PCDC joins the California Coalition for Community Investment (CCCI) – a coalition of almost 40 community development financial institutions that invest across the Golden State – in calling for a $1 billion appropriation for the U.S. Department of the Treasury’s Community Development Financial Institutions Fund (CDFI Fund) in the next federal COVID-19 stimulus package. The CDFI Fund enables lenders such as PCDC to invest in underserved and underinvested communities hardest hit by COVID19 and are most in need of primary care and other vital services.
CDFIs are dedicated to providing affordable capital to underserved communities, creating jobs, growing businesses and promoting the revitalization of local economies – and are uniquely positioned to help small, rural, minority and women-owned, and other underserved businesses access needed capital. Since these communities are already being disproportionately affected by the impacts of COVID-19, supporting the CDFI Fund is needed now more than ever.
Read the full letter below.
April 21, 2020
The Honorable Nancy Pelosi
Speaker of the House
H-232 The Capitol
Washington, D.C. 20510
The Honorable Maxine Waters
Chair, House Financial Services Committee
2221 Rayburn House Office Building
Washington, D.C. 20515
RE: SUPPORT – California CDFIs Support $1 Billion for the CDFI Fund in Phase 4 Relief Package
On behalf of 38 California Community Development Financial Institutions (CDFIs) we write to express our support for Chairwoman Waters’ recent proposal to include $1 billion for the CDFI Fund highlighted in her recent “Proposed Package 4 Related to COVID-19.”
The California Coalition for Community Investment (CCCI) is a coalition of almost 40 CDFIs doing business across the state. The coalition consists of affordable housing lenders, small business lenders, microlenders, credit unions and housing trust funds dedicated to supporting California’s most vulnerable communities. The mission is to provide these CDFIs appropriate resources to do what they do best.
CDFIs understand and can respond quickly to the needs of their consumers, housing developers and small business owners and are uniquely positioned to respond to relief and recovery during this crisis. CDFIs fill a vital gap in the nation’s financial services delivery system through their strong expertise and deep community relationships.
CDFIs have proven success addressing their communities’ needs during both natural and national disasters. During the Great Recession, when mainstream finance retracted lending, CDFIs kept capital flowing to businesses and communities. In 2017, when California was devastated by a series of wildfires in the North Bay and in Ventura County, CDFIs responded. In 2018, when the Camp Fire destroyed almost 19,000 homes, businesses and other structures, CDFIs responded.
In recent weeks, CDFIs have jumped into action by deferring loan payments, counseling small business owners in multiple languages, advising government officials and more.
The situation for California businesses is dire and borrowers are challenged with the harsh realities of closures, layoffs, downsizing, and uncertainty. Throughout the state, urban, rural and Native communities continue to struggle and CDFIs are on the frontlines using every resource available to provide critical access to credit to businesses, non-profits, healthcare facilities, housing developers and individuals impacted by the COVID-19 Crisis.
CDFIs need greater access to capital in order to effectively respond to the COVID-19 Crisis and this proposal is key step to getting economic relief into our communities that need immediate support. This institutional level capital is not readily available from other sources and is essential to allow CDFIs to continue to react quickly to the conditions in the communities we serve. As you are aware, this approach has been proven to work and is in line with the supplemental funding approved in 2009 through the American Recovery and Reinvestment Act, which allowed funding to be deployed quickly to CDFIs operating in low-wealth communities.
In addition to increasing the CDFI Fund budget, CDFIs should have delegated authority from the SBA to make PPP loans and be provided the funding to do so. When it comes to small business outreach, CDFIs have deep roots and inroads into minority and low-income communities. Any Federal Reserve resources should be extended to CDFIs and the communities they serve.
California CDFIs stand ready to utilize this funding swiftly and effectively. Thank you for your consideration and please contact Stan Keasling with any questions at email@example.com.
Members of the California Coalition for Community Investment:
Arcata Economic Development Corporation