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The recently released Recission Package by the Trump Administration would claw back federal funds previously approved by Congress that promote private investment in low-income communities. The package freezes the release of over $15 billion in funding already appropriated in the FY2017 budget, including $22.8 million in funding for the U.S. Treasury's Bank Enterprise Award (BEA) Program and $151.3 million for the Capital Magnet Fund (CMF). “The elimination of the BEA Awards would curtail these initiatives, and have a detrimental effect on the economic stability of the regions they serve,” said Jeannine Jacokes, CEO of the Community Development Bankers Association.
This week, President Trump sent a rescission package proposal to Congress that calls for stripping more than $15 billion in previously approved spending, including funding for the CDFI Fund's Bank Enterprise Awards and Capital Magnet Fund Programs. Click here to read the CDBA press release. These programs provide incentives for banks to lend and invest in high-poverty and high-unemployment communities. They have played a crucial role in increasing the flow of capital to distressed areas and stimulating exponential private investment in CDFIs, thereby accelerating business growth, generating jobs, revitalizing neighborhoods, increasing the availability and affordability of housing, and improving access to financial services in communities that have been left behind. Congress has 45 days to either approve or dismiss the proposed rescissions.
The Harbor Bank of Maryland Community Development Corporation dedicated the Joseph Haskins, Jr. Center for Community and Economic Development on Thursday. The center, named for the bank’s founder, chairman, president and CEO, will offer several programs designed to address Baltimore entrepreneurs’ need for access to financial and social capital, as well as technical assistance, to help them grow. It also will provide entrepreneurs low-cost office space and access to resources, networks and other amenities. While the center serves all Baltimore communities, it will emphasize job creation in disinvested and low- to moderate-income areas.
The Harbor Bank of Maryland Community Development Corp. has dedicated the Joseph Haskins, Jr. Center for Community and Economic Development. The center, located at the bank's headquarters, will offer several programs designed to address altimore entrepreneurs' need for access to financial and social capital, as well as technical assistance, to help them grow. It also offers entrepreneurs low-cost office space and access to resources, networks, and other amenities. The center is already fully leased by entrepreneurial groups eager to benefit from these resources.
Carver Federal Savings Bank hosted a grand re-opening celebration with a ribbon-cutting ceremony at its Crown Heights location in Brooklyn, New York on April 19. Congresswoman Yvette Clarke (D-NY) was present at the ceremony. Completing the festivities, The new branch manager, on behalf of the bank, presented a $20,000 check to Wilchfort to benefit the Childrens' Museum. The 70-year-old minority-owned bank now has nine full-service branches in Brooklyn, Queens, and Manhattan.
Virginia Community Capital has received a $1.5 million investment from Robins Foundation, a private family foundation with a 60-year history of leading transformational change in the greater Richmond region through innovative philanthropy. The investment will be directed toward development of affordable housing and projects that support a better quality of life for residents. The commitment includes directing $1.25 million into a LION Note (Local Impact Opportunity Note) with VCC and opening a $250,000 impact deposit account with its banking subsidiary, VCC Bank. “Robins and other institutions are leading innovative investment strategies to positively impact their communities,” said Jane Henderson, CEO of VCC. “Combining impact investing and philanthropy to tackle economic challenges in this region is groundbreaking, and Robins is demonstrating how to leverage the full range of foundation assets for greater community impact.”
American Samoa is finally getting its own full-service bank, and successfully creating only the second public bank in the United States. The Federal Reserve is allowing the Territorial Bank of American Samoa access to the U.S. payments system nearly two years after the bank applied. The decision is a boon to the remote U.S. territory in the South Pacific, where more than half of the households are at, near or below the federal poverty level. It is also a significant development for those far away from American Samoa. The chartering of a new public bank may provide momentum for similar efforts elsewhere. The only still operating public bank in the U.S., the Bank of North Dakota, was created a century ago. States like New Jersey and cities like Seattle and San Francisco are receptive to the idea of forming new public banks as a way to help the local economy.
A new report shows that despite strong job growth since the end of the Great Recession, many working families are worse off that they were in 2007, before the Great Recession began. The latest U.S. Census data shows that three out of every 10 working families were low-income in 2016. In addition, income and wealth gaps between working families at the top and bottom of the economic ladder remain at all-time highs. The report, produced jointly by PRB and The Working Poor Families Project, also found disturbing growing inequality among racial and ethnic groups.
Bloomington, Indiana has introduced itself as the first "CDFI Friendly City", in hopes of establishing a new model to bring national financing to local community development. CDFIs, which serve neighborhoods or groups the financial sector has historically neglected, have expanded in recent years but still aren't reaching many American cities. "More than a quarter of counties in the U.S. have had no CDFI lending in the five years between 2011 and 2015," says Brett Theodos, a principal research associate at the Urban Institute who studies on CDFIs. In December 2017, the Urban Institute released a report breaking down the types of state and local policy that are important for CDFIs to enter a market. There are significant challenges for smaller communities and more rural areas, according to Theodos.
Recently, several large banks have been called out for discriminatory lending practices, including not serving low income areas. For many of those residents, banking services offering personal bank accounts and loans for homes and small businesses, can be difficult to access. But some banks, like Industrial Bank, have made their focus serving those communities. This radio segment explores what it means to live in a "banking desert." Jacquie Boles, Senior Vice President at Industrial Bank, contributes.