In a vote of 220 to 207 on the floor of the United States House of Representatives, a set of six federal funding bills for fiscal year 2023 adopted to proceed to the appropriations process. The program included levels of funding from the Community Development Financial Institutions Fund (CDFI) and the Community Development Revolving Loan Fund (CDRLF).
The most important part for credit unions was the 2023 Financial Services and Government Funding, which included:
- $336 million for the CDFI Fund, which provides capital grants, equity investments and technical assistance grants to certified CDFIs.
- $4 million for the CDRLF, which funds a revolving loan program and a technical assistance program.
In a statement, CUNA President and CEO Jim Nussle wrote, “This funding will help combat the lingering effects of the COVID-19 emergency on the ability of small businesses and individuals to access credit and services. basic finance.
While the overall budget for the 2023 portion of financial services and public administration is $4.3 billion, 17% higher than fiscal 2022, CUNA and NAFCU were calling for at least a budget of $6 million. dollars for the CDRLF.
The other concern, according to NAFCU Vice President of Legislative Affairs Brad Thaler, “is that the CDFI Fund is making changes to the certification process that will likely make it more difficult for small minority deposit-taking institutions to certify credit unions. (MDI).”
In a letter to House leaders, Thaler addressed specific concerns, including:
- A number of credit unions reported long delays of more than 12 months in responding to their certification requests.
- Several credit unions are currently no longer eligible for the CDFI Fund and have subsequently lost their CDFI status without any opportunity to take corrective action and requalify.
- Changes to the CDFI Fund certification process will likely make it more difficult for small credit unions and MDIs to obtain certification.
“This would seem contrary to steps taken by Congress to try to expand the use of CDFIs to help communities in need,” Thaler wrote. “We encourage you to consider this matter and urge the CDFI Fund to address these concerns, such as instituting a cure period for CDFIs that are at risk of losing their certification and directing the CDFI Fund and functional regulators, such as the NCUA, to work more closely to reduce the burdens on CDFI institutions.