Advocates Call for Increased CDFI Funding
CUNA was among the groups pushing for greater investment in the CDFI program even as House Republicans were aiming to limit spending. Learn why.
CUNA among groups pushing for greater investment in program as House Republicans aim to limit spending.
Amid House Republican calls to roll back federal spending to its FY22 level, supporters of the Treasury Department’s CDFI Fund are calling for increased funding for the program.
“CDFIs will put these resources to work by providing financial services to underserved markets, including low-income rural and urban communities and communities of color,” the CDFI Coalition wrote in an appropriations request.
The coalition has called for Congress to provide $341 million for the CDFI program and an additional $10 million in credit subsidies for the Bond Guarantee program.
In his FY24 budget request to Congress, President Biden likewise requested $341 million for the CDFI program.
Supporting Letter From Senator
The coalition also released a copy of a letter being circulated by Sen. Bob Menendez, D-N.J. In the letter, addressed to leaders of the Senate Financial Services Appropriations Subcommittee, Menendez called for “at least” the $341 million included in the Biden budget for the program.
“As the economy recovers, small businesses and entrepreneurs in disadvantaged communities will need the patient, flexible capital available through CDFIs,” the letter states. “With CDFIs’ demonstrated success, a robust appropriation would provide much needed means and services to consumers and small businesses, especially in rural and urban low-income communities.”
CUNA Calls for Even More Funding
In addition, CUNA President/CEO Jim Nussle sent a letter to House appropriators this week calling on Congress to provide $500 million for the CDFI program in FY24.
In his letter, Nussle also pushed for $6 million for the NCUA’s Community Development Revolving Loan Fund program. The Biden budget calls for $4 million for the CDRLF program.
What Happens Next?
The requests for increased funding for the programs come as House Republicans contemplate developing a budget plan that would roll back federal funding on most programs to their FY22 level. That year, the CDFI program received $295 million.
Democrats have seized on that plan to argue that it would decimate many federal programs.
“Reductions to Treasury’s programs would also mean significantly fewer resources for Community Development Financial Institutions grants and assistance, thus harming the economic vitality of America’s most economically disadvantaged communities by reducing small business lending, affordable housing, and the provision of consumer products and services,” Treasury Secretary Janet Yellen wrote in a letter to House Appropriations Committee ranking Democrat Rosa DeLauro of Connecticut.
DeLauro had asked Biden cabinet secretaries to outline the impact the House Republican proposal would have on programs in their agencies.
Even if House Republicans are able to push a budget resolution calling for such a spending rollback, there is no chance that the Senate, controlled by the Democrats, would accept it.