CFDI Oversight Legislation Introduced, Credit Union Industry in Full Support
Proposed changes include an annual testimony from the U.S. Treasury in front of the House and Senate committees.
Representatives from Tennessee and Colorado introduced bipartisan legislation Tuesday to provide more transparency to the Community Development Financial Institutions (CDFI) Fund. The bill, from Reps. John Rose (R-Tenn.) and Brittany Pettersen (D-Colo.), has the full backing of officials from NAFCU and CUNA.
According to a statement from CUNA, the association is pleased the bill includes the following items:
- Requires an annual testimony, at the discretion of the chair, before the House Financial Services Committee and the Senate Banking, Housing, and Urban Affairs Committee.
- Provides further discretion to the chair to convene such a hearing at the subcommittee level or full committee level.
- Requires the Treasury Secretary, or their designee, to appear before the hearing.
In a May 8 letter to the representatives, CUNA President/CEO Jim Nussle wrote, “The CDFI Fund Transparency Act would provide Congress with the ability to gather information and conduct better oversight of the activities and operations of the Community Financial Development Institutions Fund within the U.S. Department of the Treasury.
“We have long been a champion of the CDFI Fund and its mission to expand economic opportunity to underserved persons and communities. Increased transparency into the CDFI Fund would ensure all entities – both the government and financial service providers – remain focused on that mission. This bill enables Congress to require annual testimony from Treasury on the CDFI Fund’s operations and activities, while appropriately balancing the burden of this oversight on the Fund,” Nussle wrote.
Similarly, NAFCU Vice President of Legislative Affairs Brad Thaler’s letter to the lawmakers pointed out how beneficial the CDFI Fund has been to the nearly 500 credit unions that are CDFI certified.
“Unfortunately, recent actions by the CDFI Fund have made it difficult for institutions to complete their required annual recertification, and the Fund has been in a months-long blackout period in which it is not accepting new applications at all,” Thaler wrote. “These steps have made it more difficult for financial institutions to fully support the communities the CDFI Fund is intended to help. The CDFI Fund Transparency Act will promote oversight and help enable Congress to ensure the Fund is carrying out its intended mission to help low-income and underserved communities. We urge swift passage of your legislation.”
The CDFI Fund has been on pause for accepting new applications since October 2022. The new CDFI Certification Application process was scheduled to roll out April 3, but remains in a blackout period. A recent update from the CDFI Fund stated the blackout period is set to be lifted in the fall of 2023.