- Details
- By Brian Edwards
- Finance
The Trump administration has terminated the entire staff of the Treasury Department's Community Development Financial Institutions Fund, eliminating a federal office that provides critical capital to 69 Native-certified lenders serving tribal communities nationwide.
All CDFI Fund staff received reduction-in-force notices Friday, with terminations effective Dec. 13, according to email and text messages shared with Tribal Business News. The fund employed 102 full-time staff according to its most recent annual report. An administration official confirmed the terminations to the Daily Caller, marking the first time a federal agency has conducted mass terminations during a government shutdown in modern U.S. history.
The elimination threatens to cut off the only federal program designed specifically to support Native financial institutions operating in areas where traditional banks are scarce. A 2024 Federal Reserve Bank of Philadelphia study found 46% of Indian Country is considered a banking desert — 12 times the national rate.
The Native American CDFI Assistance program — often called the NACA program — has provided more than $221 million in support since 2001, generating over $1.6 billion in loans and investments across Native communities through 2021, according to Treasury data.
The decision comes despite bipartisan congressional support for the fund and follows months of the administration withholding appropriated funding.
The fund's closure caps a seven-month effort by the Trump administration to dismantle the program, beginning with a March 14 executive order directing the CDFI Fund to eliminate all “non-statutory components.” At that time, Treasury Secretary Scott Bessent pushed back, writing in a memo to the Office of Management and Budget that CDFI programs are mandated by law and cannot be abolished unilaterally through executive action.
However, OMB Director Russell Vought withheld $324 million — including $24 million for Native CDFIs — in fiscal 2025 funding appropriated by Congress. In July, 26 bipartisan senators — led by Sens. Mark Warner, D-Va., and Mike Crapo, R-Idaho — demanded the White House release the funds.
Treasury distributed $1.95 million in technical assistance grants to 10 Native CDFIs on Sept. 30, about half the $3.72 million awarded the previous year. The technical assistance awards support capacity building and training programs, while larger financial assistance awards that provide capital for lending in Native communities had yet to be distributed. The department said it expected to make those financial assistance awards later in the winter, but the staff terminations put that timeline in question.
Before the shutdown, the administration had already removed climate-focused financing from eligibility criteria and eliminated references to race or ethnicity as factors for receiving funds. Pete Upton, CEO of the nonprofit Native CDFI Network, said his organization has been meeting with congressional offices on both sides of the aisle since Friday and will continue advocating for the fund's protection through the organization's legislative day in Washington on Dec. 10.
Upton said the CDFI Fund staff terminations also threaten the Native 502 Relending Program, which Congress reaffirmed in the Senate's passage of the National Defense Authorization Act. The legislation authorized a $50 million annual set-aside under Section 502 of the Housing Act for Native CDFIs to expand homeownership across Indian Country.
“My foremost concern is for the Native communities we serve and how this decision could disrupt decades of progress in Native community and economic development,” Upton told Tribal Business News . “We have until December 13th to get to work — this is the time for Native CDFIs and Native organizations to stand together, stay focused, and fight for the future of our communities.
The administration has sent approximately 4,000 layoff notices across multiple federal agencies, according to news reports Saturday. Federal employee unions filed suit in late September seeking to block mass layoffs during the shutdown.
