Treasury Guarantees $498 million in Bond Funding for Projects in Low-Income Communities
Thursday, October 11, 2024
Announcement Marks Largest Bond Issuance in Program’s History
Washington, DC - U.S. Department of the Treasury’s Community Development Financial Institutions Fund (CDFI Fund) announced today that Treasury has agreed to issue three guarantees totaling $498 million under the Community Development Financial Institution (CDFI) Bond Guarantee Program. The guarantees will be issued on behalf of ten Eligible CDFIs under the fiscal year (FY) 2024 round of the program. A total of nearly $3 billion has been guaranteed since the inception of the CDFI Bond Guarantee Program, which provides long-term, fixed-rate capital for projects in low-income urban, rural, and Native communities.
“Today’s announcement marks a banner year for the CDFI Bond Guarantee Program,” said CDFI Fund Director Pravina Raghavan. “The $498 million in bond issuances announced today is the largest in the program’s history. Today is also a good point in time to reflect on the significant impact this important source of long-term capital has in our nation’s low-income communities – of the nearly $3 billion approved, more than $1.7 billion in cumulative investments have already been disbursed through this program since its launch in 2013.”
The FY 2024 program participants include:
Opportunity Finance Network will issue $173 million in bonds on behalf of the following seven Eligible CDFIs:
- Renaissance Community Loan Fund, Inc. (RCLF) will receive a $20 million bond loan to fund owner occupied homes in Mississippi and Alabama. RCLF is headquartered in Gulfport, MS, and is a first-time participant in the BG Program.
- Greater Minnesota Housing Fund (GMHF) will receive a $25 million bond loan to finance rental housing within the state of Minnesota. GMHF’s home office is in Saint Paul, MN. GMHF has received three prior bond guarantees in 2017, 2019, and 2022.
- Community Loan Fund New Jersey (LFNJ) will receive a $33 million bond loan to fund charter schools, commercial real estate, daycare centers, not-for-profit organizations, rental housing, and small businesses mainly within the state of New Jersey and 37 other states. LFNJ is headquartered in New Brunswick, NJ. LFNJ has received two prior bond loans in 2015 and 2019.
- Florida Community Loan Fund (FCLF) will receive a $30 million bond loan to fund commercial real estate, healthcare facilities, not-for-profit organizations, and rental housing within the state of Florida. FCLF is headquartered in Orlando, FL, and received one prior bond loan in 2017.
- Homewise (HMWS) will receive a $15 million bond loan to fund commercial real estate and owner-occupied homes within the state of New Mexico, primarily Santa Fe and Albuquerque. HMWS is headquartered in Santa Fe, NM, and received one prior bond loan in 2017.
- Community First Fund (CFF) will receive a $20 million bond loan to fund commercial real estate, daycare centers, not-for-profit organizations, owner-occupied homes, rental housing, and small businesses within the State of Pennsylvania. CFF is headquartered in Lancaster, PA, and received one prior bond loan in 2017.
- Nonprofit Finance Fund (NFF) will receive a $30 million bond loan to fund charter schools, commercial real estate, healthcare facilities, not-for-profit facilities, rental housing, and small businesses. NFF is headquartered in New York, NY with geographic presence in New York, Philadelphia, Los Angeles, Boston, and Oakland. NFF is a first time applicant to the BG Program.
Community Reinvestment Fund, USA (CRF) will issue a $150 million bond on behalf of The Community Development Trust (CDT). CDT plans to use the bond proceeds to fund charter schools and rental housing throughout the United States. CDT’s home office is in New York, NY, and has received one prior bond issue in 2013.
CRF will also issue $175 million in bonds on behalf of the following two Eligible CDFIs:
- The Reinvestment Fund (TRF) will receive a $100 million bond loan to fund charter schools, commercial real estate, daycare centers, healthcare facilities, rental housing, not-for-profit organizations, and small businesses in Philadelphia, Atlanta, and Baltimore. TRF is headquartered in Philadelphia, PA. TRF has received two prior bond issues in 2014 and 2016.
- IFF will receive a $75 million bond loan to fund charter schools, commercial real estate, daycare centers, healthcare facilities, rental housing, not-for-profit organizations, and small businesses in Illinois, Indiana, Iowa, Kansas, Kentucky, Michigan, Minnesota, Missouri, Ohio, and Wisconsin. IFF is headquartered in Chicago, Il, and has received one prior bond issue in 2014.
Established by the Small Business Jobs Act of 2010, the CDFI Bond Guarantee Program responds to a critical market need—low-cost, long-term capital to spur economic growth and jump start community revitalization. Under the program, Qualified Issuers (CDFIs or their designees) apply to the CDFI Fund for authorization to issue guaranteed bonds worth a minimum of $100 million in total. The bonds provide CDFIs with access to substantial long-term, fixed-rate capital to reignite the economies of distressed communities.
The program enables CDFIs to execute large-scale projects, including the development of commercial real estate, housing units, charter schools, daycare or healthcare centers, and rural infrastructure projects, among other asset classes. As of July 31, 2024, more than $1.7 billion in bond proceeds has been disbursed in 32 states and the District of Columbia.