Members of Congress Champion CDFIs as COVID Relief Talks Stall

Jennifer A. Vasiloff

OFN is very disappointed that COVID relief negotiations between Congressional leaders and the Trump Administration have broken down, especially as the health and economic impacts of the pandemic continue to disproportionately affect low-income communities and communities of color.

Since March, the CDFI industry has advocated for the inclusion of at least $1 billion in emergency CDFI Fund grants in whatever legislation Congress and the President approve. Regrettably, without new legislation, this valuable source of capital remains out of reach for CDFIs, their customers, and the low-wealth communities where CDFIs operate.

The failure of COVID relief negotiations is particularly frustrating when you consider how many Members of Congress have recognized the valuable role of CDFIs by introducing ambitious legislation:

  • Senator Mark Warner (D-VA) and 13 bipartisan cosponsors have introduced The Jobs and Neighborhood Investment Act. This bill would redirect $17.9 billion previously approved in the CARES Act to create a new capital program for CDFIs and Minority Depository Institutions (MDIs) and a Federal Lending Facility for CDFIs, and it would dedicate new grant dollars for the CDFI Fund to disburse.
  • Senator Bob Menendez (D-NJ) has a bill with 11 cosponsors embracing the CDFI industry’s recommendation to appropriate $1 billion in immediate CDFI Fund grants.
  • Senator Brian Schatz (D-HI) and 10 cosponsors have introduced legislation to create a new $2 billion Crisis Fund that would automatically provide capital to CDFIs during a natural disaster or economic crisis.
  • Chair of the House Financial Services Committee, Maxine Waters (D-CA), and Representative Gregory Meeks (D-NY) have introduced Promoting and Advancing Communities of Color through Inclusive Lending Act. This initiative would expand resources for CDFIs, particularly those that are owned or led by minorities, and MDIs.

OFN is grateful to all these Congressional champions of CDFIs. We look forward to working with them to advance these CDFI initiatives, particularly those that address the CDFI industry’s immediate need for emergency grant dollars.

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