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NAFCU highlights CDFI Fund, CDRLF concerns as House considers approps bill
NAFCU Vice President of Legislative Affairs Brad Thaler wrote to House Speaker Nancy Pelosi, D-Calif., and House Republican Leader Kevin McCarthy, R-Calif., Tuesday expressing credit union views regarding the Fiscal Year 2023 Financial Services and General Government (FSGG) appropriations bill that began consideration yesterday and will be voted on today, along with five other FY 2023 funding measures.
The FSGG bill, which cleared the Appropriations Committee last month, includes $336.4 million in funding for the Community Development Financial Institutions (CDFI) Fund and $4 million in funding for the Community Development Revolving Loan Fund (CDRLF). NAFCU has previously advocated for this increased level of funding for both the CDFI Fund and CDRLF to better provide resources needed to keep the programs properly functioning.
However, Thaler notes in the letter that the CDFI Fund is making changes to the certification process that will likely make it more difficult for small and minority depository institution (MDI) credit unions to become certified. Thaler addressed specific credit union concerns, including:
- a number of credit unions have reported long delays stemming over 12 months to respond to their applications for certification;
- several credit unions currently no longer qualify for the CDFI Fund and have subsequently lost their status as a CDFI without any chance to take remedial action and re-qualify; and
- changes being made to the CDFI Fund certification process will likely make it more difficult for small and minority depository institution (MDI) credit unions to become certified.
“This would seem to be contrary to the steps Congress is taking to try to expand the use of CDFIs to help communities in need,” wrote Thaler. “We encourage you to examine this issue and urge the CDFI Fund to address these concerns, such as instituting a cure period for CDFIs that are in danger of losing certification and directing the CDFI Fund and functional regulators, such as the NCUA, to work more closely to reduce burdens on CDFI institutions.”
Last month, Thaler wrote to the House Appropriations Committee ahead of their markup of the bill, expressing support for the funding inclusion as the programs “have proven to be an invaluable means of providing financial services to underserved areas and demonstrated their worth during the pandemic.”
NAFCU will monitor movement on the FSGG appropriations package and keep credit unions up-to-date on these issues via NAFCU Today.