Cliff Rosenthal's thoughtful letter (CU Times, July 5) regarding the Community Development Revolving Loan Fund suggested NCUA could do more for low-income credit unions by allowing funds to be used for secondary capital investments. While we share Mr. Rosenthal's enthusiasm for full and active use of the Fund, NCUA is restricted in its use of appropriated funds to technical assistance grants and loans. It is our view that secondary capital investments do not fit into either category, and as a result NCUA is not authorized to use appropriated funds in this manner.

Credit unions that avail themselves of the benefits of the Community Development Revolving Loan Fund have done, and continue to do, exceptional things. Whether it's the Montana credit union that used funds to provide an elderly member with a $50 loan for immediate living expenses when the member's social security check was delayed, or a Missouri credit union that was able to provide a loan to a member who had lost his home to a disreputable lender, the CDRLF is a vibrant participant in the overall efforts of credit unions to make a real difference in the financial lives of their members.

Low-income designated credit unions (LICUs) are eligible to borrow up to $300,000 at the low interest rate of 1% over a period of five years. We have made great efforts to streamline the process and make the funds attractive to LICUs. During the first half of 2006, we approved $1.9 million in loans, exceeding the aggregate loans granted in 2005 by $300,000. In fact, we have not denied a loan in 2006, and only denied one loan in 2005. Since the inception of the Fund in 1979, we approved 265 loans totaling $39 million and 1,800 grants totaling $5.4 million.