On Wednesday, as Vice President Joe Biden hosts local officials from across the country at the White House to discuss how funding from the American Recovery and Reinvestment Act (Recovery Act) will support new economic growth in their communities, the Treasury Department’s ""Community Development Financial Institutions"":http://www.cdfifund.gov/ (CDFI) Fund is releasing its ""implementation plan"":http://www.cdfifund.gov/recovery/implementationplan.pdf to award nearly $100 million in grants and $3 billion in additional tax credit authority to support community-based financial institutions.
The Treasury Department said these awards, made available through the Recovery Act, will support loan funds, credit unions, banks, venture capital firms, and other financing entities in helping some of the nation's most under-served populations and communities realize economic improvements.
Treasury Secretary Timothy Geithner commented, ""The Recovery Act is enabling more funds to flow to these community-based lenders that are responsibly providing financing to help small businesses, creating needed jobs, and saving homes in low-income areas across the country that have been hit hard by this economic crisis.""
As part of the administration's effort to swiftly implement the Recovery Act agenda and get money to businesses and communities rapidly in this time of economic crisis, the Treasury said the CDFI Fund will award the entirety of the Recovery Act allocation in less than 90 days and will begin disbursing the money within 120 days.
The CDFI Fund will be reopening its 2009 award rounds to enable community agencies to apply for the new $100 million in grant funding and will also allow current applicants to request larger awards. Applicants that have already applied for grants under the initial FY 2009 award rounds can increase their petitions to as much as $2 million under the CDFI Program and $750,000 under the Native American CDFI Assistance (NACA) Program. To provide additional aid, the Recovery Act includes a waiver of the program’s matching funds requirement for new grants awarded.
The CDFI Fund estimates that the grants made this year under its program will create or maintain thousands of jobs, helping to promote economic opportunity and growth in disadvantaged communities.
The Recovery Act also authorizes the CDFI Fund to allocate $3 billion of tax credit authority to qualified community development entities under the ""New Markets Tax Credit"":http://www.cdfifund.gov/what_we_do/programs_id.aspxprogramID=5 (NMTC) program, with $1.5 billion going to applicants of the 2008 NMTC allocation round, and $1.5 billion for the 2009 NMTC round.
This $3 billion in allocation authority is in addition to the $3.5 billion that was already allocated for the NMTC in 2009. The CDFI Fund estimates that the $6.5 billion in tax credits that will be awarded this year will help to develop or rehabilitate over 33 million square feet of real estate in low-income communities, supporting thousands of construction jobs in those communities.
Commenting on the CDFI Fund plan, Vice President Biden said, ""I commend Secretary Geithner and the Treasury Department for moving quickly to implement these innovative programs to help under-served communities. They are exactly what the President and I had in mind when we put forth the American Recovery and Reinvestment Act.""
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