On July 26, the House Appropriations Financial Services and General Government (FSGG) Subcommittee held a hearing where U.S. Secretary of the Treasury Steven Mnuchin testified on the administration’s FY18 budget proposal.
During the hearing, two members of Congress made statements in support of the CDFI Fund:
- Sen. Chris Coons (D-DE), Ranking Member, Senate FSGG Subcommittee
- Sen. Chris Van Hollen (D-MD), Member, Senate FSGG Subcommittee
Their statements (see below) highlighted the impact of CDFIs in their home states and nationwide and why funding for the CDFI Fund should be preserved. Ranking Member Coons also questioned Secretary Mnuchin on the proposed zeroing out of funding for the CDFI Fund in the Administration’s FY18 budget proposal and whether Treasury would continue to use all the funds available to the CDFI Fund for the remainder of FY17. Secretary Mnuchin affirmed that Treasury would follow congressional intent and use all the funds allocated to the CDFI Fund for FY17.
OFN sent thank you tweets to the senators for their support of the CDFI Fund during the hearing. If your CDFIs lend in their state, make sure that they also hear from you! You can send them a tweet, call their office, or send an email.
Highlights from the hearing included:
Sen. Coons’ statement and questions
“Let me move to the Community Development Financial Institution, CDFIs. The fund that supports them has strong bipartisan support because CDFIs have a record of creating jobs in under-served communities. They leverage federal funds, roughly 12 to 1 in the last oversight analysis, investing about $3 billion a year. That's why last year's appropriations bill increased their funding 6 percent. But the FY18 budget proposes to eliminate them.
[Secretary Mnuchin] Would you commit to following congressional intent and fully utilizing all the funds that we provided in the FY17 appropriations? And help me understand why you would eliminate a program with a proven record of economic growth. Was this making tough choices in the context of a difficult budget environment, or do you think they actually should not be funded?”
Treasury Secretary Mnuchin’s response
“This was, as I mentioned, in the context of making difficult choices. So, I--I do agree that CDFIs have played an important role in the community. This was merely a function of us making difficult decisions across.
Now, the one thing I would also add, that when we came out with our recommendation on financial reforms, one of the areas that I recommended that we look at is the Community Reinvestment Act. So, one of the things we want to make sure is as banks are dedicating significant money under the CRA, that it's being used appropriately. And we want to make sure we meet with community groups and advocates, because that's a big area of investment that we think can be more effective.”
Sen. Van Hollen’s statement
“I want to reinforce the comments that Senator Coons made, regarding CDFIs. I was pleased to hear that that was not a cut made on the merits, but it just didn't--I guess it just didn't meet your overall priority list in the budget. I would say, in Maryland--I think, many communities around the country, CDFIs have played a really important role in local economic development. So, I hope this committee will work to restore those cuts.”
Presently, the Senate FY18 FSGG Appropriations bill has yet to be released and will most likely be released after the August congressional recess. Once released, we expect a swift markup of the Senate FSGG Appropriations bill in September since the fiscal year will conclude at the end of the month.
OFN remains committed to advocating for $250 million in funding for the CDFI Fund in FY18. OFN will continue to engage our network in advocacy efforts to tell Congress why funding for the CDFI Fund must be preserved.