League Thanks Sen. Warner, Colleagues for Reintroducing Bill to Boost Economic Growth in Underserved, Low-Income Communities

The League penned a letter of thanks to Sen. Mark Warner for reintroducing legislation to create the Community Development Financial
Investment Tax Credit.

Warner (D-VA) joined by Sens. Roger Wicker (R-MS), Chris Van Hollen (D-MD), Cindy Hyde-Smith (R-MS), Gary Peters (D-MI), and Jerry Moran (R-KS), on the legislation designed to promote lasting economic prosperity in low-income, minority, and rural communities. The Community Development Investment Tax Credit would help unlock more equity and long-term financial capital for community development financial institutions (CDFIs). CDFIs often serve as a backbone for underserved communities, including small and disadvantaged businesses, which tend to have fewer banking relationships and less access to credit.

“Virginia’s CDFI credit unions play a critical role in their communities, leveraging private capital sources to help small businesses and create economic opportunity," reads the letter. "CDFI credit unions are on the front lines providing essential financial services to underserved
communities."

Your League supports efforts to aid CDFIs. We worked during this past session of the General Assembly to win passage and enactment of a measure that codifies the Virginia Community Development Financial Institutions (CDFI) Fund. We worked closely with member credit unions and others to host a CDFI awareness event last February that drew key lawmakers and Lt. Gov. Winsome Earle-Sears.

CDFIs are specialized community-based financial institutions with a primary mission to promote economic development by providing financial products and services to people and communities underserved by traditional financial institutions, particularly in low-income communities. In addition to community development credit unions and banks, CDFIs can also be non-regulated institutions such as non-profit loan funds or venture capital funds. Virginia has 22 Community Development Financial Institutions (CDFIs), including six credit unions.

In 2021, the Virginia General Assembly passed a $10 million budget amendment that established and funded the VA CDFI Fund, to be administered by the Virginia Department of Housing and Community Development (DHCD). The purpose of this fund is to support Virginia-based Community Development Financial Institutions (CDFIs) and build their capacity to support communities and businesses across the state. VCDC’s lending affiliate, VCDF, collaborated with a group of CDFIs to form the Virginia CDFI Coalition, which, among other things, is actively involved with the state agencies responsible for deploying the fund.