WASHINGTON— With the Trump Administration’s FY 2027 budget proposal again putting pressure on federal community development programs, the Defense Credit Union Council is urging Senate appropriators to preserve full funding for the Treasury Department’s Community Development Financial Institutions Fund, warning the program remains critical to credit unions serving military, veteran and underserved communities.
Ahead of a Senate Appropriations Subcommittee on Financial Services and General Government hearing on Treasury’s FY 2027 budget request, DCUC said in a letter to the subcommittee that lawmakers should fund the CDFI Fund at no less than its current enacted level, arguing any erosion in support would directly undercut access to affordable financial services in communities many defense credit unions are specifically structured to reach.
“Defense credit unions rely on this program to deliver affordable financial services, small-dollar lending, and financial readiness support to servicemembers, veterans, and military families particularly in underserved and installation-adjacent communities,” said Jason Stverak, DCUC chief advocacy officer. “We believe there is a pressing need for improved execution within Treasury, including reducing application complexity, accelerating award timelines, and ensuring that smaller, mission-driven institutions are not disadvantaged in accessing these critical resources.”
Given the direct connection between financial stability and military readiness, DCUC voiced that sustained investment in the CDFI Fund is not only sound economic policy but further translates to a national security imperative. The letter also included DCUC's suggested questions for the record for Treasury Secretary Bessent focused on funding levels, program structure, and Treasury’s administration of the CDFI Fund.
Letter To HFSC Subcommittee
Separately, DCUC engaged leaders of the House Financial Services Subcommittee on Housing and Insurance ahead of Wednesday's hearing titled, “Diversifying Risk: The Benefits of Reinsurance and Credit Risk Transfers.” See the letter here.
DCUC voiced its strong support for prudent risk-sharing mechanisms that enhance market stability and protect taxpayers, while ensuring these frameworks remain accessible and workable for community-based lenders, including credit unions.
“We’re requesting the Subcommittee evaluate how credit risk transfer structures and insurance market reforms impact liquidity, operational access, and mortgage affordability for all communities served by credit unions, especially servicemembers, veterans, and their families,” said Stverak.
DCUC offered several policy recommendations for the Subcommittee’s consideration, including:
- Ensuring transparency and oversight of credit risk transfer impacts on small and mid-sized lenders• Advancing long-term reauthorization of the National Flood Insurance Program with private reinsurance and affordability safeguards
- Preserving and expanding credit union access to FHA, VA, Ginnie Mae, and Federal Home Loan Bank liquidity channels
- Promoting interagency coordination to address housing and insurance challenges in military communities
“DCUC and our member credit unions remain committed to working with the Subcommittee to advance practical, bipartisan solutions that strengthen housing finance markets while preserving access to affordable credit for those who serve our nation," Stverak added.