CDFI Funding?

[OneTun at msn.com]

I*am researching the structure of CDFIs and CDEs. I have come across some issues when reviewing the application for CDFI federal grants. On page 17 and 18 there are 10 questions about "elected" officials on the Board. Is it possible to receive Federal Grants with*elected-officials on the board, and if it is possible how? Would it be wiser to just ask the elected members to step down or suggest*emeritus status? Does*anyone happen to know of any CDFIs that have received funding with the elected-officials on the board that I could be referred to?
*
Jim Tunnessen
LDC
OneTun@msn.com (onetun@msn.com)


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[smithp at cdfi.treas.gov]

Dear Jim,
*
It is possible to have an elected official(s) serving on your Board and to receive Federal Grants, and to still become a certified CDFI.* However, in order to pass the Non-Governmental Entity test you must demonstrate that your organization is not controlled financially or through special decision making power, by any one or collection of government entities.* Although the CDFI Fund does not hold you to a specific ratio of non-government affiliated individuals to those elected, appointed or generally employed by a government entity, you should keep*the number of government representatives to a small minority on your Board (give me a call and I*can give you feedback about your specific count).**
*
To determine whether you pass this test CDFI Fund staff will check*the*non-Governmental Entity forms*that you've filled out in the application, your*incorporating documents and financial statements.**Remember that if you check "yes" to any of the boxes on the forms to provide a thorough narrative to*explain*the circumstances.**We check your incorporating documents to*assess whether*the participation of government representatives*is*mandated, and if so, how many and*whether they*have*standard (one-vote) voting priveleges or not.* We check your financial statements to determine if one government entity contributes a large proportion or the majority of your*financial*resources (operating budget and lending capital).* In some cases a concentration of funding from one government entity is a temporary condition, due to the timing of funds received, etc.... We'd take this into account.
*
In summary, if your organization has been structured to have a government-heavy Board, as a number of established community development organizations have, it may be a very good idea to graduate some of the government representatives to a non-voting "emeritus" status and to amend your bylaws for the purposes of obtaining CDFI certification.
*
Give me a call if you'd like more advice.
*
Paula Smith
CDFI Fund
Financial and Programs Analyst
fax/phone:* 949/458-0286
-----Original Message-----
From: James Tunnessen Jr [mailto:OneTun@msn.com]
Sent: Thursday, May 23, 2002 2:34 PM
To: COMMUNITYDEVELOPMENTBANKING-L@cornell.edu
Subject: CDFI Funding?


I*am researching the structure of CDFIs and CDEs. I have come across some issues when reviewing the application for CDFI federal grants. On page 17 and 18 there are 10 questions about "elected" officials on the Board. Is it possible to receive Federal Grants with*elected-officials on the board, and if it is possible how? Would it be wiser to just ask the elected members to step down or suggest*emeritus status? Does*anyone happen to know of any CDFIs that have received funding with the elected-officials on the board that I could be referred to?
*
Jim Tunnessen
LDC
OneTun@msn.com (onetun@msn.com)


This post transferred from the cdb-l mailing list