CDFI Fund Allocation Agreement: What You Need to Know
As the name suggests, a CDFI Fund Allocation Agreement is a legal document that outlines the terms and conditions of the allocation of funds from the Community Development Financial Institutions (CDFI) Fund. This agreement is signed between the US Treasury Department and the CDFI institution that is receiving the funds.
The CDFI Fund was established in 1994 to promote economic growth in low-income communities by providing financial assistance to CDFIs. These institutions are specialized financial organizations that provide credit, loans, and other financial services to underserved populations and communities. The CDFI Fund provides a variety of funding programs to CDFIs, including grants, loans, and tax credits.
The CDFI Fund Allocation Agreement is a critical document that establishes the terms and conditions between the CDFI and the government. It outlines the rules and procedures for the allocation of funds, including the amount of funding, the timeframe for disbursing the funds, and the reporting requirements.
The CDFI institution must comply with the terms and conditions set forth in the agreement, including the use of funds for approved programs and projects. The institution must also maintain accurate records and submit timely reports to the government.
The CDFI Fund Allocation Agreement also establishes a set of performance goals that the CDFI institution must achieve to receive continued funding in the future. These goals may include meeting certain lending or investment targets, serving a specific number of underserved individuals or communities, or providing financial education or other support programs.
In addition to the compliance and reporting requirements, the CDFI institution must also adhere to certain legal and regulatory requirements, including anti-discrimination laws, fraud prevention measures, and data privacy regulations.
In summary, the CDFI Fund Allocation Agreement is a critical document that outlines the terms and conditions for the allocation of funds from the CDFI Fund. It sets forth the rules and procedures for the use of funds, establishes performance goals, and requires compliance with legal and regulatory requirements. CDFI institutions must carefully review and comply with the terms of the agreement to ensure continued funding and support for their mission of promoting economic growth in underserved communities.