Administration's Latest Budget Funds Community Development Financial Institutions Fund

WASHINGTON — The Bush Administration has broken with its prior policy and has sought an appropriation for the U.S. Treasury Department’s Community Development Financial Institutions Fund. In previous years the Administration has sought to eliminate the program, but in the budget for fiscal year 2008 the administration sought $29 million for the Fund.

The money would be spent on Administration ($12 million), Financial Assistance ($15 million) and Technical Assistance ($2 million), the Administration said. The CDFI Coalition, an organization of financial institutions that supports the Fund, praised the Administration for not seeking to eliminate the Fund, but pointed out that $29 million is not enough. “While the President did acknowledge the value of CDFIs in the budget proposal, $29 million is woefully insufficient funding and would limit the work of CDFIs nationwide,” the Coalition said. “The CDFI Coalition is opposed to the cut of CDFI Fund grant programs.” The Coalition argued that CDFI Fund grant programs have worked well for the CDFI industry–enabling CDFIs to expand the availability of credit, capital and financial services to hundreds of distressed communities across the country.