Congress funded it. Treasury is sitting on it.

Thirty-two years ago today, President Bill Clinton signed a bipartisan law creating the CDFI Fund. One week from today, $289 million that Congress appropriated for it could expire unspent. The lapse date is September 30, and lenders who serve communities that Wall Street has long overlooked are running out of time.

There are echoes of history in the current fight over Community Development Financial Institutions (CDFIs).

CDFIs are private-sector, mission-driven lenders (banks, credit unions, loan funds, and venture funds) that channel capital into communities that traditional finance has often ignored or abandoned. They make loans for small businesses, affordable housing, and community facilities; they offer technical assistance and flexible underwriting that conventional lenders won't; and they measure success on a "double bottom line" of financial return and community impact.

Ben Franklin democratized finance more than 200 years ago with a simple loan fund for tradesmen, and that model still powers CDFIs helping people today. Later, nineteenth-century immigrant mutual aid societies and Prairie Populist cooperatives sprang up, followed by community development credit unions organized by African American communities in the 1930s. The modern CDFI movement took shape in the 1970s and 80s and was codified in the 1990s.

The Riegle Community Development and Regulatory Improvement Act was signed on September 23, 1994, establishing the CDFI Fund at the U.S. Department of the Treasury. It passed with broad bipartisan support that has held for three decades.

That’s what makes the present moment so unsettling. Today, $289 million in congressionally appropriated FY2025 funds for the CDFI Fund sit unreleased, with a lapse deadline just one week from now at federal fiscal year end, September 30.

Yesterday, the Freedom Economy Business Association sued the Trump Administration, seeking to force Treasury to distribute that money before it expires. Although Treasury announced awards on September 15, the complaint says it had not identified recipients or obligated the funds. The group is requesting a temporary restraining order and preliminary injunction and seeks action on an additional $289 million approved by Congress for fiscal year 2026.

This is the second suit over the withheld funds. CAMEO Network and Inclusive Action for the City sued in August, noting that Treasury still hasn't committed to distributing the full amount.

This follows more than a year of efforts to slash CDFI Fund staff and a partial release of funds in April tied to new compliance conditions, all leading to continued uncertainty for lenders working in underserved urban and rural communities nationwide.

There are similar concerns brewing over proposed changes to the Community Reinvestment Act (CRA), which has long worked hand in hand with CDFIs to direct bank capital into distressed (read Redlined) neighborhoods.

From 198 certified CDFIs in 1994 to more than 1,500 today, three decades of experience have made our movement sharper, stronger, and ready for whatever crisis comes next. We’re not going anywhere without a fight.

Please contact your member of Congress and urge them to release and protect the CDFI Fund and CRA resources, and to sustain federal programs that enable mission-driven community lending.

Need more background? Visit our website – watch our videos – share them on your social platforms. The clock is ticking, and every minute of delay starves families and communities of the resources they need to thrive.