Flat CDFI Funding Rare "Highlight" in House VA, HUD, Independent Agencies Bill

In an appropriations bill where cuts are viewed as good news -- compared to the President's request for program termination, that is -- the small Community Development Financial Institutions (CDFI) Fund could consider itself very lucky after Friday's full House Appropriations Committee mark-up of the VA-HUD and Independent Agencies bill.

CDFI would receive $60.4 million in fiscal year 2005. The funding level is equal to the FY 2004 appropriation, but $12 million over what the Administration had requested for next year. Authorized in 1994, CDFI's goal is  to expand the availability of credit, investment capital, and financial services in distressed urban and rural communities. Funding activities leverage private-sector investments from banks, foundations, and other funding sources. Programs administered by the CDFI include the New Market Tax Credits.

Appropriations for CDFI have decreased steadily since FY 2001, when it received $118 million.

Local economic development strategies dependent on some of the other elements of the bill may breathe a small sigh of relief knowing the House Appropriations Committee voted to restore several programs proposed for termination in the President's request. Those programs face a 4 percent cut over FY 2004 levels, however, leaving $24 million for Rural Housing and Economic Development, $14 million for Round II Empowerment Zones/Enterprise Communities, and $24 million for Brownfields Redevelopment.

Full House consideration of the bill is not expected before the summer recess.

More information on the CDFI Fund is available from the U.S. Department of Treasury at http://www.cdfifund.gov/.