WASHINGTON–The Senate has formed a new Senate Community Development Finance Caucus. The bipartisan caucus is being described as an effort to boost access to capital in low- and moderate-income communities by scaling the missions of community development financial institutions (CDFIs) and minority depository institutions (MDIs).
The caucus was announced by Senators Mark Warner (D-VA) and Mike Crapo (R-ID). Other members of the caucus include 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), and Rev. Raphael Warnock (D-GA).
“CDFIs and MDIs play an essential role in providing access to capital in underserved communities,” said Warner. “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.”
‘Success Stories’
Added Crapo, “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. 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.”
Praise from Community Group
San Jose, Calif.-based Accion Opportunity Fund (AOF) joined other groups in praising formation of the caucus.
“Small businesses remain heroes of the U.S. economy, even as they are hit hard by economic pressures, labor market dynamics, and supply chain constraints. But our research has found that every day, banks decline 8,000 small dollar loan applications, creating an $87 billion gap in responsible capital for small businesses,” the organization said. “The creation of the Senate Community Development Finance Caucus is a recognition that community development financial institutions (CDFIs) and minority depository institutions (MDIs) are our most successful tool for filling this gap.”
A slide deck with more information on the new caucus can be found here.