Another round of grants, drawing from the CDFI Fund's regular yearly appropriation, will be announced in the fall. These are expected to be worth roughly $50 million.

Even though the National Federation of Community Development Credit Unions was not among the award recipients in the most recent round, CEO Cliff Rosenthal expressed overall satisfaction with them.

"We are delighted with the strong showing our member CDCUs made in this awards round," said Rosenthal. "They are some of our most dynamic, innovative institutions, and we know they will continue to make a huge difference for the low-income communities they serve."

Rosenthal said he believed that institutions, including the National Federation, that did not received any CDFI money from this round were still eligible for the next funding round, which is tentatively scheduled for September. The CDFI Fund had not returned calls for comment as of press time.

The nine CDCU winners represent 30% of the 30 credit unions that applied, a percentage that Rosenthal indicated was significantly higher than normal. The $17.15 million they received amounted to 40% of the total dollars requested by credit unions.

"We would always like to see a larger credit union share, of course," said Rosenthal, "but these percentages are a marked improvement over recent CDCU performance in previous award rounds. Given the stress on the credit union industry, the CDFI Fund's investments could not come at a better time."

Interviews with several executives from the award-winning credit unions confirmed Rosenthal's comments. Almost all of them reported they would use the CDFI money to strengthen their capital positions, particularly in the light of the ongoing uncertainty about the final cost of the corporate stabilization effort.

"We are going to use the money to strengthen our allowance for loan losses and are exploring ways of using it as a contingency against what might happen with the corporate program," explained Samira Rajan, director of lending for the $8 million Brooklyn Cooperative Credit Union. Rajan described the lack of definition over what the corporate stabilization program might cost in the future as a source of "regulatory instability" that the CU had to plan for.

The $298 million ASI Federal Credit Union, headquartered in Harahan, La., near New Orleans, will also use the money to strengthen its allowance for loan losses, particularly as it seeks to help its members struggling under predatory loans from other institutions, explained CEO Mignhon Tourn?.

"We offer all sorts of consumer loans that are meant to help our members get out of the terms of some of their other loans, which are really dragging them down," Tourn? said.

The credit union wants to help them out with fixed-rate consumer loans, Tourn? said, and those sorts of loans are high risk. "So our reserve for loan losses has to rise," she explained.

One CU, the $56 million Alternatives Federal Credit Union, reported that some of its money would go for a mobile branch to supplement the CU's one current branch, according to Deirdre Silverman, director of community programs for alternatives. The Ithaca, N.Y.-based CU also plans to strengthen its loan reserves and build on its financial counseling programs.

Richard Cooper, CEO of the $88 million Mendo Lake Credit Union, headquartered in Ukiah, Calif., said the money would support the credit union's capital and allow it to help more of the growing numbers of low-income people.

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