- By Elyse Wild
- Economic Development
The awards are part of a $1.73 billion dispersal from the U.S. Department of the Treasury CDFI Fund to 603 CDFIS through the CDFI Equitable Recovery Program (CDFI ERP) — the largest award in the fund’s 29-year history.
According to a statement from the CDFI Fund, the awards will leverage CDFI’s ability to help low-and moderate-income communities recover from the COVID-19 pandemic by expanding lending, grantmaking and investment activities.
Native American communities experienced the highest rates of COVID-19 mortality of any race, according to a report by Princeton University. Persistent poverty, geographic isolation, and sporadic amenities like water and electricity created a pathway for the virus to ravage Native reservations.
The $47 million is nearly triple the funding Native CDFIs receive annually from the Native American CDFI Assistance (NACA awards). The 2022 NACA awards — which were delayed six months and announced this March — saw $17 million deployed to 19 Native CDFIs.
Native CDFI Network CEO Pete Upton said the ERP Awards is a sign for Native CDFIs to take advantage of the numerous awards offered through the CDFI Fund.
“In the scheme of things, there are so many opportunities out there for Native CDFIs to compete in, whether it’s this ERP fund or others,” Upton said. “I think the message to Native CDFIs is that you need to be active and competitive in applying for funds.”
The 29 awards for Native CDFIs range from $6.1 million to $500,000.
Among those is Little Canada, Minn.-based Indian Land Capital Company (ILCC), which provides alternative loan options to Native Nations for tribal land acquisition and economic development projects. According to the award announcement, ILCC received $3.6 million.
ILCC CEO Rjay Brunkow said the ERP award paired with a $1.5 million NACA award, is a direct boost to the company’s equity.
“We always look to leverage our equity by a factor of four,” Brunkow told Tribal Business News. “When you take that into consideration, that $5 million represents $25 million for Indian Country.”
As well, Four Bands Community Fund in Eagle Butte, S.D., received a $1.5 million ERP award. The fund averages 150 loans a year, including approximately 80 small business loans. Four Bands Executive Director Lakota Vogel said the award will help the CDFI unclog an existing $8 million it has been unable to meet.
“We will quickly use up that amount of capital on lending out to small businesses and mortgage lending,” Vogel said. “I think CDFIs are having record year of lending with the interest rate market as it is. There is just tons and tons of demand, and we’re very excited to have that amount of capital available to push back out.”
The ERP grant award comes amid proposed changes to the CDFI certification process, which, if made, would drastically alter the services of Native CDFIs. The proposed changes were originally set to roll out this month; however, the Treasury announced earlier this year that it would delay the rollout to carefully consider the high volume of public comments it received regarding the potential changes.
Despite the concerns Native CDFIs have over the looming certifications changes, Upton says he is pleased with the Treasury’s efforts to meet the substantial economic needs of Indian Country.
“I know at times people get frustrated, but I do think Treasury has done an exceptional job and getting all the money out of the door,” Upton said. “I have to give them credit for all of the programs they have rolled out.”