WASHINGTON—A Trump Administration effort to take back $174-million already appropriated for the Community Development Financial Institutions (CDFI) program is being opposed by the credit union trade associations.
Of that amount, $151 million would be cut from the Capital Magnet Fund, part of the CDFI Fund. CDFI credit unions use grants from the Capital Magnet Fund to finance affordable housing solutions and community revitalization efforts that benefit low-income people and communities nationwide.
The Trump Administration request was included in a $15-billion rescission package the Trump administration sent to Capitol Hill this week.
Earlier this year, full funding of $250 million was granted for the Treasury Department's CDFI Fund by Congress after the administration’s fiscal year 2018 budget zeroed out the fund.
The credit union trade groups and others had earlier lobbied Congress to fully fund the program in order to ensure credit unions can continue to provide financial stability for low-income members and their families, as CDFI credit unions predominantly serve low-income areas and are often the only financial services option.
NAFCU noted it specifically met with the Treasury Department to discuss the importance of this program. In 2016, the NCUA and Treasury signed a memorandum of understanding to facilitate increased credit union involvement in the fund, with the aim of doubling the number of CDFI-certified credit unions.
In response to the Administration proposal, CUNA CEO Jim Nussle said, “CUNA strongly opposes rescission from funds that have already been authorized, particularly funds that credit unions are able to leverage for much-needed affordable housing solutions in the communities they serve. CUNA will continue our engagement with appropriators and other officials to ensure these important funds remain available for credit unions and other CDFIs that support community revitalization.”