Washington: The U.S. Department of the Treasury’s Community Development Financial Institutions Fund (CDFI Fund) announced today that an additional nine bond loans, totaling $327 million, were guaranteed in fiscal year (FY) 2015, bringing the total guaranteed to date to $852 million. All of the bond proceeds, provided through the Community Development Financial Institutions Bond Guarantee Program (CDFI Bond Guarantee Program), will provide long-term, fixed rate capital for projects in low-income and underserved communities.
“I am very pleased to recognize the CDFIs that are creating new partnerships and innovative ways to fully utilize the CDFI Bond Guarantee Program,” said CDFI Fund Director Annie Donovan. “The program is reaching diverse organizations and communities across the country, allowing us to greatly expand access to financing for low-income areas nationwide.”
The CDFIs that participate in the CDFI Bond Guarantee Program are at the cutting edge of community development finance. The FY 2015 program participants share an equal commitment to financing a wide range of job-creating and community-building projects in urban, rural, and Native American communities.
Three Bonds were issued on behalf of 9 Eligible CDFIs as follows:
• Community Reinvestment Fund, USA issued a $100 million bond on behalf of Raza Development Fund. Raza Development Fund is headquartered in Phoenix, Arizona and is the largest CDFI serving the Latino population on a national basis. Raza Development Fund plans to finance senior living and long-term care facilities, daycare centers, healthcare facilities, rental housing, not-for-profit organizations, and charter schools.
• Opportunity Finance Network issued a $100 million bond on behalf of Clearinghouse CDFI. Clearinghouse CDFI is headquartered in Lake Forest, California and is the first non-depository CDFI to receive a public rating from Standard and Poor’s. Originally approved in FY 2013, Clearinghouse CDFI is the first entity to receive multiple bond loans under the program. Clearinghouse CDFI has expanded its lending from California to Arizona and Native American communities, and will continue to serve the rental housing and commercial real estate market.
• Opportunity Finance Network also issued a $127 million bond on behalf of seven Eligible CDFIs serving urban, rural, and Native American communities in the most diverse application approved thus far in the CDFI Bond Guarantee Program. This bond issue includes the following CDFIs:
• Bridgeway Capital, headquartered in Pittsburgh, Pennsylvania, will provide financing to small businesses, commercial real estate, and not-for-profit organizations in Western Pennsylvania using its $15 million bond loan.
• Chicago Community Loan Fund, headquartered in Chicago, Illinois, will provide financing to commercial real estate, rental housing, not-for-profit organizations, and charter schools in low-income and underserved areas in Chicago using its $28 million bond loan.
• Citizens Potawatomi Community Development Corporation, headquartered in Shawnee, Oklahoma, is the first Native CDFI to participate in the CDFI Bond Guarantee Program and will provide financing for large scale commercial real estate projects in the Citizens Potawatomi Nation using its $16 million bond loan.
• Community Loan Fund of New Jersey, headquartered in New Brunswick, New Jersey, will provide financing for rental housing and charter schools in low-income and underserved areas in New Jersey using its $28 million bond loan.
• Community Ventures Corporation, headquartered in Lexington, Kentucky, will provide financing to small business and commercial real estate in Kentucky using its $15 million bond loan.
• Federation of Appalachian Housing Enterprises, headquartered in Berea, Kentucky, will provide financing for rental housing in the greater Appalachian region using its $15 million bond loan.
• Kentucky Highlands Investment Corporation, headquartered in London, Kentucky, will provide financing to small businesses and commercial real estate in Kentucky using its $10 million bond loan.
The CDFI Bond Guarantee Program was created through the enactment of the Small Business Jobs Act of 2010. In the three rounds of the CDFI Bond Guarantee Program completed to date, Treasury has guaranteed bonds for $852 million dollars for investment in the nation’s most underserved rural and urban areas. While participants are allowed up to five years to fully deploy bond loan funds, it’s anticipated that borrowers in the FY 2015 round will completely commit their capital to community development projects by the end of calendar year 2018. This means new jobs, new community and neighborhood facilities, and enhanced economic opportunities for Americans who need it most.
The CDFI Bond Guarantee Program was extended until September 30, 2015. The President’s Fiscal Year 2016 budget proposes to extend the program, subject to reauthorization by Congress.
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