CDFI Fund Mostly 'Unscathed'
NEW YORK — The National Federation of Community Development Credit Unions said that despite significant cuts to community development programs in the Obama administration's recently released FY2012 budget, the Community Development Financial Institutions (CDFI) Fund has emerged relatively unscathed.
The President has requested $227.2 million for FY2012, a slight reduction from the FY2010's $247 million; the amount was a carry-over into FY2011 through Continuing Resolutions.
"There is a lot of bad news for low-income people in the President's budget proposal for Fiscal Year 2012: cuts in Community Development Block Grants, Community Service Block Grants, and low-income heating assistance, just to name a few," said Federation President/CEO Cliff Rosenthal. "But it is striking that the administration's proposal strongly supports the CDFI Fund, with only a modest overall cut. Moreover, it requests funding for two innovative initiatives, the Bank on USA and the Healthy Food Financing Initiative, which were included in the FY2011 budget, but are vulnerable if Congress only passes Continuing Resolutions at a reduced level, rather than the previously proposed budget."
The CDFI Fund has been a major source of equity capital for CDCUs, providing nearly $100 million since the Fund was established in 1995. The Fund provided more than $12 million to CDCUs in 2010, the Federation reported.
The CDFI Coalition, of which the Federation is a founding member, said it will be rallying supporters of the Fund to fight these potential cuts.