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Expert Advice for a Successful Treasury CDFI Fund Grant Application

By Sam Brownell - October 13, 2021

CU Strategic Planning: Low-income simply means working class

Simplifying the Grant Application Process

Winning grants from Treasury's Community Development Financial Institutions Fund is far more than a simple application.

Jamie Strayer, founder of CU Strategic Planning, explained that successful grant writing is really a business plan, which is why her team includes former credit union executives and other experts that work on each application.CU Strategic Planning Jamie Strayer

The easy part for nearly all credit unions is qualifying for CDFI certification. Credit unions must:

  • Have a primary mission of promoting community development
  • Provide both financial and educational services
  • Serve and maintain accountability to one or more defined target markets
  • Maintain accountability to a defined market
  • Be a legal, non-governmental entity at the time of application (with the exception of Tribal governmental entities.

 “Fortunately, all credit unions meet most of these requirements. Low-income-​designated credit unions generally meet all of them, so it’s often a matter of the proper documentation,” Strayer said.

To demonstrate qualification, credit unions must also conduct a loan analysis, mapping and other documentation to show the applicant primarily serves one or more Treasury-designated target markets. A target market is a historically distressed investment area, a low-income population, or other targeted population (OTP). OTPs are vulnerable or underserved populations that have historically been denied credit or lack adequate access to capital.

To apply, your credit union must:

  • Demonstrate that the organization is accountable to its designated target markets through the make-up of its board of directors or an advisory board
  • Demonstrate that the applicant is a financing entity, which credit unions are
  • Document the development services that the organization provides in conjunction with its financing activities, such as technical assistance or training activities that prepare borrowers to access the institution’s financial products

CDFI certification is maintained annually with an annual report or the CDFI certification process must be repeated.

Strayer acknowledged, “The language ‘low income’ carries a lot of baggage when in all reality, the government definition is actually the working-class people credit unions were chartered to serve. This includes school teachers, city and county government workers, and all enlisted men and women, which are America's heroes.”CUCollaborate Low-Income Designation Guide

Download CUCollaborate’s ‘6 Untapped Benefits of Low-Income Designation’ guide today!

For example, credit unions serving hospitals are easily certified, but many of those credit unions wouldn’t have thought of themselves as serving the low-income. Strayer continued, “So, they don't have a second-chance checking account. We don't just say you should do that. We provide counsel to the credit unions’ executive team on design, policies to consider and operations processes.”

One huge, overarching piece of advice Strayer offered is: “Plan for the win from the very beginning. The easiest route may not necessarily be the best route, and that can create compliance challenges for when they win the grant.

“We've seen it with certifications that when we write a grant the credit union was previously certified, we have to look at the certification and make changes to it, because it wasn't actually what they needed or wanted.”

With grants, you have to be careful that what you’re applying best suits the needs of your credit union and members. Strayer explained, for example, if you apply for a grant for small business loans, they’re traditionally around $50,000. But if want to serve low-income people, then they don’t have the business to support that size loan; they want microloans, and those loans wouldn’t match the grant, so it would be out of compliance and wouldn’t qualify.”

CDFI Certification LogoCU Strategic Planning credit union clients have received more than $100 million in CDFI grant funds over the last decade and achieved a 100% success rate in CDFI certifications.

“And the exciting part is that the grant money can be used for everything that's needed,” Strayer said. “If a credit union thinks it is fairly mainstream and is serving for example, city or county workers or hospital workers, and desires to expand its field of membership it can also leverage CDFI grant funding.

“I really think that [CUCollaborate founder] Sam [Brownell] has a brilliant mind, and I’m very excited about the technology that he’s brought to the table.”

To learn more about CUCollaborate’s field of membership consulting and tools, click here!


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