Over $186.9 million was recently awarded to nine Michigan Community Development Finance Institutions (CDFI) from federal funds to build capacity and advance their missions, supporting economic revitalization efforts in underserved communities across the state.
On September 19, the U.S. Department of Treasury’s Community Development Financial Institutions Fund (CDFI Fund) announced $5 billion in New Markets Tax Credit (NMTC) awards, including $175 million for three Michigan CDFIs. Plus, on September 26, the CDFI Fund awarded $408.2 million in Financial Assistance (FA) awards, including $11.9 million across six CDFIs.
From the NMTC awards, Michigan Community Capital received $65 million, Cinnaire received $60 million and Capital Impact Partners received $50 million. This New Markets Tax Credit program helps mission-driven lenders attract private investment capital to disinvested communities by providing individual and corporate investors a federal tax credit in exchange for investing in businesses or economic development projects. This incentive supports CDFIs’ ability to provide loans to projects delivering social impact in communities nationwide. Since the program’s inception in 2003, over $3.8 billion has been invested in Michigan projects, facilities, and businesses by leveraging the tax credit.
Seven Michigan CDFIs received $11.9 million in Financial Assistance awards through the CDFI Program and the Native American CDFI Assistance (NACA) program. And these programs provide monetary awards to invest in and build the capacity of CDFIs, empowering them to grow, achieve organizational sustainability, and contribute to the revitalization of low-income and distressed communities. CDFIs use FA awards for meeting goals such as expanding operations into a new investment area or areas; serving a new targeted population or populations; providing new products or services; or increasing the volume of products or services.
Financial Assistance awards were issued to these Michigan CDFIs:
— Chi Ishobak, Inc. – NACA Award – $2,000,000
— ELGA Credit Union – $625,000
— Grow – $510,000
— Invest Detroit – $800,000
— Northern Initiatives – $625,000
— PropsperUs Detroit – $550,000
— Capital Impact Partners – $800,000
Along with the FA award, Capital Impact Partners also received a $1 million supplemental Disability Fund award and a $5 million supplemental Healthy Food Financing Initiative award.
CDFIs are mission-based lenders that offer flexible and affordable financing to small and micro-businesses, first-time home buyers, affordable housing developments, and projects that revitalize neighborhoods, commercial corridors, and community spaces. And CDFIs expand access to capital and the resources needed to grow communities by offering financial services, technical assistance, and more.
The Michigan CDFI Coalition (founded in 2023) brings together CDFIs across the state, working closely to forge inclusive policies and bolster community investment, all while providing flexible and affordable capital to uplift underserved communities and support nontraditional borrowers. And the Coalition advocates for vital programs, such as the MI CDFI Fund Program, to support the work of CDFIs in Michigan.
KEY QUOTES:
“The New Markets Tax Credit is an essential tool that drives meaningful change in underserved communities, creating opportunities for people and places that have historically been left behind. By incentivizing private investment in projects that create jobs, expand access to vital services, and strengthen local economies, the NMTC program fuels growth where it’s needed most. Working alongside our Michigan CDFI Coalition partners, we’re able to amplify this impact, aligning resources and expertise to ensure that communities across the state benefit from inclusive, sustainable development.”
-Mark McDaniel, Cinnaire president and CEO
“This is a tremendous honor and opportunity for Chi Ishobak. This incredible gift from the CDFI Fund will have a profound impact within Indian Country for tribal entrepreneurs and tribal consumers. It provides critical resources within a grossly underserved community.”
-Sean Winters, executive director of Chi Ishobak
“We are grateful for this NMTC allocation and the FA awards, which will help Capital Impact Partners’ work in disinvested communities in Detroit and several of our other geographic focus areas around the country. The NMTC award will help us bring private investors and key partners together to increase access to critical social services, including health care, education, and healthy foods.”
-Mindy Christensen, senior vice president of community development lending for Capital Impact Partners, part of the Momentus Capital branded family of organizations
