WASHINGTON - The House is expected to begin consideration today of a package of funding rescissions that includes a cut of $125 million authorized for the Community Development Financial Institutions fund.
Legislative sources predict the House will vote to cut the CDFI funding. One House Banking Committee staffer said the program's fate is sealed because in order to offer an amendment to save CDFI funding, a lawmakers would have to offer an offsetting cut.
"It's going to be a very, very tough uphill fight," he said.
Senate legislative sources said saving CDFI funds may be difficult because orders to rescind the CDFI funds have come directly from Senate leadership. However, one industry source said there are important pockets of support for CDFI on Senate Appropriations.
"We have written support from Sen. Pete Domenici, and we believe we have support from Appropriations Chairman Mark Hatfield," said Mark Pinsky, executive director of the National Association of Community Development Loan Funds. Sen. Domenici, R-N.M., serves on Appropriations.
The program was touted by President Clinton in his 1992 campaign speeches as a way to provide seed money to lenders that would help small businesses located in low-income communities.
The CDFI bill enacted last year authorizes $382 million for community development institutions over the next four years.
If appropriated, the money would be distributed through an independent agency, called the CDFI Fund.
The Senate Appropriations subcommittee on veteran's affairs, housing and urban development, and independent agencies is expected to begin action on a package that includes a CDFI rescission in July, according to an aide in that committee.
