Revitalizing American communities and industries has been a core priority for the Trump administration. Congress and federal agencies are pursuing policies aimed at increasing financial resilience and spurring economic growth with this priority in mind, while also providing relief to millions of Americans and Main Streets across the country.
In my former role as president of America’s Credit Unions, I saw a program with a proven track record of success accomplish this goal. It is the Treasury’s Community Development Financial Institutions Fund, which provides federal grants for projects that drive business development, job creation, affordable housing and financial literacy.
Across the country, 1,400-plus institutions in this program provide more than $300 billion in financial services each year, serving communities that struggle with these issues, from rural and Native American communities to low-income neighborhoods across the country.
Unfortunately, as part of the ongoing government shutdown and resulting reduction-in-force plans, the entire staff of the fund received notice their positions are being eliminated. This raises huge questions about the future of the fund and the future of nearly 500 participating credit unions.
Every Community Development Financial Institution Fund dollar granted to a credit union generates $12 in private investment. This has helped credit unions invest $85 billion in community mortgage lending, $91 billion in local consumer financing, $30 billion in lending to local businesses and $18 billion in affordable small dollar loans and alternatives to payday loans.
For example, Lake Trust Credit Union has issued $5 million in microloans in Michigan by treating small business funding as personal loans, which results in approvals in days rather than weeks. This investment allows local entrepreneurs to launch and scale businesses while supporting their community.
In Missouri, Alltru Credit Union embedded its no-cost Employee Wellness Benefits Program with two 30-employee firms: a STEAM-focused child care center and an in-home health-care agency. The program offers on-site credit-builder loans, fee-free Health Savings Accounts and small emergency lines, helping owners retain talent while giving workers the tools to steady household budgets.
St. Louis Community Credit Union used its certification as a Community Development Financial Institution to invest more than $40 million in loans. The credit union serves more than 52,000 members and has been able to bridge the gap between mission-driven institutions and local entrepreneurs, channeling resources in ways that improve household stability, generate jobs, and fuel economic development.
Support for the fund is bipartisan and bicameral. Last month, the Senate included a package of improvements to the fund in its passage of the National Defense Authorization Act.
This provision would increase congressional oversight of the fund, expanding a congressional and regulatory foundation to offer safe credit, small business finance, affordable housing and wealth building.
A recent bicameral effort led by Senate Finance Committee Chair Mike Crapo (R-Idaho) and Rep. Young Kim (R-Calif.) highlighted the impact of these financial institutions to the Treasury Department and Office of Management and Budget.
Government programs must be effective and cost efficient to protect taxpayers. The Community Development Financial Institution Fund is a nonpartisan program that meets these standards. With positive impact on communities, return on investment and strong bipartisan support, the fund’s dissolution is not the answer.
The fund works — it turns small amounts of federal dollars into truly impactful investments in communities. By preserving the fund, Congress will ensure it can meet its statutory mission once the shutdown ends.
We urge the administration to examine how the fund can support its priorities in financial resilience and economic growth, and, through this program, allow credit unions to continue unleashing domestic economic opportunity in communities across America.
Jim Nussle is the former president and CEO of America’s Credit Unions.
