WASHINGTON (2/3/15)--President Barack Obama Monday released his annual budget proposal for fiscal year 2016, estimated by the Office of Management and Budget to represent total federal spending at $3.999 trillion for the year. The Credit Union National Association has reviewed the document and noted line items for programs of interest to credit unions.
For instance, the National Credit Union Administration's Central Liquidity Facility (CLF) is authorized by statute to lend up to 12 times its paid-in capital. Under the Obama administration's proposed budget for fiscal 2016, and using NCUA data, this would allow the CLF to borrow up to $5.1 billion in FY2016. That is up from $2.9 billion in FY2015.
The 2016 budget proposes to keep funding for the Community Development Revolving Loan Fund (CDRLF) at $2 million, a repeat of the 2015 funding level.
It proposes an uptick in spending for the Community Development Financial Institutions Fund (CDFIF). If approved, $233.5 million in spending would be dedicated to this program. That is up from the FY2015 level of $230 million.
CUNA backs strong funding for these important programs because of the additional support credit unions can provide their members and communities through the grants, loans and equity investments. For instance, CUNA notes that CDFI-funded credit unions offer alternatives to predatory payday lenders and check-cashing services. They also promote economic revitalization and community development in distressed communities.
The CDRLF is administered by the NCUA and is used to support low-income designated credit unions in providing basic financial and related services to their members and their communities; enhancing their capacity to better serve their members and the communities in which they operate; and responding to emergencies. The CDRLF provides direct loans and project grants.
The CDFIF, under the U.S. Treasury Department's purview, makes capital grants, equity investments and awards for technical assistance to community development financial institutions, such as community development credit unions.