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N.Y. Senate sets 15M for state CDFI fund
ALBANY, N.Y. (4/6/10)--The New York State Senate has called upon Gov. David Paterson to direct $15 million for an initial capitalization of the New York State Community Development Financial Institution (CDFI) Fund. The Senate passed its resolution on March 24 as a part of its Majority Resolution for a Fair and Responsible SFY10-11 Budget. CDFIs are community-based financial institutions that focus on lending to low- and moderate-income people and communities. About 78% of CDFI clients are low-income, 70% are minorities and 63% are female, said the National Federation of Community Development Credit Unions. “In fiscal year 2009, there were 110 CDFIs in New York with more than $1.93 billion in loans outstanding to more than 100,000 customers, including businesses, affordable housing developers, community facilities, microenterprises and individuals,” said Melanie Stern, federation senior program officer and coordinator of the New York Coalition of CDFIs. “CDFIs are experts at leveraging funds, and according to research conducted by the U.S. Department of the Treasury, CDFIs leverage federal dollars with private dollars by an average of 20 to 1. Based on this figure, we estimate that a $15 million appropriation to the New York CDFI Fund will allow the state’s CDFIs to leverage an additional $300 million in private sector investments,” she added. The State Assembly has yet to pass its own resolution for $15 million for CDFIs. But Stern is optimistic because the Assembly has been a traditional champion for CDFIs in New York, Stern said. “The only reason this program exists at all is because members of the assembly kept it alive with yearly allocations of $1 million to $1.5 million to expand CDFI lending to minority and women-owned business enterprises,” she added. “Our coalition is hopeful that the assembly will follow through on its long history of support to CDFIs and pass a resolution with a similar recommendation to the governor.” New York CDFI legislation is unique in that it is modeled after the federal CDFI Fund to allow a full range of CDFI activities. “At the federal level, CDFIs have become central players in promoting economic recovery,” said federation President/CEO Cliff Rosenthal. “Under the Obama administration, the federal CDFI Fund has seen its yearly appropriation more than double from its all-time high under President Clinton. With $250 million requested by the president for 2011, there’s never been a better time for New York State to expand its support of CDFIs.”
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