Program aims to attract investment in underserved and economically distressed communities.
The Treasury Department's CDFI Fund on Wednesday announced it is now accepting applications for the FY23 round of Capital Magnet Fund awards.
Those awards—which will total $320.6 million—will be made to certified CDFI and non-profit housing organizations, and may be used to finance affordable housing, as well as other economic development and community service facilities. The objective, fund representatives said, is to attract capital investment in metropolitan, rural and economically distressed communities.
This year, applicants may apply for grants as part of a consortium, which officials said may assist smaller CDFIs and affordable housing developers.
The award round was announced even as the majority of the fund’s activities remain shut down while the Treasury Department contemplates changes to the program. The fund is expected to begin accepting all applications again on April 3.
How Is the Capital Magnet Program Funded?
The program’s funding comes from Fannie Mae and Freddie Mac and varies from year to year. The CDFI Fund did not conduct an application round in 2022 due to the timeline associated with operating the program, as well as the significant number of awards made in 2021, according to officials.
Funding from allocations received from Fannie Mae and Freddie Mac in FY22 will be used in the FY23 round. To ensure more consistency, the amount of funding available this year was determined by using a two-year average of Freddie and Fannie’s allocations.
Program Regulations and How to Apply
Grant recipients are required to leverage private and public funds, by a minimum ratio of 10:1, to finance affordable housing and economic development activities.
Starting with this round, the magnet fund will accept an expanded definition of High Opportunity Area for areas that may not meet the FHFA criteria, provided they present at least three of the following:
–High quality youth activities;
–Financial services opportunities.
Complete program details are available at the CDFI Fund website. There are varying deadlines for submitting financial information, while the grant application itself is due by March 21.
In addition, five live webinars will be hosted via Zoom to share further information and answer questions about the application. The webinar schedule is likewise available at the CDFI Fund website.