The budget bill just passed by Congress threatens to drastically underfund U.S. Treasury’s CDFI Fund. The 1,500 Treasury-certified Community Development Financial Institutions (CDFIs) nationwide are private, mission-driven institutions that invest, lend, and deliver responsible, affordable financial services to economically-burdened communities, including in the Â黨ÊÓƵ area.
While corporate America has Wall Street, Main Street America relies on CDFIs.
CDFIs foster public-private partnerships that create jobs, start and grow businesses, and build and improve affordable housing and community facilities. By pooling together public and private funds with flexible structuring, CDFIs facilitate projects with community benefits that neither the private sector nor the public sector can accomplish on their own in challenging markets with perceived risks. CDFIs leverage over $12 in private capital for every $1 in federal support.
CDFIs’ biggest partner is the Treasury’s CDFI Fund which has long had solid bipartisan congressional support. However, in this environment of slashing budgets, CDFIs risk losing a majority of FY 26 annual federal appropriation of $324 million. The administration has also withheld $251 million of previously appropriated funds for FY 25, disregarding congressional authority over appropriations!
This funding offers a lifeline for projects bringing economic prosperity to distressed areas. Between 2010 and 2022, Virginia’s 21 CDFIs were responsible for:
Lending $2.6 Billion across 21,356 loans to create/maintain 37,643 permanent jobs
Created 2,028 education/childcare seats
Financed 9,122 small businesses
Created 18,606 housing units
Financed 9,486 consumer loans, including down-payment loans to first-time homebuyers.
For example, the CDFI I direct, Virginia Community Development Fund, provided a $12 million New Market Tax Credit equity investment in Â黨ÊÓƵ’s Center in the Square for its revitalization, infrastructure improvements, and expansion. Center in the Square has helped launch over 350 new businesses and has sparked more than $850 million in development projects throughout Â黨ÊÓƵ’s downtown.
Call your Members of Congress — Rep. Ben Cline and Sens. Mark Warner and Tim Kaine—and ask them to level-fund Treasury’s CDFI Fund at $324 million for FY 26 and restore FY 25 funding.
