Not for the first time, demand for CDFI program funding in 2022 well exceeded the amount allocated by Congress.
The Treasury Department had good news and bad news for the Community Development Financial Institutions (CDFI) program on Tuesday.
The good news: the program is growing in popularity, with 719 organizations applying for the CDFI program and the Native American CDFI Assistance (NACA) program. That’s the largest number ever to apply for a single round of grants.
The bad news: Those organizations requested a total of $577.9 million in FY22 awards—nearly three times the amount of money available this year.
In FY22, Congress provided $214.5 million for the CDFI and Native American programs. This year, the Biden Administration has requested $331 million for the CDFI program—an amount that has been endorsed by the Credit Union National Association.
“This historic level of demand underscores the critical need for capital and credit in distressed and underserved communities across the country,” CDFI Fund Director Jodie Harris said, in announcing the application demand for the FY22 round.
Harris added that 40% of the CDFI certified financial institutions applied for either Financial Assistance (FA) or Technical Assistance (TA) funding this year.
Breaking Down the Numbers
Treasury Department officials further revealed the following of this year’s round:
–429 organizations requested $380.9 million in CDFI Program Base-Financial Assistance awards.
–242 organizations requested $30.1 million in CDFI Program Technical Assistance awards.
–222 organizations requested $65.9 million in CDFI Program Persistent Poverty County (PPC)-Financial Assistance awards.
–29 organizations requested $25.5 million in NACA Program Base-FA awards.
–19 organizations requested $2.7 million in NACA Program TA awards.
–15 organizations requested $4.2 million in NACA Program PPC-FA awards.
–19 organizations requested $9.5 million in Disability Funds-Financial Assistance awards.
–15 organizations requested $59 million in Healthy Food Financing Initiative-Financial Assistance awards.
A Recurring Pattern
CDFI requests regularly have outpaced the amount of money Congress has appropriated.
In FY21, 674 organizations requested a total of $565.3 million in funding for the CDFI and Native American CDFI programs. That was nearly three times the amount available.
In FY20, 588 organizations requested a total of $535.4 million, while Congress set aside $199.5 million for the programs.
The Trump Administration proposed eliminating the CDFI program, contending it had achieved its goal and that private capital was now available.
However, Congress has supported the program, with House Financial Services Appropriations Subcommittee Chairman Rep. Mike Quigley, D-Ill., saying in 2019 that House Republicans, as well as Democrats had submitted CDFI funding requests to his subcommittee.
To learn more about how your credit union can access CDFI program funding and awards grants, visit our CDFI Certification page or schedule a free consultation for further information.