Message from CDFI Fund Director Pravina Raghavan: Finishing 2024 with a Flurry and Looking Forward into 2025

The Community Development Financial Institutions Fund (CDFI Fund) has had a busy fall. Since I last checked in, back in July, we have announced nearly $700 million in awards through the fiscal year (FY) 2024 rounds of the Bank Enterprise Award Program (BEA Program), Community Development Financial Institutions Program (CDFI Program) and Native American CDFI Assistance Program (NACA Program) Financial Assistance Awards, as well as the Capital Magnet Fund. Additionally, the CDFI Fund allocated $5 billion in New Markets Tax Credits (NMTCs) under the calendar year (CY) 2023 round of the NMTC Program and issued guarantees totaling $498 million under the FY 2024 round of the Bond Guarantee Program—the largest in the history of the program.

To support Community Development Financial Institutions (CDFIs) applying for recertification under the revised CDFI Certification Application, the CDFI Fund also released an updated Frequently Asked Questions (FAQs) document, Pre-Approved Target Market Assessment Methodology guidance, and template of the CDFI Certification Agreement. The CDFI Certification Application timeline for early submitters was also adjusted, which recently opened on October 28^th and extends through January 6, 2025. And, in case you missed it, new recorded training webinars, an updated FAQs document, and the Low-Income Calculator, were recently added to the CDFI Fund’s website.

Many of you are also aware that Secretary Yellen announced a new program back in June that will be administered by the CDFI Fund. The new program will primarily focus on increasing the supply of affordable housing. We are still in the planning stages; however, we hope to share information about this program, as well as a new pilot grant program that will fund CDFIs seeking to improve their technology systems, early in CY 2025. Both initiatives will be supported by proceeds from the Emergency Capital Investment Program.

Additionally, as part of the Treasury Department’s efforts to grow CDFI access to capital, we recently announced the launch of a joint working group with the Federal Housing Finance Agency (FHFA) that will examine ways in which CDFIs can gain increased access to Federal Home Loan Bank (FHLB) capital. Specifically, the CDFI Fund-FHFA working group will explore: approaches that increase non-depository CDFI members’ access to capital; property appraisal and collateral mechanisms and valuation methods; and, data sharing on CDFIs’ activities and performance.

Finally, while total funding available for our grant assistance programs will depend on final passage of the FY 2025 appropriations measure, recent award data as well as the CDFI Fund’s plans for moving forward with its upcoming funding rounds are highlighted below.

BEA Program. A total of 171 FDIC-insured institutions received $40.1 million in awards under the FY 2024 round of the program. The FY 2025 round of the program will open in early spring of CY 2025 with awards anticipated that fall. 

Capital Magnet Fund. For the FY 2024 round, 48 organizations received awards totaling more than $246 million. We anticipate the next round of the program will open in spring of CY 2025. Additionally, the CDFI Fund is currently soliciting comments on the Capital Magnet Fund Application, which are due November 25, 2024. The proposed revisions to the Application are informed by the program’s recently revised Interim Rules, as well as the updated Performance Report.

CDFI Bond Guarantee Program. The CDFI Fund issued three guarantees totaling $498 million under the FY 2024 round of the program, which is highest level ever in the history of the CDFI Bond Guarantee Program. The FY 2025 round is expected to open before the end of calendar year 2024.

CDFI Equitable Recovery Program. The CDFI Fund is hosting a series of six regional, in-person technical assistance workshops that will focus on the compliance and reporting requirements of the program. The first of these trainings took place in Los Angeles, CA on October 24-25, in conjunction with the 2024 Opportunity Finance Network Annual Conference. Additional workshop information will be released, soon.

CDFI Program & NACA Program. The CDFI Fund announced Financial Assistance (FA) awards under the FY 2024 round of these programs on September 26, 2024. A total of 357 CDFIs were awarded more than $408 million. Technical Assistance Awards will be announced before the end of this year, after which the CDFI Fund will pivot to opening the program early in CY 2025.

NMTC Program. A total of $5 billion in NMTCs was announced in September. The CDFI Fund is preparing to open the next round of the program that will make $10 billion in NMTCs available, combining allocation authority for CYs 2024 and 2025. The NMTC Program recently accepted comments on its Allocation Application which envisioned several changes, including that NMTC Program Applicants must be certified as Community Development Entities (CDEs) at the time the Notice of Allocation Availability is published in the Federal Register.

Small Dollar Loan Program (SDL Program). The next program round, the FY 2026 round, is expected to open in the fall of 2025 and will be supported by FYs 2025 and 2026 appropriations. Awards would be announced in the spring of 2026. To reduce the burden on prospective Applicants and to minimize overlapping with other CDFI Fund programs, the CDFI Fund anticipates that the SDL Program rounds will occur on a two-year cycle.

I would also like to call out that September marked the 30^th anniversary of the signing of the Riegle Community Development and Regulatory Improvement Act, which created the CDFI Fund. During the September meeting of the CDFI Fund’s Community Development Advisory Board, Treasury Secretary Janet Yellen reflected on the CDFI Fund’s decades of important work. Leading community development experts, policy makers and investors from across the nation also shared their outlook on challenges and opportunities within the larger CDFI industry. If you missed the meeting, a webcast is available on the CDFI Fund’s website. 

Sincerely,

Pravina Raghavan
CDFI Fund Director