Bush Budget Slashes CDFIFunding

WASHINGTON - (02/08/05) -- The budget proposal for fiscal 2006introduced by the White House Monday would cut appropriations forthe 10-year-old Community Development Financial Institutionsprogram, which has nurtured dozens of low-income credit unions, tothe bone. The spending plan would provide just $8 million for thefund, down from $55 million last year and just barely enough toadminister existing programs. Cliff Rosenthal, executive directorof the National Federation of CDCUs and one of the progenitors ofthe CDFI Fund, said he hopes affiliated interests will work torestore some of the funding during the coming budgeting process inCongress. "The thing to keep in mind is this is just the openinggambit in a very serious and vigorous battle," Rosenthal told TheCredit Union Journal. He said the cuts, if finalized, will not meanlife or death for the dozens of credit unions that count on CDFIgrants and loans but could severally hamper their ability to growand expand, especially when combined with other cuts in low-incomeaid proposed by the Bush Administration. Last year 10 credit unionsor affiliated organizations received $7 million in CDFI backing,while 60 credit union or affiliates have received more than $42million in CDFI assistance during the 10 years of theprograms.