The Credit Union National Association (CUNA) and 68 Community Development Financial Institutions are urging Congress to fully support the U.S. Treasury’s Community Development Financial Institution (CDFI) fund in the Fiscal Year 2018 budget.
In a letter to lawmakers, they are asking Congress to appropriate the same amount as FY 2017, which is $248 million. The CDFI Fund was zeroed out in a proposed budget from the Trump Administration. The appropriations bill passed by the House last week funds the CDFI Fund at $190 million, an amount still at pre-recession levels.
“CDFIs such as Community Development Credit Unions are charged with supplying low-income, distressed communities with traditional banking services such as savings accounts and personal loans, and offering individuals the tools needed to become self-sufficient stakeholders in their own future,” the letter read. “The CDFI Fund uses small amounts of federal dollars to leverage significant amounts of private and non-federal dollars, and has added a tremendous boost to the CDFI industry.”
The letter highlights two examples of CDFI credit unions leveraging funds to make an impact in their communities. One is the Appalachian Community Federal Credit Union, Johnson City, Tennessee, which used a $2.1 million CDFI grant to provide $10,500 down payments for over 200 families in its community to become first-time home buyers.
Another is the St. Louis Community Credit Union, St. Louis, Missouri, which leveraged a $849,000 grant into $22.7 million in auto loans through a program to provide affordable car loans to low- and moderate-income individuals and families so they can have access to reliable transportation to get to and from work.
“These examples represent just two credit unions and how the CDFI Fund is being used to grow local economies and serve the most economically distressed communities in the nation,” the letter read. “Fully funding the CDFI Fund at $248 million is a good investment by the federal government. Good paying jobs lead to more tax revenue and less dependence on the federal social safety net.”