House passes bill providing CDFI program with $303 million for FY20

The bill also provides $2 million for the National Credit Union Administration’s Community Development Revolving Loan Fund for the 2020 fiscal year.

The House on Thursday passed an FY20 Financial Services appropriations bill that would provide $303 million for the Community Development Financial Institutions program.

Voting 224-196, the House passed the bill, which also sets aside $1 million to support the Postal Service in expanding “nonbank financial services.”

CUNA officials said that as of June 14, credit unions made up 274 of the 1,061 CDFIs across the country.

The House bill also would provide $2 million for NCUA’s Community Development Revolving Loan Fund for fiscal year 2020.

The Senate has not yet considered its version of the bill.

The House vote came, as the Trump Administration issued another veto threat for the measure, citing several provisions administration officials do not like, including funding for the CDFI program.

“The Federal Government should not be allocating taxpayer funds to the mature CDFI industry, which should have ready access to private capital,” the Office of Management and Budget said in a “Statement of Administration Policy.”

OMB said that $14 million is enough to support ongoing activities in the CDFI program.

Democrats disagreed.

“The administration has proposed to eliminate the Community Development Financial Institutions Fund, risking the public-private investments that are generating economic growth in places like my district in the South Bronx,” Rep. Jose Serrano (D-N.Y.) said.

The House Appropriations Committee had provided $300 million for the CDFI program—a 20% boost over current funding.

On the floor, the House approved two amendments—one would provide $2 million for CDFI efforts to assist individuals with disabilities and one would provide an additional $1 million to the program’s Healthy Food Initiative.

That initiative is intended to encourage community development financial institutions to invest in businesses that provide healthy food options. CUNA officials said they were pleased with the funding level.

“We thank the House for passing the bill, and for the attention of House appropriators to ensure appropriate levels for several important funds that credit unions are able to leverage to better serve their members and communities,” said CUNA President/CEO Jim Nussle.

The postal amendment would provide $1 million to support the Postal Service to expand its nonbank financial services to the fullest extent allowed under law in an effort to serve the needs of the people who cannot access traditional banking services.

Credit union trade groups vehemently oppose postal banking, contending that federal law should be changed to allow credit unions to serve more people who cannot access those services.

Source: Credit Union Times