 8625 North Stemmons Freeway in Dallas, Texas 75247. The Project falls within Census Tract 48113010003, which is NMTC-qualified and considered highly distressed per the CDFI Fund based on a poverty rate of 23.6 percent and its location within a Mental Health Professional Shortage Area, Major Disaster Declaration area, and United States Department of Agriculture-designated Low-Income, Low-Access area.
The Project will provide substantial community benefits including emergency shelter, supportive housing, healthcare access, workforce training, childcare services, legal assistance, and increased access to healthy foods. Workforce development programming will include culinary training and ServSafe certification opportunities, job readiness services, and forklift training and certification. Vogel Alcove is expected to provide trauma-informed childcare and family support services for approximately 168 children annually.
The Project is also anticipated to support approximately 219 full-time equivalent jobs. Employees will have access to benefits including health insurance, tuition reimbursement, retirement benefits, and paid time off. Approximately 77 percent of positions are anticipated to be accessible without a four-year degree, and The Salvation Army will partner with Workforce Solutions of Greater Dallas and other community organizations to recruit local residents.
NMTC financing is a critical component of the Project’s capital stack. The Project is part of The Salvation Army’s broader approximately $212.7 million One Army Many Fronts capital campaign and is primarily funded through philanthropic support. However, significant cost escalation associated with inflation in labor and construction materials has created a financing gap that NMTC financing will help address. NMTC assistance will support delivery of the Project as designed and help avoid reductions in scope or delays in implementation.
Additional Project information can be found in Attachment A to the Resolution.
PRIOR ACTION/REVIEW (COUNCIL, BOARDS, COMMISSIONS)
On February 11, 2009, the City Council authorized the creation of the Dallas Development Fund, a non-profit Community Development Entity by Resolution No. 09-0461.
On January 13, 2010, the City Council authorized the acceptance of the initial $55 million NMTC allocation by Resolution No. 10-0210.
The Economic Development Committee was briefed on the New Market Tax Credit Program on January 19, 2010.
The Economic Development Committee was briefed on the Dallas Development Fund/New Markets Tax Credit Program Update on September 21, 2015.
On May 15, 2026, the DDF Board of Directors was briefed on The Salvation Army Social Service Campus Project and approved the NMTC transaction.
The Economic Development Committee was briefed by memorandum regarding this matter on June 1, 2026. <https://cityofdallas.legistar.com/View.ashx?M=F&ID=15509185&GUID=660EEA12-EF5F-4F49-92B3-828839267CD5>
FISCAL INFORMATION
No cost consideration to the City.
OWNER/EXECUTIVE
The Salvation Army of North Texas
Christina Cavalier, Managing Director
MAP
Attached