Sen. Pat Toomey (R-PA) has requested the Government Accountability Office (GAO) examine Community Development Financial Institution (CDFI) funding initiatives.
Officials indicated the request revolves around a recent Banking, Housing and Urban Affairs Subcommittee on Financial Institutions and Consumer Protection hearing exploring the role CDFIs and Minority Depository Institutions (MDIs) play in supporting communities.
“Given the unprecedented amounts of taxpayer resources Congress directed to Treasury, CDFIs, and MDIs for pandemic response, it is vital policymakers know how effective these programs have been in helping to revitalize distressed areas and fill any gaps in access to credit for small businesses, as the program was originally intended to do,” Toomey wrote in the GAO request to Comptroller General of the United States Gene L. Dodaro.
Toomey said Congress provided $12 billion in taxpayer dollars to benefit CDFIs and Minority Depository Institutions (MDIs) last year, which represented over 40 times the size of any prior annual appropriation to the CDFI Fund.
Toomey has requested the GAO review how the Department of the Treasury allocated the funding, how the funding was used, and define the mechanisms in place to evaluate funding effectiveness.
The slated hearing witnesses were Carver Financial Corporation President and Chairman of the National Bankers Association CEO Robert James II; JetStream Federal Credit Union President and CEO Jeanne Kucey, on behalf of the National Association of Federally-Insured Credit Unions; and Heritage Foundation Research Fellow, Financial Regulations Joel Griffith.