Press Releases

WASHINGTON – U.S. Sens. Mark R. Warner and Tim Kaine (both D-VA) announced their co-sponsorship of the Downpayment Toward Equity Act, legislation to address the growing concern around rising home prices, lack of access to home-buying assistance, and the widening wealth and homeownership gaps in Virginia and throughout the country. The bill would provide federal grants, administered through local entities, to aid first-generation homebuyers with qualifying expenses toward purchasing their first home—including downpayment costs, closing costs, and costs to reduce the rates of interest.

“Homeownership is one of the most powerful pathways to accumulate wealth, but first-generation homebuyers – predominantly people of color – still face steep obstacles to achieving it and punching their ticket to the middle class,” said Sen. Warner. “The Downpayment Toward Equity Act could serve as a powerful tool to level the playing field, close the racial wealth gap, and help more families achieve their American Dream.”   

“I was a fair housing attorney in Richmond for nearly two decades, and I saw up close the impact that years of discriminatory housing policies had on families’ ability to purchase a home and benefit from the wealth building that comes from homeownership,” said Sen. Kaine. “While we’ve made significant progress in combating discriminatory policies since then, their lasting effects continue to be evident in the wide homeownership and wealth gaps that people of color face. The Downpayment Toward Equity Act would take a substantial step in addressing these gaps, by helping first-generation homebuyers overcome the disadvantages they face when trying to purchase a home.”

The Downpayment Toward Equity Act would administer grants of up to $20,000 to qualified first-generation homebuyers through the U.S. Department of Housing and Urban Development (HUD). Additionally, HUD would have the ability to increase these grants for socially and economically disadvantaged homebuyers. States would receive 75% of the funds each year, distributed by population, median home prices, and racial disparities in homeownership, and the remaining 25% would be competitively awarded to CDFIs, MDIs, and other nonprofit, mission-driven entities that target services to minority and low-income populations.

Led by Sens. Rev. Raphael Warnock (D-GA) and Laphonza Butler (D-CA), the bill is also currently co-sponsored by Sens. Sherrod Brown (D-OH), Alex Padilla (D-CA), and Chris Van Hollen (D-MD). Accompanying legislation was introduced in the U.S. House of Representatives by Financial Services Committee Chairwoman Maxine Waters and has received enthusiastic support from housing, homeownership, and racial equity organizations across the country, including the National Coalition for the Homeless, National Consumer Law Center, Housing Opportunities Made Equal of Virginia, Inc., Piedmont Housing Alliance in Charlottesville, VA, Habitat for Humanity International, Local Initiatives Support Corp., Mortgage Bankers Association, National Housing Conference, National NeighborWorks Association, National Fair Housing Alliance, National Association of Realtors, National Council of State Housing Agencies, National Coalition for the Homeless, National Consumer Law Center, and others.

Sens. Warner and Kaine are longtime supporters of initiatives to assist first-generation homebuyers. The senators introduced the Low-Income First Time Homebuyers (LIFT) Act to establish a program to help first-time, first-generation homebuyers – predominantly Americans of color – build wealth much more rapidly. The LIFT Act will establish a program at HUD, in consultation with the Department of the Treasury, to sponsor low fixed-rate 20-year mortgages for first-time, first-generation homebuyers who have incomes equal to or less than 120 percent of their area median income to increase access to homeownership for millions of families.

Text of the Downpayment Toward Equity Act is available here

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WASHINGTON – Today, U.S. Sen. Mark R. Warner (D-VA), joined by Sens. Roger Wicker (R-MS), Chris Van Hollen (D-MD), Cindy Hyde-Smith (R-MS), Gary Peters (D-MI), and Jerry Moran (R-KS), reintroduced bipartisan legislation to promote lasting economic prosperity in low-income, minority, and rural communities. The Community Development Investment Tax Credit would help unlock more equity and long-term financial capital for community development financial institutions (CDFIs). CDFIs often serve as a backbone for underserved communities including small and disadvantaged businesses, which tend to have fewer banking relationships and less access to credit.

“As someone who worked in the business world long before I ever joined politics, I know well that talent and ambition are not confined by income bracket or zip code. Unfortunately, access to start-up capital often is. CDFIs do the invaluable work of bridging the gap and reaching small businesses in our most vulnerable communities, and we have seen historic investments on this front over the past few years,” said Sen. Warner. “Despite this progress, CDFIs remain in need of additional equity and capital to continue serving their communities. This legislation will create a new tax credit, helping spur important private-sector investments and allowing these community lenders to grow.”

“Our country was built by small business, but many in low-income areas have trouble accessing the financing they need to launch and grow their businesses,” said Sen. Wicker. “CDFI investments play a pivotal role in bridging these gaps. The proposed tax credit in this legislation would help address the challenges faced by small business owners and provide an alternative to predatory loans.”

This bill will help direct support to lenders that focus on underserved communities by creating a CDFI Tax Credit for private sector investors that make equity, equity-equivalent investments, or long-term patient capital available to CDFIs. The bill would benefit CDFIs of all types including banks, credit unions, venture capital CDFIs, and loan funds, while providing institutions with the maximum flexibility and financial support they need to increase wealth in low- and moderate-income communities.

Sen. Warner has been a leader in Congress for CDFIs and Minority Depository Institutions (MDIs). To combat hemorrhaging jobs and loss of economic opportunities during the COVID-19 pandemic, Sen. Warner teamed up with then-Sen. Kamala Harris (D-CA), Sen. Cory Booker (D-NJ), and a bipartisan group of colleagues to introduce the Jobs and Neighborhood Investment Act – an effort that secured endorsements from a host of other advocacy organizations and civil rights groups. In 2022, Sen. Warner, joined by Sen. Mike Crapo (R-ID), launched the Senate Community Development Finance Caucus (CDFC), a bipartisan caucus dedicated to supporting the missions of CDFIs and MDIs by scaling their ability to lend in underserved communities.

Bill text is available here.

“We thank Senator Warner, Senator Wicker and the other bipartisan co-sponsors of the CDFI Tax Bill, which we strongly support,” said Rob Nichols, President and CEO, American Bankers Association. “ABA is proud to represent a number of CDFIs across the country and this legislation would expand investment in these critically important financial institutions, allowing them to have an even bigger impact in the communities they serve.”

“OFN applauds Senator Warner’s and Senator Wicker’s ?continued leadership in supporting community development financial institutions (CDFIs). The Community Development Investment Tax Credit Act will help drive more private capital to CDFIs offering affordable, responsible financing to low-wealth urban, rural, and Native communities across the country. We look forward to continuing to work with Senators Warner and Wicker to expand the tools available to CDFIs to finance economic justice and opportunity across the country,” said Harold Pettigrew, President and CEO, Opportunity Finance Network.

“The Community Development Investment Tax Credit Act of 2023 will spur significant private investment in Community Development Financial Institutions (CDFIs), increasing the availability of critically-needed long-term capital that will expand CDFIs’ capacity to develop and deploy affordable, responsible loans designed to meet the needs of the communities they serve. This expanded private investment will help CDFI intermediaries, like Inclusiv, support the growth of high-impact CDFI credit unions, allowing them to expand their lending to advance affordable homeownership, grow micro and small businesses, ensure low- and moderate-income homeowners can access energy efficiency and climate resilience home improvements, and more. We are grateful for Senator Warner’s deep commitment to the CDFI movement’s growth and impact,” said Cathie Mahon, President and EO, Inclusiv.

“The CDFI Investment Tax Credit is a smart and strategic tool. The credit uses a very small amount of public resources to leverage a multiple of private dollars and generate enormous community impact,” said Jeannine Jacokes, CEO, Community Development Bankers Association.

“The Independent Community Bankers of America appreciates Senator Warner’s leadership of the CDFI Caucus, and his work with Sen. Wicker on the CDFI Tax Credit Act, which will help spur equity investment in CDFIs, facilitate de-novo formation, and extend credit to underserved communities,” said Rebeca Romero Rainey, President and CEO, Independent Community Bankers of America.

“The Local Initiatives Support Corporation (LISC) applauds Senators Warner and Wicker for introducing the Community Development Investment Tax Credit Act of 2023.  Community Development Financial Institutions (CDFIs) have time and time again proven their ability to leverage public and private capital to support investments in some of the most underserved communities in the country.  This tax credit, by incentivizing long term investments in CDFIs, will allow CDFIs to in turn provide longer term, lower cost loans to finance affordable housing, small businesses, homeownership and essential community facilities in their neighborhoods,” said Matt Josephs, Senior Vice President for Policy, Local Initiatives Support Corporation.

“The CDFI Tax Credit will provide a powerful tool for community development venture capital funds to raise private investment capital to help us reach scale, bringing good jobs and business development to low-income communities across that nation,” said Kerwin Tesdell, President, Community Development Venture Capital Alliance. “The legislation also includes important fixes to the definition of CDFI that will correct technical issues that have long caused community development venture capital funds to be underrepresented among certified CDFIs.”

“The CDFI Coalition is pleased to add its voice in strong support for the legislation sponsored by Sens. Warner and Wicker to establish a tax credit for Community Development Financial Institutions (CDFIs). CDFIs provide financial products and services in urban neighborhoods and rural areas underserved by traditional financial institutions, particularly those communities with high rates of poverty and unemployment. Throughout the last economic downturn, CDFIs served as economic shock absorbers, providing flexible and patient capital, rigorous risk management, and commitment to the projects in their communities and the sustainability of their borrowers. While traditional lenders fled economically distressed communities, CDFIs stepped in to fill the void. Since the advent of the economic crisis prompted by the pandemic, CDFIs have been on the frontlines of providing financial and technical assistance to small and minority-owned businesses. CDFIs fill a vital niche in the nation's financial services delivery system by serving communities and market sectors that conventional lenders cannot - with the ultimate goal of bringing CDFI customers into the mainstream economy as bank customers, homeowners and/or entrepreneurs. The proposed CDFI Tax Credit will provide a new avenue for CDFIs to raise capital that will be deployed to finance small businesses, construct affordable housing, and support community facilities in disadvantaged communities across the country. CDFIs leverage over $12 in private capital to every $1 in federal support, so the resources authorized by the tax credit will extend far beyond the amount authorized and help CDFIs to fill the widening credit gap encountered by economically disadvantaged communities across the country,” said Ceyl Prinster, President and CEO, Colorado Enterprise Fund and Chair of the CDFI Coalition.

“Senators Warner and Wicker's innovative proposal to drive more resources into our communities is forward-thinking and much needed. CDFIs, whose missions are to create economic opportunity for all, have an unmatched ability to leverage private capital sources, like equity and patient debt, into community-centered initiatives. Unfortunately, the community need is outpacing the resources available to CDFIs therefore it is important to develop new ways to attract and sustain investment into our financial institutions. Additional investment options like the CDFI Tax Credit will be a game-changer for our industry across the country. The VA CDFI Coalition is excited by the possibilities these investments could create across Virginia and hope to see this pass,” said Leah Fremouw, Board President, VA CDFI Coalition. 

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CLICK HERE TO DOWNLOAD HIGH-QUALITY PHOTOS FROM THE EVENT

WASHINGTON – U.S. Sens. Mark Warner (D-VA) and Mike Crapo (R-ID), co-chairs of the Community Development Finance Caucus, along with Deputy Secretary of the Treasury Wally Adeyemo held an event today on Capitol Hill with corporate and banking leaders to announce that members of the Economic Opportunity Coalition have reached their goal of securing $1 billion in committed deposits in Community Development Financial Institutions (CDFIs) and Minority Depository Institutions (MDIs) in order to expand their lending power for underserved communities and small businesses emerging from the pandemic. 

The private sector funding will boost public efforts to strengthen and grow the lending capacity of CDFIs and MDIs, which included a record $12 billion federal investment to help underserved communities access affordable capital secured by Sens. Warner and Crapo as part of the bipartisan COVID relief package approved by Congress at the end of 2020. The additional deposits announced today will help to bring down loan-to-deposit ratios at these institutions, which will allow them to increase their lending further while ensuring they maintain adequate liquidity.

“Strengthening minority and community lenders will help unlock the economic potential of some of our most overlooked communities,” said Sen. Warner. “I’m glad to see the private sector working with us to leverage returns on public investment while investing in entrepreneurs and small businesses in communities of color and other financially underserved areas.”

“This exciting benchmark is just the beginning of support for underserved and rural communities across the country,” said Sen. Crapo.  “The private sector’s partnership in investing in these communities is crucial for the long-term sustainability and economic growth of areas most in need.”

“Our economy works best when capital is unlocked across races and regions,” said Deputy Secretary of the Treasury Wally Adeyemo. “Today’s announcement reflects the impact of a coordinated partnership between the public and private sectors to address economic inequality across the nation and maximize the impact of the Biden-Harris Administration’s unprecedented investments in underserved communities.”

“CDFIs and MDIs are proximate to communities. They exist to support small businesses, aspiring homeowners, community infrastructure needs, and the development of affordable housing,” said Michael Roth, Co-lead of the Economic Opportunity Coalition and Co-CEO of Next Street. “Moving deposits to these kinds of community-based lenders facilitates access to credit in communities where traditional financial services are limited, unavailable, or unaffordable. That’s why this EOC milestone is really also a call to action. We know 1 billion dollars isn’t enough; it's just the start.” said Roth.

Launched by Vice President Harris last July, the Economic Opportunity Coalition is a group of more than two dozen corporations and philanthropies that committed to making major investments in communities of color to address economic disparities and accelerate economic opportunity. Representatives of the Coalition at today’s event included leaders from Wells Fargo, Next Street, KeyBank, TIAA, Citi, and Bank of America. 

“Senators Warner and Crapo and Treasury Deputy Secretary Wally Adeyemo have been amazing champions of getting resources to CDFIs and MDIs that are serving communities of modest financial resources.  The Emergency Capital Investment Program (ECIP) was a true game-changer, providing equity investments that mission-based financial institutions could use to attract $8 of additional deposits and debt for every $1 of ECIP investment.  Hence, the $8+ billion of ECIP investments will over time create $100 billion of lending capital that can be recycled at least 3 times over a 10-year period,” said Martin Eakes, CEO, Self-Help Credit Union. “I know this sounds complicated, but the bottom line is that the actions of these leaders and their associates will produce more than 1 million new homeowners and tens of thousands of new businesses in communities of color, and in other rural and lower wealth communities all across the country.” 

“Black-owned Optus Bank has exponentially grown its balance sheet and, more importantly, its impact on high-potential underestimated communities,” said Dominik Mjartan, President and CEO of Optus Bank. “With transformational investments from the private sector, we have been able to leverage the recent ECIP investment to more than double the bank’s loan portfolio in 2022 while directing more than 90% of our loans to mission-aligned communities.”

“These commitments ensure that CDFIs and MDIs are equipped to significantly expand impact to working Americans who have historically struggled in the pursuit of economic prosperity,” said Darrin Williams, Southern Bancorp, Inc. CEO. “Combined with the ongoing support from Congress and Treasury, our industry has never before been as equipped to fulfill our mission of reaching the financially underserved – from rural America to our urban centers – we are building the capacity to finance the positive economic change needed in our country.”

“Public and private investments are essential to closing wealth gaps in America and enabling lasting financial health and resilience, including throughout retirement. As a founding member of the EOC, TIAA is proud to contribute to this critical funding milestone and to advance collective engagements that unlock resources for innovators, business owners and other leaders in underserved communities,” said W. Dave Dowrich, CFO at TIAA. “Supporting the holistic financial well-being of communities to help achieve longer-term equitable growth goes hand-in-hand with our efforts to ensure all Americans can retire with dignity and financial security. As too many Americans navigate economic challenges, these investments demonstrate that bipartisanship and cross-sector collaboration can deliver scalable and sustainable solutions that can meaningfully change lives and improve communities.”

“We are strong supporters of the Economic Opportunity Coalition and congratulate the organization on reaching the goal of $1 billion in deposits that will be placed with CDFIs and MDIs.  These organizations are a critical part of the lending ecosystem for underserved communities, and we look forward to helping them grow and better serve their local markets,” said Charlie Scharf, CEO of Wells Fargo.  

“Citi is able to use our robust balance sheet to provide access to capital for our MDI partners that have historically faced higher burdens for raising capital, enabling them to enhance their support for individuals and businesses in underserved communities,” said Citi CFO Mark Mason. “In addition to joining in the Economic Opportunity Coalition’s $1 billion announcement today, Citi and the Citi Foundation are deepening our efforts to support CDFIs and MDIs and we are eager to work with the EOC to expand the net even further to help solve the significant, unmet need.”

“KeyBank embraces the opportunity to partner with Community Development Financial Institutions (CDFIs) and Minority Depository Institutions (MDIs) through the Economic Opportunity Coalition,” said Chris Gorman, CEO and Chairman of KeyCorp. “At Key, our purpose is to help our clients and communities thrive. In partnership with CDFIs and MDIs, we are bringing that purpose to life by expanding banking services in our neighborhoods and bringing more capital-building tools to underserved communities. We appreciate the leadership of Senators Warner and Crapo, and the Treasury Department's commitment to an inclusive economy.”

“Promoting investment and economic opportunity in underserved communities is critical to reaching the U.S.’s potential to enable growth that is also inclusive. McKinsey & Company is proud to be a founding member of the Economic Opportunity Coalition, and will to continue working with our partners to support this critical goal,” said Bob Sternfels, McKinsey’s Global Managing Partner.

“Today’s one billion funding announcement reflects the Coalition’s commitment to taking meaningful actions to accelerate economic opportunity in underserved communities across the country,” said Nat Hoopes, Vice President and Head of Public Policy and Regulatory Affairs at Upstart. “Upstart is proud to contribute both dollars and our AI technology to support CDFIs and MDIs in their important work to expand access to affordable credit.”

“This milestone is a testament to the power of public private partnerships in accelerating economic opportunity,” said Dan Schulman, president and CEO, PayPal. “Continued investment in CDFIs and MDIs is critical to building thriving communities and creating transformative change. PayPal is proud to be a founding member of this effort and we look forward to the continued collaboration.”

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WASHINGTON?– Today, U.S. Sen. Mark R. Warner (D-VA) and Rep. Maxine Waters (D-CA) sent a letter to the Environmental Protection Agency (EPA) urging them to ensure that investments through the Greenhouse Gas Reduction Fund (GGRF), a key Inflation Reduction Act program, serve to strengthen diverse-owned financial institutions dedicated to climate financing in low-income communities and communities of color. Today’s letter comes as the EPA prepares to release the Notices of Funding Opportunity for the GGRF, a competitive grant program to boost clean energy and climate projects in low-income and disadvantaged communities.  

“We write to urge the Environmental Protection Agency (EPA), in its review of applications for funding from the Greenhouse Gas Reduction Fund (GGRF), to give priority to applicants whose proposals fully utilize the diversity of financial institutions engaged in climate finance, including green banks, community development financial institutions (CDFIs) and minority depository institutions (MDIs), as well as center their investment approach on low income and disadvantaged (LID) communities,” wrote the lawmakers in a letter to the EPA. “Specifically, CDFIs and MDIs leverage capital and have a proven track record of providing products and service to the most underserved communities. We urge EPA to heed the lessons learned from the Paycheck Protection Program regarding the importance of being intentional with program design when driving investments in low income and disadvantaged communities.”  

In the letter, the lawmakers stressed the need to award this federal funding so that it goes towards projects and communities that lack access to affordable capital. They also highlighted the importance of ensuring that grant recipients have the structure, diversity, and track record needed to meet the goals of the GGRF. 

“[T]he entities receiving direct federal investment must also demonstrate experience navigating green financing projects and have shown the ability to manage these projects across a variety of communities in order to achieve [Greenhouse Gas] GHG emissions reductions and develop successful projects. It is critical that the EPA balance out these needs for both financial viability and project-level expertise in order to maximize the fund’s performance across all metrics,” they continued. “Additionally, since the Justice40 prioritization should be a floor, not a ceiling, the EPA should require applicants to provide a strategy for how they will drive awareness, demand, and adoption of clean technologies in LID communities. We urge you to learn about community-level solutions that the Fund can support, especially solutions from low-income and disadvantaged communities.” 

Further, the lawmakers urged the EPA to make important adjustments and issue guidance in order to maximize the impact of the funding in vulnerable communities.  

“The success of the program in LID communities depends heavily on the ability to develop an ecosystem that supports other actors, including clean energy and workforce developers. Although the EPA guidance makes available $625,000 for technical assistance for indirect recipients, in order to drive demand and create an ecosystem we recommend that the EPA require some of these funds be aggregated and administered at the national level by the eligible recipient,” they wrote. “The Implementation Framework released by EPA caps the amount per indirect recipient at $5,000,000, which may not be the most impactful way to reach LID communities. For example, some communities have a limited number of mission driven lenders (e.g. CDFI deserts), making the cap on indirect investments have an impact on the amount of climate financing in those communities. We urge you to adjust this limitation on indirect investments to account for more factors, including demand, size of the institution and impact.” 

Among other measures, the lawmakers also suggested that the EPA review the deep impact standards created by the Department of the Treasury for the Emergency Capital Investment Program (ECIP) – a key initiative created as part of a Warner-championed $12 billion investment?to open up new credit opportunities for low-income communities and communities of color. 

Joining Sen. Warner and Rep. Waters in sending the letter are Sens. Raphael Warnock (D-GA), Tina Smith (D-MN), and Alex Padilla (D-CA), as well as Reps. Nydia M. Velázquez (D-NY), Gregory W. Meeks (D-NY), and Judy Chu (D-CA).  

Text of the letter is available here and below. ? 

Dear Administrator Regan:

We applaud the EPA in taking an important step forward by providing guidance through the Implementation Framework for the Greenhouse Gas Reduction Fund and express our continued support for the swift implementation of this critical program. We agree with the EPA’s principles that this program can reduce emissions of greenhouse gases and other air pollutants, deliver benefits of projects to American communities, particularly those in LID communities, and mobilize financing and private capital to stimulate additional deployment of GHG reducing projects.

We write to urge the Environmental Protection Agency (EPA), in its review of applications for funding from the Greenhouse Gas Reduction Fund (GGRF), to give priority to applicants whose proposals fully utilize the diversity of financial institutions engaged in climate finance, including green banks, community development financial institutions (CDFIs) and minority depository institutions (MDIs), as well as center their investment approach on low income and disadvantaged (LID) communities. It is important that EPA adhere to the meaning and intent of Congress in the text of the Inflation Reduction Act (Pub. L. 117-169) (IRA) which highlights a dual mission of reducing greenhouse gases, while impacting LID communities.

In order to meet the objectives and principles outlined in the Implementation Framework, we believe eligible recipients must include meaningful involvement of a variety of financial institutions and business models, including clean financing institutions, community based-financing institutions, and other institutions designed to support clean technology deployment. Specifically, CDFIs and MDIs leverage capital and have a proven track record of providing products and service to the most underserved communities. We urge EPA to heed the lessons learned from the Paycheck Protection Program regarding the importance of being intentional with program design when driving investments in low income and disadvantaged communities. As a result, we believe that an ideal applicant for GGRF funds should have a shared governance structure that is diverse and accountable to local communities, have a plan for continued operability that includes experience investing in or with a variety of mission driven financial institutions, a market transformation approach that effectively crowds-in private capital without displacing otherwise commercially viable investment activities, a strategy for driving demand in LID communities, and an approach that incentivizes a significant amount of investment in the most underserved of the LID communities.

A shared governance structure where decision-making authority is granted to a variety of financial institutions and implementation partners is critical to meeting the goals of the GGRF, particularly in the competition for the National Clean Investment Fund. Mission driven lenders have different business models and products, making it essential that the governing body of the eligible recipient reflect that diversity of expertise and approach. To maximize the program’s success, the governing body must include green banks, CDFIs, MDIs, and other mission driven lenders with experience in climate finance and investment in LID communities. The governing body must be appropriately empowered and go beyond advisory to ensure capital allocation decisions reflect the diversity of business models among indirect recipients and private capital providers. Additionally, the governing body should reflect the demographic diversity of our nation and demonstrate accountability to local communities. 

The IRA includes a “continued operability” requirement that ensures that direct investments be structured to ensure all communities continue to be served beyond the initial award of funds to an eligible recipient.  However, in the Implementation Framework released on April 19, 2023 the EPA decided to separate direct investment and indirect investments into two separate competitions. This policy decision likely eliminates the possibility of cross-subsidies that would ensure continued operability for indirect investments in LID communities, which typically need a deeper subsidy. If the EPA opts to continue with separate competitions, we believe the agency should give priority to applicants that are applying for or collaborating across both competitions, have a strong track record of leveraging private capital, and a demonstrated ability to diversify a portfolio that includes debt, equity and grants in a way that meets the needs of a variety of financial institutions. Without a strong track record, direct recipients will not be able to instill confidence in the capital markets and optimize leverage across the portfolio at the indirect recipient level as well as at the qualified project level. We urge you to continue working closely with the staff from the U.S. Department of the Treasury that have experience internally, and through their consultants, making these types of investments in mission driven lenders. This includes a $12 billion suite of capital and grant programs to support CDFIs, MDIs, and the communities they serve, as well as the renewed State Small Business Credit Initiative (SSBCI) that is supporting up to $100 billion in small business loans, investments, and technical assistance through various state, tribal, and territory government programs.  We urge you to collaborate with them to maximize the impact of GGRF for communities that need the support the most.

Similarly, the entities receiving direct federal investment must also demonstrate experience navigating green financing projects and have shown the ability to manage these projects across a variety of communities in order to achieve GHG emissions reductions and develop successful projects. It is critical that the EPA balance out these needs for both financial viability and project-level expertise in order to maximize the fund’s performance across all metrics. The EPA should seek to work with entities that are composed of both impact-oriented institutions as well as green financing entities, to ensure that the goals of impact, performance, GHG emissions reductions and long-term sustainability are achieved.

Furthermore, the impact of the GGRF should not be to crowd out private capital but instead to focus on those eligible projects and communities that lack access to affordable capital. Although the IRA states that eligible recipients should prioritize projects that lack access to financing, the EPA should be focused on market transformation. Displacing affordable private capital focused on the broad use and adoption of clean technologies would run counter to the country’s climate goals.

Additionally, since the Justice40 prioritization should be a floor, not a ceiling, the EPA should require applicants to provide a strategy for how they will drive awareness, demand, and adoption of clean technologies in LID communities. We urge you to learn about community-level solutions that the Fund can support, especially solutions from low-income and disadvantaged communities. In addition, CDFIs and MDIs have a long track record of serving communities long ignored by the traditional banking sector, including the development of financing and financial tools that meet the needs of low-income and disadvantaged communities. Simply put, reducing emissions and lowering energy costs among those communities will be best accomplished through the use of financing tools, grant support, and effective outreach to generate demand, change behavior, and build local capacity.  It’s important that applicants prioritize technologies that will transform LID communities – saving households money on energy costs, creating quality jobs, and improving air quality - and work within the existing debt burden of families in LID communities. However, these communities cannot be served with financing tools alone and will need significant grant support across the value chain to generate demand, change behavior, and build local capacity. The success of the program in LID communities depends heavily on the ability to develop an ecosystem that supports other actors, including clean energy and workforce developers. Although the EPA guidance makes available $625,000 for technical assistance for indirect recipients, in order to drive demand and create an ecosystem we recommend that the EPA require some of these funds be aggregated and administered at the national level by the eligible recipient.

Driving demand will also need to be accompanied by a meaningful level of investment in mission driven lenders in order to change behavior. The Implementation Framework released by EPA caps the amount per indirect recipient at $5,000,000, which may not be the most impactful way to reach LID communities. For example, some communities have a limited number of mission driven lenders (e.g. CDFI deserts), making the cap on indirect investments have an impact on the amount of climate financing in those communities. We urge you to adjust this limitation on indirect investments to account for more factors, including demand, size of the institution and impact.

Finally, we urge you, after defining low income and disadvantaged community, to encourage applicants to the GGRF to structure a significant number of their investments in a way that incentivizes investments in the most underserved low income and disadvantaged communities, including those affected by high rates of adverse health and environmental outcomes. Investments in some underserved communities, like areas of persistent poverty and majority-minority communities, often are more time consuming and costly than in some other communities that are also considered underserved. Also, the definition of LID should include people focused categories, like the CDFI definitions for Low Income Targeted Populations (LITP) and Other Targeted Populations (OTP), to make sure that the low income and minority people who live in the LID communities are also directly benefiting from the GGRF.  We urge you to look at the deep impact standards created by Treasury for the Emergency Capital Investment Program (ECIP) and encourage eligible recipients to make investments in mission driven lenders that include similar financial incentives for investments in the most underserved communities. 

We share a dedication to decarbonization and justice and hope that we can work together with you and our nation’s mission driven lenders to meet the goals of the GGRF.

Sincerely,

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WASHINGTON – Today, U.S. Sens. Mark R. Warner (D-VA) and Mike Crapo (R-ID), Co-Chairs of the Senate Community Development Finance Caucus, reintroduced the Scaling Community Lenders Act, bipartisan legislation to unlock more sources of liquidity and support for Community Development Financial Institutions (CDFIs). The legislation would allow CDFIs to scale their activities and fuel more lending in low- and moderate-income (LMI) communities.

CDFIs play a critical role in providing responsible and affordable credit to underserved communities. While Congress has taken significant steps to support community-based lenders since the onset of the COVID-19 pandemic, CDFIs continue to require more long-term patient capital, operating capital, and resources to modernize their systems and compete in an era of rapid financial innovation. The Scaling Community Lenders Act would authorize new resources to activate and fund the long-dormant Section 113 of the Riegle Act of 1994 – the CDFI liquidity enhancement program –allowing the CDFI Fund to finance projects within the industry, selected on a competitive basis, to provide liquidity to CDFIs.

“CDFIs can play a crucial role in driving economic growth and providing access to capital to underserved communities,” said Sen. Warner. “I’m pleased to reintroduce this legislation to that supports new and innovative approaches in the industry and lays the groundwork for new ways to meet the needs in LMI communities.”

“I am proud to support the Scaling Community Lenders Act, which will help provide access to capital in low-income, rural and underserved communities,” said Sen. Crapo. “CDFIs play an important role in our state and nationwide, and this bill will help them expand their lending activities.”

CDFIs lend across a variety of categories, including business loans, consumer loans, commercial real estate, residential real estate, home improvement, and home purchases. However, for many of these products there is no secondary market that can unlock capacity and take loans of CDFI balance sheets. The development of a secondary market or facility that would buy loans from CDFIs would allow the industry to prove the performance of their assets in the long-term. The Scaling Community Lenders Act would encourage innovation and help determine the best routes for unlocking secondary markets for CDFIs.

Sens. Warner and Crapo have long been supporters of CDFIs and MDIs. Last year, the senators launched the bipartisan Senate Community Development Finance Caucus to serve as a platform where policymakers can coordinate and expand on public and private-sector efforts in support of the missions of Community Development Financial Institutions (CDFIs) and Minority Depository Institutions (MDIs).

Bill text is available here.

“During the Paycheck Protection Program, CDFI loan funds – for the first time – gained access to a Federal Reserve liquidity facility which allowed CDFIs to expand their lending to the small businesses in low-wealth communities hit hard by the Covid crisis. Opportunity Finance Network welcomes the piloting of other models for enhancing liquidity as outlined in the Scaling Community Lenders Act. Senator Warner, once again, is leading on initiatives to support and scale the CDFI industry,” said Jennifer A. Vasiloff, Chief External Affairs Officer, Opportunity Finance Network.

“The CDFI industry has proven its ability to expand access to financial services responsibly for unbanked communities, rural communities, and communities of color over the last few decades. It is time to bring new liquidity tools to the market to enable community lenders to scale to meet the enormous need for affordable credit. Without these tools, millions of Americans will not have access to income and wealth generating activities like small business and home ownership that expand opportunity and reduce the racial and gender wealth gaps,” said Beth Bafford, Vice President for Strategy, Calvert Impact.

“CRF strongly endorses the Scaling Community Lenders Act of 2023 introduced by Senators Warner and Crapo. We applaud their leadership and foresight to develop liquidity resources for CDFIs. As a pioneer of community development secondary markets and securitization, we understand the importance and power of providing liquidity to CDFIs. We were early supporters of section 113 of the Riegle Act and are delighted to see this section of the bill come to life. We are confident that these critical resources will enable CDFIs to deliver more impact in underestimated communities,” said Matthew Roth, CEO, Community Reinvestment Fund, USA.

“CDBA strongly supports the Scaling Community Lenders Act. Access to liquidity is an important tool for community development lenders to manage their portfolios and balance sheets, which in, turn gives them more capacity to serve their communities. The SCL Act will help build CDFI industry infrastructure that will expand access to capital in low income and minority communities,” said Jeannine Jacokes, CDBA.

“CDFIs consistently demonstrate an ability to support and reach historically marginalized and under-resourced communities. These community-centered organizations, built to promote economic inclusion and capital access, need their own capital tools to scale and break through barriers to their growth,” said Leah Fremouw, Board President, VA CDFI Coalition. “Facilitating the development of a reliable secondary market for CDFIs will provide these lenders opportunities to leverage their existing portfolio as a financing tool, freeing up assets for additional community investment. Activating and capitalizing the dormant Section 113 of the Riegle Act is critical to building a secondary market for CDFI lending, ultimately giving them the liquidity to originate more high-impact loans and capital tools. The VA CDFI Coalition is excited by the possibilities these investments could create across Virginia and hope to see this pass.”

“CDFIs play a critical role in reaching business owners, families and communities that our capital markets have left behind. Our decades of work with CDFIs have clearly identified the challenges they face in accessing the capital they need to scale their lending. Building secondary markets for CDFI loans is an essential complement to the CDFI Fund’s direct support for these critical institutions.  We’re pleased to see this movement toward activating an important part of the original CDFI Fund statute,” said Joyce Klein, Director, Aspen Institute Business Ownership Initiative.

“The Local Initiatives Support Corporation (LISC) thanks Senators Warner and Crapo for introducing the Scaling Community Lenders Act,” said Matt Josephs, Senior Vice President for Policy, LISC. “Research has shown that Community Development Financial Institutions (CDFIs) loans are high performing, although in most cases they are nontraditional and do not meet the underwriting and collateralization standards required by conventional banks. As a result, there is not a vibrant secondary market where CDFIs can sell these loans to investors. This legislation will kickstart a CDFI secondary market so CDFIs have access to loan purchasers to obtain the capital needed to finance additional community and economic development activities for underserved people and communities.”

“CDFIs are always in need of new approaches to help deliver on the promise of increased scale. In the current interest rate environment, finding new ways to add liquidity is more important than ever. Supporting the Scaling Community Lenders Act is a critical step to leverage the CDFI Fund and drive innovation,” said Brett Simmons, Managing Director of the EBA Fund.

“The CDFI Coalition is pleased to add its voice in strong support for the legislation sponsored by Sens. Warner and Crapo to establish a pilot program aimed at establishing a secondary market for loans made by Community Development Financial Institutions (CDFIs). The Scaling Community Lenders Act of 2022 amends the Community Development Banking and Financial Institutions Act of 1994 to authorize $100 million for funding up to 6 pilot programs, selected on a competitive basis, which would purchase CDFI loans and loan participations, provide guarantees, loan loss reserves and lines of credit and other measure necessary to enhance CDFI liquidity. CDFIs emerged to provide financial services in urban neighborhoods and rural areas underserved by traditional financial institutions, particularly those with high rates of poverty and unemployment,” said Ceyl Prinster, President and CEO, Colorado Enterprise Fund and Chair of the CDFI Coalition. “By leveraging over $12 in private capital to every $1 in federal support, CDFIs are filling the widening credit gap encountered in many communities, creating jobs improving housing and community facilities and creating economic opportunity. Throughout the last economic downturn, CDFIs provided flexible and patient capital, rigorous risk management, and commitment to the projects in their communities and the sustainability of their borrowers. While traditional borrowers fled economically distressed communities, CDFIs stepped in and filled the void. Since the advent of the economic crisis prompted by the pandemic, CDFIs have been on the frontlines of providing technical and financial assistance to small and minority-owned businesses. CDFIs fill a vital niche in the nation's financial services delivery system by serving communities and market sectors that conventional lenders cannot - with the ultimate goal of bringing CDFI customers into the mainstream economy as bank customers, home owners and/or entrepreneurs. We believe that the Scaling Community Lenders Act will enhance the ability of CDFIs to support economic revitalization in economic distressed rural, urban, minority and tribal communities.  Establishing a secondary market for CDFI loans will be increase the availability of capital to CDFIs that will put it to good use in financing affordable housing, small businesses, and community facilities.”

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WASHINGTON – U.S. Sens. Mark R. Warner and Tim Kaine (both D-VA) joined a bipartisan, bicameral group of colleagues in introducing the Secure and Fair Enforcement (SAFE) Banking Act of 2023. The legislation would ensure that legal cannabis businesses have access to critical banking and financial services. 

Most state legal medicinal or recreational cannabis businesses across the country are denied access to traditional and secure banking systems and financial services because banks fear they may be prosecuted under federal law given the current federal restrictions on cannabis. Due to the lack of access to financial services, legal state cannabis businesses are forced to operate solely using cash, which leaves to door open to potential tax evasion and increases the potential for criminal activity.

“No business operating legally and safely should feel the need to conduct their business in all-cash out of fear of unfair penalization from the federal government,” said Sens. Warner and Kaine. “It is about time we pass the SAFE Banking Act and ensure that all legal cannabis businesses have access to the financial services they deserve to support their businesses and keep their communities safe.”

Specifically, the?SAFE Banking Act?of 2023 would prevent federal banking regulators from: 

  • Prohibiting, penalizing or discouraging a bank from providing financial services to a legitimate state-sanctioned and regulated cannabis business, or an associated business (such as a lawyer or landlord providing services to a legal cannabis business); 
  • Terminating or limiting a bank’s federal deposit insurance primarily because the bank is providing services to a state-sanctioned cannabis business or associated business; 
  • Recommending or incentivizing a bank to halt or downgrade providing any kind of banking services to these businesses; or 
  • Taking any action on a loan to an owner or operator of a cannabis-related business. 

This legislation would also create a safe harbor from criminal prosecution and liability and asset forfeiture for banks and their officers and employees who provide financial services to legitimate, state-sanctioned cannabis businesses, while maintaining banks’ right to choose not to offer those services. The bill also provides protections for hemp and hemp-derived cannabidiol (CBD) related businesses. 

This legislation also explicitly extends the safe harbor to Community Development Financial Institutions (CDFI) and Minority Depository Institutions (MDI) ensuring they can also serve cannabis businesses. Sens. Warner and Kaine have long been supporters of CDFIs and MDIs. Last year, Sen. Warner launched the bipartisan Senate Community Development Finance Caucus to serve as a platform where policymakers can coordinate and expand on public and private-sector efforts in support of the missions of Community Development Financial Institutions (CDFIs) and Minority Depository Institutions (MDIs). Extending the safe harbor to Community Development Financial Institutions (CDFI) and Minority Depository Institutions (MDI) ensures that underserved communities are not once again excluded from opportunities to access capital and financial support for their businesses.

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WASHINGTON — Today, U.S. Sens. Mark R. Warner and Tim Kaine (both D-VA) applauded $10,035,800 in federal funding to support 10 Virginia-based Community Development Financial Institutions (CDFIs) in their mission to expand lending and investment opportunities in disadvantaged neighborhoods and communities. The funding was awarded through the U.S. Department of the Treasury’s Community Development Financial Institutions Program (CDFI Program). The CDFI Program invests in and builds the capacity of CDFIs to serve low-income people and underserved communities lacking adequate access to affordable financial products and services.

“CDFIs are critically important financial institutions that help underserved communities across the Commonwealth and the country access capital,” the Senators said. “Early on in the pandemic, we fought for increased CDFI funding because we saw that initial relief efforts weren’t reaching underserved communities. We’re glad to see that funding flowing to communities across Virginia to help bridge that gap.”

The funding is distributed as follows:

  • $6,140,000 to Capital Impact Partners in Arlington, VA.
  • $797,900 to Freedom First Federal Credit Union in Roanoke, VA.
  • $660,000 to the ECDC Enterprise Development Group in Arlington, VA.
  • $560,000 to Arlington Community Federal Credit Union in Falls Church, VA.
  • $510,000 to the Southeast Rural Community Assistance Project, Inc. in Roanoke, VA.
  • $510,000  to Appalachian Community Capital Corporation in Christiansburg, VA.
  • $482,900 to RVA Financial Federal Credit Union in Richmond, VA.
  • $125,000 to Foodshed Capital in Charlottesville, VA.
  • $125,000 to Mobility Credit Acceptance, LLC in Richmond, VA.
  • $125,000 to Peoples Advantage Federal Credit Union in Petersburg, VA.

Sens. Warner and Kaine have long worked to ensure that underserved communities have better access to financial services. During the COVID-19 pandemic, Sens. Warner and Kaine secured funding for Community Development Financial Institutions (CDFIs) and Minority Depository Institutions (MDIs) in pandemic relief packages modeled after Sen. Warner’s Jobs and Neighborhood Investment Act. Last year, Sen. Warner launched the bipartisan Senate Community Development Finance Caucus to serve as a platform where policymakers can coordinate and expand on public and private-sector efforts in support of the missions of Community Development Financial Institutions (CDFIs) and Minority Depository Institutions (MDIs).

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WASHINGTON — U.S. Sens. Mark R. Warner (D-VA) and Mike Crapo (R-ID), co-chairs of the bipartisan Senate Community Development Finance Caucus (CDFC), released the following statement after the Treasury Department’s CDFI Fund announced that it would update its timeline for rolling out the new CDFI Certification Application and likely revise the version that was released for public comment in the Federal Register on November 4, 2022:

“We are pleased to see the CDFI Fund postpone the launch of the new CDFI Certification Application beyond the previously anticipated April timeline in order to carefully review and weigh all public comments. As we indicated in our letter to Treasury, it is critical that the CDFI Fund provide adequate time to receive and consider comments on the proposed changes to avoid unintended consequences and ensure that its programs reflect the perspectives, and meet the needs of the low-income, underserved and rural communities the Fund was created to serve.”

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WASHINGTON – Today, U.S. Sens. Mark R. Warner (D-VA) and Mike Crapo (R-ID), co-chairs of the bipartisan Senate Community Development Finance Caucus (CDFC), sent a letter to U.S. Department of Treasury Secretary Janet Yellen urging the department to consider all comments received in response to the Community Development Financial Institution (CDFI) application and Annual Certification and Data Collection Report (ACR).

“With the recent sizable investments in CDFIs, we support efforts by Treasury to ensure taxpayer dollars are reaching the intended recipients and used appropriately.  However, adequate time to receive and consider comments on the proposed changes is critical to avoid any unintended consequences and is central to ensuring that the CDFI Fund programs reflect the perspectives, and meet the needs, in the low-income, underserved and rural communities the Fund was created to serve,” the senators wrote in the letter.

Sens. Warner and Crapo conveyed concerns from stakeholders regarding the procedure through which the Department issued the new CDFI application and certification.

They continued, “Department of Treasury’s Stakeholders have expressed concern that the publishing of the new CDFI certification application and guidance by the Office of Management and Budget under the Paperwork Reduction Act (PRA) on November 4, 2022, may have been procedurally insufficient. Moreover, some within the CDFI community believe that industry input is not being considered. These concerns have caused stakeholders to request the CDFI application and ACR be published under the formal rulemaking process governed by the Administrative Procedures Act (APA).”  

In their letter, Sens. Warner and Crapo requested more information about why Treasury decided that the APA process was not appropriate in issuing new standards. They also requested information on how the CDFI Fund intends to review and consider comments submitted through the PRA process.

To combat the hemorrhaging of jobs and opportunities during the pandemic, Sen.  Warner secured a record $12 billion in funding for CDFIs and Minority Depository Institutions (MDIs) to help underserved communities access affordable capital, in legislation modeled after his Jobs and Neighborhood Investment Act. More recently, Sen. Warner secured $324 million in the 2023 government funding bill for the U.S. Department of the Treasury CDFI Fund.

Last year, Sens. Warner and Crapo launched the bipartisan Senate Community Development Finance Caucus to serve as a platform where policymakers can coordinate and expand on public and private-sector efforts in support of the missions of CDFIs and MDIs. 

A copy of the letter is available here and below.

Dear Secretary Yellen,

We write to encourage the U.S. Department of Treasury to consider all comments received in response to the Community Development Financial Institution (CDFI) application and Annual Certification and Data Collection Report (ACR) released on October 4, 2022.  The proposed changes by the CDFI Fund must preserve the ability of CDFIs to be creative and flexible with historically underserved borrowers. 

The CDFI Fund maintains broad, bipartisan support in the U.S. Senate and we note its importance in meeting the needs of underserved communities in our home states. Certified entities should be aligned with the purposes of the CDFI Fund’s authorizing statute. With the recent sizable investments in CDFIs, we support efforts by Treasury to ensure taxpayer dollars are reaching the intended recipients and used appropriately.  However, adequate time to receive and consider comments on the proposed changes is critical to avoid any unintended consequences and is central to ensuring that the CDFI Fund programs reflect the perspectives, and meet the needs, in the low-income, underserved and rural communities the Fund was created to serve. 

Stakeholders have expressed concern that the publishing of the new CDFI certification application and guidance by the Office of Management and Budget under the Paperwork Reduction Act (PRA) on November 4, 2022, may have been procedurally insufficient. Moreover, some within the CDFI community believe that industry input is not being considered. These concerns have caused stakeholders to request the CDFI application and ACR be published under the formal rulemaking process governed by the Administrative Procedures Act (APA). 

Can you share more information about why Treasury decided that the APA process was not appropriate? Additionally, how does the CDFI Fund intend to review and consider comments submitted during the PRA process?

We share a dedication to our communities and hope we can work together to expand on the great work done by CDFIs.  We look forward to your response. 

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 WASHINGTON – Today, U.S. Sens. Mark R. Warner and Tim Kaine (both D-VA) announced that $29,856 in federal funding will be awarded to three credit unions in Virginia. The funding, classified as Digital Service and Cybersecurity grants, will go towards strengthening the credit unions’ cybersecurity systems, acquiring technology that allows employees to work remotely, or implementing digital services for members like mobile or online banking. The grants, awarded through the National Credit Union Administration’s 2022 Community Development Revolving Loan Fund, are specifically designed to support low-income credit unions and underserved consumers.

“Credit unions help ensure all Virginians have access to the financial resources they need to save for their families, buy a home, or start a business,” the senators said. “This funding will directly support these organizations’ operations so that they can continue to reach out to underserved communities in the Commonwealth.” 

The funding is distributed as follows:

  • $10,000 for the Virginia Educators Credit Union in Newport News, VA.
  • $10,000 for RVA Financial in Richmond, VA.
  • $9,856 for the Richmond Heritage Federal Credit Union in Richmond, VA.

Sens. Warner and Kaine have long worked to ensure that underserved communities have better access to financial services. During the COVID-19 pandemic, Sens. Warner and Kaine secured funding for Community Development Financial Institutions (CDFIs) and Minority Depository Institutions (MDIs) in pandemic relief packages modeled after Sen. Warner’s Jobs and Neighborhood Investment Act.

Most recently, Sen. Warner launched the bipartisan Senate Community Development Finance Caucus to serve as a platform where policymakers can coordinate and expand on public and private-sector efforts in support of the missions of Community Development Financial Institutions (CDFIs) and Minority Depository Institutions (MDIs).

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WASHINGTON – Today, U.S. Sens. Mark R. Warner (D-VA) and Mike Crapo (R-ID) announced the creation of the Senate Community Development Finance Caucus (CDFC), a bipartisan caucus dedicated to supporting the missions of Community Development Financial Institutions (CDFIs) and Minority Depository Institutions (MDIs) to scale their activities and fuel more lending in low- and moderate-income (LMI) communities.

The 14-member caucus is bipartisan and evenly divided between Democrats and Republicans including Sens. Amy Klobuchar (D-MN), Mike Braun (R-IN), Jon Ossoff (D-GA), Steve Daines (R-MT), Jack Reed (D-RI), Cindy Hyde-Smith (R-MS), Tina Smith (D-MN), Cynthia Lummis (R-WY), Chris Van Hollen (D-MD), Jerry Moran (R-KS), Rev. Raphael Warnock (D-GA), and Mike Rounds (R-SD).

CDFIs play a critical role in providing responsible and affordable credit to underserved communities. During the pandemic, CDFIs demonstrated their ability to deliver billions of dollars to underserved businesses through the Paycheck Protection Program (PPP), totaling approximately $34 billion.

On a bipartisan basis, Sen. Warner worked with Sen. Crapo, former Treasury Secretary Steven Mnuchin, and other colleagues to introduce the Jobs and Neighborhood Investment Act, which passed as part of the December 2020 COVID relief package. The bill made a historic $12 billion investment in CDFIs and MDIs, which included $3 billion for grant funding and $9 billion for tier-one capital investments in CDFIs and MDIs, which could be leveraged 10 to 1.

“CDFIs and MDIs play an essential role in providing access to capital in underserved communities. While Congress took significant steps to support community-based lenders over the last two years on a bipartisan basis, CDFIs continue to need more long-term patient capital, operating capital, and resources to modernize their systems and compete in an era of rapid financial innovation. I am happy to announce the creation of this caucus with Sen. Crapo to improve communication between industry and policymakers and continue working in a bipartisan fashion towards robust investments in CDFIs and MDIs,” said Sen. Warner.

“I have consistently heard positive news and success stories about CDFIs in Idaho and across the country, and their responsiveness to the small business community, particularly during these last few challenging years of the pandemic,” said Sen. Crapo. “Sen. Warner and I are proud to launch this caucus to educate members and staff about the important role CDFIs play in their communities, and to create a forum to share ideas and policy proposals that foster strong economic growth in local communities.

A summary deck describing the caucus can be found here. More information on the caucus can be found on its webpage here.

The Community Development Finance Caucus has the support of a number of organizations and financial institutions.

“The National Bankers Association is proud to endorse the bipartisan U.S. Senate Community Development Finance Caucus, which will develop legislative efforts to support MDIs and CDFIs while providing direct lending opportunities. We commend Sen. Mark Warner for his leadership and commitment to ensuring MDIs have the resources to serve our nation's low- and moderate-income communities,” said Nicole Elam, President and CEO, National Bankers Association.

“The Community Development Bankers Association is excited about the formation of the Community Development Finance Caucus.  The CDFI sector has emerged as a critical component of the financial services sector because it works to ensure access by underserved markets.  Addressing growing income disparity, promoting racial equity, and building financial wellness are important national priorities and the need for the Caucus is great,” said Jeannine Jacokes, CEO of CDBA.

“Opportunity Finance Network (OFN) applauds the leadership of Sens. Mark Warner and Mike Crapo in launching the Community Development Finance Caucus. Providing affordable, mission-drive financing to underinvested communities is the special expertise that community development financial institutions (CDFIs) offer. The CDFI industry looks forward to working with the Community Development Finance Caucus on strengthening public sector understanding and support of CDFIs and the positive community development impact they have in low-wealth communities,” said Jennifer A. Vasiloff, Chief External Affairs Officer, Opportunity Finance Network.

“Inclusiv, the largest CDFI network representing near 500 community development credit unions providing responsible and sustainable financial products to over 18 million predominantly low income and minority consumers, expresses its strong support for the formalization of a congressional caucus that will be focusing on community development, financial inclusion and the economic revitalization of minority communities through CDFIs. This body will provide a platform to engage the CDFI industry and inform the development of public policy that’s both impactful and sustainable. We are grateful to Sens. Warner, Crapo, and all caucus members for spearheading this important initiative and call on other senators to lend their support,” said Cathie Mahon, President and CEO of Inclusiv.

“The African-American Credit Union Coalition (AACUC), is proud to partner and collaborate with INCLUSIV on ensuring that there is equitable financial futures for all people – especially the marginalized and underserved – usually the Colored Majority.  A Community Development Finance Caucus would provide the appropriate forum for ideas and strategies to be discussed and executed,” said Renée Sattiewhite, President and CEO of the African American Credit Union Coalition.

“On behalf of the National Association of Latino Credit Unions and Professionals, we applaud Sens. Warner, Crapo, and all caucus members for leading the organizing of a CDFI Caucus that will give lawmakers a platform to support the critical work of CDFIs play in low income and communities of color as financial first responders and engines of economic revitalization. Our organization is in full support of this initiative and asks members of the Senate to support it as well,” said Maria Martinez, Board Chair, National Association of Latino Credit Unions and Professionals.

“The Local Initiatives Support Corporation (LISC) thanks Sens. Warner and Crapo for forming a Community Development Finance Caucus. Community Development Financial Institutions (CDFIs) are the backbone of this sector, providing capital, credit, and financial services in distressed communities and to underserved individuals throughout the country. CDFIs serve borrowers and geographic areas that are not readily served by mainstream financial institutions, providing loans to first-time homebuyers, financing for affordable housing and community facilities, and small business financing. The CDFI sector has grown significantly over the last 20 years, and this growth would not have been possible without bipartisan congressional support. LISC applauds Sens. Warner and Crapo for forming a Community Development Finance Caucus, which will focus on how Congress can continue to meet the needs of CDFIs and their work to serve underserved people and places,” said Matt Josephs, Senior Vice President for Policy, LISC.

“We applaud Sens. Warner and Crapo for their strategic and coordinated approach to strengthening CDFIs and MDIs and helping them reach their full potential. We stand ready to work with the Community Development Finance Caucus to leverage public-private partnerships to promote access to capital in areas served by these critically important institutions,” said Rob Nichols, President and CEO, American Bankers Association.

“CDFIs with proven records of serving underbanked people and communities of color are vital to an inclusive economy.  The creation of the Caucus represents an important step in ensuring that America’s financial system works for everyone,” said Bill Bynum, Hope Credit Union CEO.

“The access to responsible, flexible capital that Community Development Financial Institutions provide has had a transformative impact in the Northern Rockies and across the country, helping those outside the financial mainstream gain self-sufficiency and improve the livelihoods of their families and communities. At MoFi, we’re greatly appreciative of efforts by Sens. Mark Warner, Mike Crapo, Steve Daines, Cynthia Lummis, and others to form the Community Development Finance Caucus. It will be an important bipartisan venue for sharing information, discussing legislation, and tracking programs as lawmakers work to remove barriers and promote access to capital for all underserved Americans,” said Dave Glaser, President of MoFi.

“The Independent Community Bankers of America (ICBA) applauds Sens. Warner and Crapo for organizing the Community Development Finance Caucus. There are currently 144 Minority Depository Institutions (MDIs) serving roughly 600 minority-majority communities nationwide. There are roughly 300 Community Development Financial Institution (CDFI) banks, primarily serving low-to-moderate income markets and maintaining accountability to those target markets. Their impact in the communities they serve is significant and must be leveraged for greater reach. ICBA looks forward to working with the Community Development Finance Caucus to further support our long-standing commitment to MDIs and CDFIs,” said Rebeca Romero Rainey, President and CEO of ICBA.

"I would like to applaud the hard work from Sens. Crapo and Warner toward the development of the Community Development Finance Caucus. We are excited at the opportunity to have a caucus dedicated to the work and efforts of the many CDFI practitioners working on the ground every day,” said Ted Piccolo, Executive Director Northwest Native Development Fund, former Chair Native CDFI Network.

“On behalf of the Native CDFI Network (NCN), NCN applauds the bipartisan effort of Sens. Crapo and Warner to establish a Community Development Finance Caucus within the United States Senate.  Community Development Finance Institutions (CDFIs) have proven to be an irreplaceable mechanism for channeling critically needed capital into low- and moderate-income communities. This is especially true in Indian Country, where Native communities have long experienced substantially higher rates of poverty and unemployment than mainstream America. They also face a unique set of challenges to economic growth, such as: poor/lacking physical, legal, and telecommunications infrastructure; limited access to affordable financial products and services for consumers, aspiring homeowners, and would-be entrepreneurs; and limited workforce development strategies to support Native people’s full participation in their local economies. NCN looks forward to the opportunity to have a Caucus that supports the work of CDFI’s,” said Pete Upton, Interim Executive Director, Native CDFI Network.

“The CDFI Coalition supports the establishment of a CDFI Caucus and applauds the leadership of Sens. Warner and Crapo in establishing this bipartisan Caucus and thanks Sens. Smith, Klobuchar, Lummis, Van Hollen, Daines, Ossoff, Braun, Reed, Hyde-Smith, Warnock, Moran, and Rounds for joining. The establishment of a CDFI Caucus will bring attention to the important role that CDFIs play in revitalization in disadvantaged rural and urban communities across the country and build support for bipartisan future bipartisan initiatives,” said Ceyl Prinster, President and CEO, Colorado Enterprise Fund, Chair, CDFI Coalition.

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WASHINGTON – This week, U.S. Sens. Mark R. Warner (D-VA) and Bill Hagerty (R-TN) introduced the Scaling Community Lenders Act of 2022, bipartisan legislation to unlock more sources of liquidity and support for Community Development Financial Institutions (CDFIs) to scale their activities and fuel more lending in low- and moderate-income (LMI) communities.

CDFIs play a critical role in providing responsible and affordable credit to underserved communities. During the pandemic, CDFIs demonstrated their ability to deliver billions in dollars to underserved businesses through the Paycheck Protection Program (PPP), at a large scale, to the tune of $34 billion. While Congress took significant steps to support community-based lenders over the last two years on a bipartisan basis, CDFIs continue to need more long-term patient capital, operating capital, and resources to modernize their systems to compete in an era of rapid financial innovation. The Scaling Community Lenders Act of 2022 authorizes new resources to activate and fund the long-dormant Section 113 of the Riegle Act of 1994 – the CDFI liquidity enhancement program – which would allow the CDFI Fund to fund demonstration projects within the industry, selected on a competitive basis, to provide liquidity to CDFIs.

“CDFIs and Minority Depository Institutions play an essential role in providing access to capital to underserved communities, which is why I’m so committed to supporting these institutions. I’m proud of the work I’ve been able to do with my colleagues across the aisle to secure historic investments in these community-based lenders, and to work with Sen. Hagerty on this innovative approach that supports new and innovative approaches in the industry and lays the groundwork for new ways to scale the industry’s ability to meet the needs in LMI communities,” said Sen. Warner. “There’s no silver bullet, and I’m for an all-the-above approach to support these vital community-based lenders. In my view, in addition to increasing the CDFI Fund’s resources we should make sure that CDFIs have every tool possible to do what they do best, which is supporting their communities and working to give everyone, regardless of zip code or background, a fair shot.”

“CDFIs can play a constructive role in driving economic growth in America,” said Sen. Hagerty. “I’m pleased to cosponsor this legislation with Senator Warner to establish a pilot program that will help provide a roadmap to leverage CDFI funding with private capital rather than Federal funds.”

CDFIs lend across a variety of categories or asset classes, including business loans, consumer loans, commercial real estate, residential real estate, home improvement, and home purchases. However, for many of these products there is no secondary market that can unlock capacity and take loans of CDFI balance sheets. The development of a secondary market or facility that could buy loans from CDFIs would allow the industry to build scale and prove the performance of their assets in the long-term. The Scaling Community Lenders Act of 2022 will encourage innovation and help determine the best routes for unlocking secondary markets for CDFIs.

Bill text is available here. A one-pager describing the bill is available here.

“CRF strongly endorses the Scaling Community Lenders Act of 2022 introduced by Senators Warner and Hagerty. We applaud their leadership and foresight to develop liquidity resources for CDFIs. As a pioneer of community development secondary markets and securitization, we understand the power of providing liquidity to CDFIs.  We were early supporters of section 113 of the Riegle Act and are gratified to see this section of the bill come to life,” said Frank Altman, Founder & CEO, Community Reinvestment Fund.

“CDFIs play a critical role in reaching business owners, families and communities that our capital markets have left behind. Our decades of work with CDFIs have clearly identified the challenges they face in accessing the capital they need to scale their lending. Building secondary markets for CDFI loans is an essential complement to the CDFI Fund’s direct support for these critical institutions.  We’re pleased to see this movement toward activating an important part of the original CDFI Fund statute,” said Joyce Klein, Director, Aspen Institute Business Ownership Initiative.

"New innovations to channel reliable liquidity to CDFIs are sorely needed. Supporting those efforts through activating and funding the CDFI Fund's liquidity enhancement program will pave the way for new scale in all parts of the CDFI industry, putting more capital where it does the most good." – said Brett Simmons, Managing Director of the EBA Fund.

“CDBA strongly supports efforts to build critical industry infrastructure that enable CDFIs and the communities they serve to thrive.  Access to liquidity is important to the functioning of financial institutions and this bill will help ensure that a diverse range of CDFIs have access.” – said Jeannine Jacokes, CEO of the Community Development Bankers Association.

“CDFIs consistently demonstrate an ability to support and reach historically marginalized and under-resourced communities. These community-centered organizations, built to promote economic inclusion and capital access, need their own capital tools to scale and break through barriers to their growth. Facilitating the development of a reliable secondary market for CDFIs will provide these lenders opportunities to leverage their existing portfolio as a financing tool, freeing up assets for additional community investment. Activating and capitalizing the dormant Section 113 of the Riegle Act is critical to building a secondary market for CDFI lending, ultimately giving them the liquidity to originate more high-impact loans and capital tools. The VA CDFI Coalition is excited by the possibilities these investments could create across Virginia and hope to see this pass,” said Leah Fremouw, Board President, VA CDFI Coalition.

“The Local Initiatives Support Corporation (LISC) thanks Senators Warner and Hagerty for introducing the Scaling Community Lenders Act.  Research has shown that Community Development Financial Institutions (CDFIs) loans are high performing, although in most cases they are nontraditional and do not meet the underwriting and collateralization standards required by conventional banks. As a result, there is not a vibrant secondary market where CDFIs can sell these loans to investors. This legislation will kickstart a CDFI secondary market so CDFIs have access to loan purchasers to obtain the capital needed to finance additional community and economic development activities for underserved people and communities,” said Matt Josephs, Senior Vice President for Policy, LISC.

“Each year, the 47 certified Tennessee Community Development Financial Institutions (CDFIs) create thousands of jobs, expand access to affordable housing, finance over 2 million sq. ft. in new or renovated real estate, improve energy efficiency, and make hundreds of millions in loans and investments into Tennessee businesses, nonprofits, and community facilities. The Scaling Community Lenders Act pilot program would provide CDFIs with new and innovative liquidity resources to explore secondary markets, unlocking more capital and expanding our ability to serve Tennessee communities. We commend Senators Hagerty and Warner for thinking outside of the box on this promising initiative,” said Hank Helton of Pathway Lending and Chris Miller of Three Roots Capital.

“The CDFI Coalition is pleased to add its voice in strong support for the legislation sponsored by Sens. Warner and Hagerty to establish a pilot program aimed at establishing a secondary market for loans made by Community Development Financial Institutions (CDFIs). The Scaling Community Lenders Act of 2022 amends the Community Development Banking and Financial Institutions Act of 1994 to authorize $100 million for funding up to 6 pilot programs, selected on a competitive basis, which would purchase CDFI loans and loan participations,  provide guarantees, loan loss reserves and lines of credit and other measure necessary to enhance CDFI liquidity. CDFIs emerged to provide financial services in urban neighborhoods and rural areas underserved by traditional financial institutions, particularly those with high rates of poverty and unemployment,” said Ceyl Prinster, President and CEO, Colorado Enterprise Fund and Chair of the CDFI Coalition. “By leveraging over $12 in private capital to every $1 in federal support, CDFIs are filling the widening credit gap encountered in many communities, creating jobs improving housing and community facilities and creating economic opportunity. Throughout the last economic downturn, CDFIs provided flexible and patient capital, rigorous risk management, and commitment to the projects in their communities and the sustainability of their borrowers. While traditional borrowers fled economically distressed communities, CDFIs stepped in and filled the void. Since the advent of the economic crisis prompted by the pandemic, CDFIs have been on the frontlines of providing technical and financial assistance to small and minority-owned businesses. CDFIs fill a vital niche in the nation's financial services delivery system by serving communities and market sectors that conventional lenders cannot - with the ultimate goal of bringing CDFI customers into the mainstream economy as bank customers, home owners and/or entrepreneurs. We believe that the Scaling Community Lenders Act will enhance the ability of CDFIs to support economic revitalization in economic distressed rural, urban, minority and tribal communities.  Establishing a secondary market for CDFI loans will be increase the availability of capital to CDFIs that will put it to good use in financing affordable housing, small businesses, and community facilities.”

To combat the hemorrhaging of jobs and economic opportunities during the pandemic, Sen. Warner has been a leader in Congress for CDFIs and MDIs. In July of 2020, he teamed up with then-Sen. Kamala Harris (D-CA), Sen. Cory Booker (D-NJ), and a bipartisan group of colleagues to introduce the Jobs and Neighborhood Investment Act.

Sen. Warner was later able to secure provisions from the bill in the Coronavirus Response and Relief Supplemental Appropriations Act of 2021, which was signed into law on December 27, 2020, providing an unprecedented $12 billion in funding for CDFIs. Last month, Sen. Warner led a bipartisan group of colleagues in introducing  legislation to support lenders that focus on underserved communities by creating a CDFI Tax Credit for private sector investors that make equity, equity-equivalent investments, or long-term patient capital available to CDFIs.  

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WASHINGTON – Today, U.S. Sen. Mark R. Warner (D-VA) was joined by Sens. Roger Wicker (R-MS), Chris Van Hollen (D-MD), and Cindy Hyde-Smith (R-MS) in introducing bipartisan legislation to promote lasting economic prosperity in Black, brown and low-income communities. This bill would help unlock more equity and long-term financial capital for community development financial institutions (CDFIs). CDFIs often serve as a backbone for low-income or minority-owned businesses, which tend to have fewer banking relationships and less access to traditional forms of funding. 

“As a former entrepreneur and venture capitalist, I know that talent and ambition is not confined by income bracket or zip code. Unfortunately, access to start-up capital often is. CDFIs and MDIs do the invaluable work of bridging the gap and reaching small businesses in our most vulnerable communities – a role that became even more critical during the pandemic,” said Sen. Warner. “Despite the historic investments we were able to deliver through the emergency COVID-19 relief package, CDFIs remain in need of additional equity and capital to continue serving their communities. This legislation will create a new tax credit, helping spur important private-sector investments and allowing these community lenders to grow."

“Small businesses, including those in low-income and minority communities, are a pillar of the economy in Mississippi and across the nation,” said Sen. Wicker. “CDFIs and MDIs help support businesses, individuals, and entrepreneurs by providing access to capital and alternatives to predatory loans in low-access areas. I am glad to join my colleagues on this bipartisan measure to create an additional tax credit to support and expand this private-sector investment.”

“CDFI investments are a critical source of capital for small business growth in many Mississippi communities and around the country.  This bill would create a tax credit structure to attract greater private-sector investments in CDFIs, which would increase their ability to spur more long-term growth in disadvantaged areas,” said Sen. Hyde-Smith.

“Investing in our small businesses generates more shared prosperity in our communities and CDFIs are a key force multiplier, particularly in financing businesses and projects in economically underserved communities. This legislation will leverage long-term, private sector investments to support their good work and help them expand their efforts to support new and growing small businesses,” said Sen. Van Hollen.

This bill will help direct support to lenders that focus on underserved communities by creating a CDFI Tax Credit for private sector investors that make equity, equity-equivalent investments, or long-term patient capital available to CDFIs. The bill would benefit CDFIs of all types including bank CDFIs, credit union CDFIs, venture capital CDFIs, and CDFI loan funds, while providing institutions with the maximum flexibility and financial support they need to increase wealth in low- and moderate-income communities.

Bill text is available here. A one-pager of the bill is available here.

This legislation has the support of a number of organizations, including Community Development Bankers Association, National Association of Affordable Housing Lenders, Community Development Venture Capital Alliance, LISC, Opportunity Finance Network, CDFI Coalition, Inclusiv, and the Enterprise Community Loan Fund, among others.

“CDBA and its members strongly support the CDFI Tax Credit Investment Act.  The credit will provide an invaluable tool for leveraging private investment into underserved markets.  This will be a game changer,” said Jeannine Jacokes, Chief Executive Officer, Community Development Bankers Association.

“The CDFI Tax Credit Act is a practical, bipartisan way to marshal the long-term capital that struggling urban and rural communities need. It will create jobs, grow small businesses, and strengthen families by providing health services and child care. It's a smart investment in America's future,” said Buzz Roberts, President & CEO, National Association of Affordable Housing Lenders.

“CDVCA strongly supports the CDFI Tax Credit Investment Act.  It will give incentive for investors to provide flexible, long-term risk capital to create good jobs, productive wealth, and entrepreneurial capacity in underinvested communities throughout the nation,” said Kerwin Tesdell, President, Community Development Venture Capital Alliance.

“The Local Initiatives Support Corporation (LISC) applauds Senators Warner and Wicker for introducing the Community Development Tax Credit Act of 2022.  Community Development Financial Institutions (CDFIs) have time and time again proven their ability to leverage public and private capital to support investments in some of the most underserved communities in the country.  This tax credit, by incentivizing long term investments in CDFIs, will allow CDFIs to in turn provide longer term, lower cost loans to finance affordable housing, small businesses, homeownership and essential community facilities in their neighborhoods,” said Matt Josephs, Senior Vice President for Policy, LISC.

“OFN applauds Senators Warner and Wicker’s continued leadership in supporting community development financial institutions (CDFIs). The CDFI Tax Credit Investment Act will help drive more private capital to CDFIs offering affordable, responsible financing to low-wealth urban, rural, and Native communities across the country,” said Jennifer A. Vasiloff, Chief External Affairs Officer, Opportunity Finance Network.

“The CDFI Coalition is pleased to add its voice in strong support for the legislation sponsored by Sens. Warner and Wicker to establish a tax credit for Community Development Financial Institutions (CDFIs). CDFIs provide financial products and services in urban neighborhoods and rural areas underserved by traditional financial institutions, particularly those communities with high rates of poverty and unemployment. Throughout the last economic downturn, CDFIs served as economic shock absorbers, providing flexible and patient capital, rigorous risk management, and commitment to the projects in their communities and the sustainability of their borrowers. While traditional lenders fled economically distressed communities, CDFIs stepped in to fill the void. Since the advent of the economic crisis prompted by the pandemic, CDFIs have been on the frontlines of providing financial and technical assistance to small and minority-owned businesses. CDFIs fill a vital niche in the nation's financial services delivery system by serving communities and market sectors that conventional lenders cannot - with the ultimate goal of bringing CDFI customers into the mainstream economy as bank customers, homeowners and/or entrepreneurs. The proposed CDFI Tax Credit will provide a new avenue for CDFIs to raise capital that will be deployed to finance small businesses, construct affordable housing, and support community facilities in disadvantaged communities across the country. CDFIs leverage over $12 in private capital to every $1 in federal support, so the resources authorized by the tax credit will extend far beyond the amount authorized and help CDFIs to fill the widening credit gap encountered by economically disadvantaged communities across the country,” said Ceyl Prinster, President and CEO, Colorado Enterprise Fund and Chair of the CDFI Coalition.

“CDFI credit unions deliver credit and responsible banking services in communities long-excluded by the financial system.  Credit union lending runs the gamut from helping households access small emergency loans to meet basic needs; to repairing; to purchasing that first home or starting or expanding a small business.  Together CDFI credit unions are able to channel and recycle billions of dollars of loans in local economies across the country.  In order to grow reach and impact, these high-impact lenders need long-term equity like investment.  The proposed legislation by Senators Warner and Wicker to establish a CDFI Tax Credit is groundbreaking.  This bill will provide an incentive for private sector investors to make flexible long-term investments that enable our institutions to grow, expand their lending and increase wealth in low- and moderate-income communities,” said Cathie Mahon, President and CEO, Inclusiv. 

“Senators Warner and Wicker's innovative proposal to drive more resources into our communities is forward-thinking and much needed. CDFIs, whose missions are to create economic opportunity for all, already leverage private capital sources to develop community-centered investments and sustain the communities they serve. Unfortunately, the community need is outpacing the resources available to CDFIs. Additional investment options like the CDFI Tax Credit will be a game-changer for the industry across the country. The VA CDFI Coalition is excited by the possibilities these investments could create across Virginia and hope to see this pass,” said Leah Fremouw, Board President, VA CDFI Coalition.

“Enterprise enthusiastically supports the CDFI Tax Credit Act introduced by Senators Warner and Wicker. The legislation exponentially builds on the power of CDFIs to leverage private capital and supercharges their work to address systemic inequities in access to capital in low-income communities. Over three decades, we've invested $2.4 billion in under-served communities, and we know that CDFI investments are key to equitable development and broad-based economic growth,” said Elise Balboni, President, Enterprise Community Loan Fund.

To combat the hemorrhaging of jobs and economic opportunities during the pandemic, Sen. Warner has been a leader in Congress for CDFIs and MDIs. In July of 2020, he teamed up with then-Sen. Kamala Harris (D-CA), Sen. Cory Booker (D-NJ), and a bipartisan group of colleagues to introduce the Jobs and Neighborhood Investment Act – an effort that secured endorsements from a host of other advocacy organizations and civil rights groups. 

Sen. Warner was later able to secure provisions from the bill in the Coronavirus Response and Relief Supplemental Appropriations Act of 2021, which was signed into law on December 27, 2020, providing an unprecedented $12 billion in funding for CDFIs.

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WASHINGTON – U.S. Sen. Mark R. Warner (D-VA) led a letter to Mr. Gene L. Dodaro, Comptroller General of the U.S. Government Accountability Office (GAO), asking for a study on supporting the technology modernization needs of Community Development Financial Institutions (CDFIs) and Minority Depository Institutions (MDIs). This study – part of a suite of efforts by the Senator to support CDFIs and MDIs – would help lay the groundwork for additional measures related to CDFI and MDI technology modernization. Sen. Warner was joined in sending the letter by House Financial Services Committee Chairwoman Maxine Waters (D-CA).

“In the Federal Reserve’s annual survey of CDFIs, more than 75% of CDFIs indicated they were unable to provide all the products or services they would like to offer on a sustained basis. In addition to further federal capital support, increasing access to technology tools will play a critical role as CDFIs and MDIs begin to leverage the historic funding provided by Congress. Technology resources can further empower community-based lenders with deep expertise and an understanding of their communities’ needs,” wrote the lawmakers. “There have been several private-sector and philanthropic efforts and partnerships to support technology investments in CDFIs and MDIs. In addition, several think tanks and policy organizations have highlighted these investments as a critical need for supporting CDFIs, MDIs, and the communities they serve. We are requesting GAO examine the scope of CDFIs and MDIs’ needs in technology and what else the federal government could do to support those needs.”

Beyond capital and staffing constraints, another significant barrier for CDFIs and MDIs is access to technology, because the cost to implement new systems is expensive and difficult to prioritize against the more immediate challenges of raising capital, staffing, and delivering for their communities. However, CDFIs and MDIs’ experience with the Paycheck Protection Program showed that technology investments can increase efficiency, support more lending, and improve the ability of these institutions to serve their communities.

To combat the hemorrhaging of jobs and economic opportunities during the pandemic, Sen. Warner has been a leader in Congress for CDFIs and MDIs. Most recently, Sen. Warner introduced legislation with Sens. Roger Wicker (R-MS), Cindy Hyde-Smith (R-MS), and Chris Van Hollen (D-MD) to deliver more long-term patient capital for CDFIs.

Sen. Warner also led successful efforts to secure a historic, $12 billion investment in CDFIs and MDIs in the Coronavirus Response and Relief Supplemental Appropriations Act of 2021, which was signed into law on December 27, 2020. Of that $12 billion, $9 billion was used to create the Emergency Capital Investment Program (ECIP) to make tier one capital investments in depository CDFIs and MDIs. The Department of Treasury began to close on ECIP investments earlier this year and is expected to be finished closing its investments in the coming months. The remaining $3 billion in grant funding is also in the process of being fully distributed. On June 15, 2021, Treasury awarded the first tranche of $1.25 billion through the Rapid Response Program to 863 CDFIs. In addition, this week, Treasury opened the Equitable Recovery Program, the remaining $1.75 billion, up for applications.

A copy of the letter is available here.


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WASHINGTON – U.S. Sen. Mark R. Warner (D-VA) today applauded $21,649,505 in federal funding from the U.S. Department of Treasury to support and advance business ownership among minority entrepreneurs in Virginia. The funding was awarded through the CDFI Rapid Response Program (RRP) – a program established and funded by a record $12 billion investment in Community Development Financial Institutions (CDFIs) and Minority Depository Institutions (MDIs) that Sen. Warner authored and successfully fought to include in the December COVID-19 relief legislation. 

“As a former entrepreneur and venture capitalist, I know that the kind of opportunities that once allowed me to succeed are often out of reach for Black and brown folks, who due to historic and systemic inequities often lack the credit history or banking relationships needed to access capital. To make matters worse, these inequalities have only been exacerbated by the COVID-19 pandemic, which has had disproportionate effects on minority and low-income communities,” said Sen. Warner. “This funding will provide critical resources to Virginia’s CDFIs, which specialize in supporting underserved communities. I’m thrilled to know that these dollars are now headed directly to Virginia to support key priorities including small businesses, affordable housing, and access to consumer financial services. This funding marks a successful first step towards ensuring the recovery is felt by all communities.”

As negotiated by Sen. Warner, the $12 billion investment in CDFIs and MDIs includes $3 billion in grants to be delivered through the CDFI Fund. The nearly $22 million awarded today is part of the first $1.25 billion tranche of that $3 billion in grant funding. These federal dollars will be distributed among 18 Virginia CDFIs – the financial institutions most connected to the Commonwealth’s minority communities – and will ultimately go towards supporting affordable access to credit for Virginians in Black, Latino and low-income communities. 

The funding will be distributed as follows:

Appalachian Community Capital Corporation

Christiansburg

 $1,826,265

ARN CAPITAL, LLC

Fredericksburg

 $200,000

Business Seed Capital, Inc.

Roanoke

 $200,000

Capital Impact Partners

Arlington

 $1,826,265

Community Business Partnership

Springfield

 $997,000

Community Investment Collaborative

Charlottesville

 $360,000

Democracy FCU

Alexandria

 $1,826,265

DuPont Community Credit Union

Waynesboro

 $1,826,265

ECDC Enterprise Development Group

Arlington

 $1,278,385

Freedom First Federal Credit Union

Roanoke

 $1,826,265

People Incorporated Financial Services

Abingdon

 $1,400,000

Peoples Advantage Federal Credit Union

Petersburg

 $1,826,265

Piedmont Housing Alliance

Charlottesville

 $279,000

RVA Financial Federal Credit Union

Richmond

 $1,826,265

Southeast Rural Community Assistance Project, Inc.

Roanoke

 $375,000

Virginia Community Capital, Inc.

Richmond

 $1,826,265

Virginia Community Development Fund, Inc.,

Richmond

 $1,750,000

The Virginia Foodshed Capital

Charlottesville

 $200,000

 

Total:

 

 

$21,649,505

The COVID-19 crisis has only served to exacerbate the existing economic challenges faced by Black and brown Americans. Throughout this crisis, thousands of minority-owned small businesses have closed for good, in part due to difficulty securing bank loans and accessing assistance such as the Paycheck Protection Program. The Federal Reserve Bank of New York found that while overall small business ownership in the U.S. dropped 22 percent between February and April 2020, Black and Latino ownership dropped by 41 percent and 32 percent, respectively. Unemployment rates for Black and brown Americans have also been consistently higher than that of White Americans.

To combat the hemorrhaging of jobs and economic opportunities during the pandemic, Sen. Warner in July teamed up with then-Sen. Kamala Harris (D-CA), Sen. Cory Booker (D-NJ), and a bipartisan group of colleagues to introduce the Jobs and Neighborhood Investment Act in order to strengthen the financial institutions that serve communities of color and increase lending to minority-owned businesses and lower-income borrowers. The effort secured endorsements from the Black Economic Alliance, the NAACP, the National Bankers Association, the National Urban League, the Center for Responsible Lending and a host of other advocacy organizations and civil rights groups. Sen. Warner was later able to secure provisions from the bill in the Coronavirus Response and Relief Supplemental Appropriations Act of 2021, which was signed into law on December 27, 2020, providing an unprecedented $12 billion in funding for lenders that predominantly operate in underserved communities.

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WASHINGTON -  U.S. Senator Mark R. Warner (D-VA) and Congresswoman Maxine Waters (D-CA), Chairwoman of the House Financial Services Committee, sent a letter to Treasury Secretary Janet Yellen urging the extension of the Emergency Capital Investment Program (ECIP) application deadline to ensure the highest level of participation from eligible community development financial institutions (CDFIs) and minority depository institutions (MDIs).

“We know Treasury is committed to implementing this historic, $9 billion investment in MDIs and CDFIs, and that your staff is committed to ensuring ECIP meets its transformative potential. While we are encouraged by the speed at which Treasury has implemented the program, we are concerned that key questions are unanswered,” wrote the lawmakers. “…We urge Treasury to continue to work with industry stakeholders to identify the additional guidance needed to ensure there is robust participation in ECIP. While Treasury has already demonstrated it will thoughtfully implement ECIP, eligible institutions’ concerns should be considered and fully evaluated before the deadline to apply for ECIP closes.”

See the full text of the letter below. 

The Honorable Janet Yellen
Secretary
U.S. Department of the Treasury 
1500 Pennsylvania Avenue, Northwest
Washington, D.C. 20002

Dear Secretary Yellen:

We write to urge the Department of the Treasury (Treasury) to extend the Emergency Capital Investment Program (ECIP) application deadline. Extending the deadline would ensure eligible Community Development Financial Institutions (CDFIs) and Minority Depository Institutions (MDIs) have the time and information necessary to apply for the program. Key industry stakeholders have raised concerns that further guidance and time are needed to ensure eligible institutions take advantage of the resources available through ECIP.

We know Treasury is committed to implementing this historic, $9 billion investment in MDIs and CDFIs, and that your staff is committed to ensuring ECIP meets its transformative potential. While we are encouraged by the speed at which Treasury has implemented the program, we are concerned that key questions are unanswered. For example, we understand that guidance that affects institutions’ eligibility, capital offerings, compliance, and reporting still needs to be published. As a result, institutions that would otherwise participate are hesitant to do so and may be unable to apply by the current deadline of May 7, 2021. 

We urge Treasury to continue to work with industry stakeholders to identify the additional guidance needed to ensure there is robust participation in ECIP. While Treasury has already demonstrated it will thoughtfully implement ECIP, eligible institutions’ concerns should be considered and fully evaluated before the deadline to apply for ECIP closes.

We appreciate your commitment to this historic program and ensuring ECIP is successful. We look forward to our continued collaboration implementing ECIP and supporting CDFIs and MDIs, which play a critical role in supporting access to capital in underserved communities.

Thank you for your attention to this important issue.


Sincerely,

Mark R. Warner
United States Senator

Maxine Waters
Chairwoman, Committee on Financial
Services, U.S. House of Representatives


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