FY18 budget proposal zeroes funds, makes changes to CFPB
President Donald Trump’s proposed fiscal year 2018 budget, released Tuesday, zeroes out 2 crucial credit union funds, the Treasury’s Community Development Financial Institutions (CDFI) Fund and NCUA’s Community Development Revolving Loan Fund (CDRLF). CUNA and credit unions successfully fought to restore fiscal year 2017 CDFI funding, and CUNA remains committed to seeing full funding in fiscal year 2018 and beyond.
“Congress heard CUNA, leagues and credit unions earlier this year when they called for CDFI funding, and continuing that momentum is essential as Congress works toward a funding deal for the next fiscal year,” said CUNA President/CEO Jim Nussle. “Our grassroots efforts clearly demonstrated that investing in CDFIs is sound public policy, so we need to stay on the offensive to make sure our priorities stay top of mind.”
The proposed budget also includes a restructuring of the Consumer Financial Protection Bureau (CFPB) and transitioning it to a place where it will operate under Congressional oversight and its appropriations process starting in fiscal year 2019.
CUNA strongly supports this concept, as long as the funding mechanism doesn’t result in credit unions and banks paying more than they already do for federal financial institution examinations.
The CDFI Fund makes capital grants, equity investments and awards for technical assistance to CDFIs to finance community development initiatives such as small businesses, community facilities, and low-income housing.
As of March 31, there are 297 credit unions among 1,094 certified CDFIs.
The CDRLF funds a revolving loan program and a technical assistance program for small credit unions to offer services like free income tax preparation and financial literacy classes.
CUNA is concerned that an elimination of this fund will result in fewer low-income credit unions having access to needed capital to provide critical services to low income credit union members.
CUNA is satisfied with the proposed funding levels for the Small Business Administration’s 7(a) and 504 loan programs, proposed for $29 billion and $7.5 billion respectively.
A detailed summary of the President’s revenue proposals will be released later by the Treasury.