CDFI (LACK OF) PROGRESS REPORT

CDFI is the Community Development Financial Institutions Act which had
bi-partisan support in the 103rd Congress and was signed into law by Pres
Clinton in September 1994. Unfortunately, unless we can turn things around,
the signing of the act will be the high water point in this effort.

BACKGROUND: The CDFI Act recognizes that community based financial
institutions can be an effective and efficient tool in community
development. The Act sets aside $125 million in 1995 for matching loans and
grants to CDFIs. A staff has been assembled, but a director has not been
appointed (and confirmed), though Kirsten Moy is rumored to be the nominee.

Two weeks ago the House Subcommittee on VA and HUD Approprations added CDFI
to its recission package. This means that while the CDFI Act itself is
intact, the funding would be removed. The battle shifted to the Senate
Appropriations Committee and the Subcommittee on VA, HUD and Independent
Agencies. Senate action is expected to take place next week (March 13-17).

CONTEXT: The House also considered legislation removing Glass-Steagall
restrctions on bank stock underwriting and removing the teeth from the
Community Reinvestment Act. In non-bank actions, the House has been
preparing to reduce taxes for the wealthy, paid for by cutting social
programs. In short, things aren't going our way.

NEXT: The President could veto the recission package. That veto could
likely be upheld in Congress (requires a 2/3 vote to override). However,
Congress still must act on the appointment of the CDFI administration
appointment, and this could prove to be another stumbling block.

WHAT CAN I DO? It's still appropriate to contact your Senators and speak in
favor of CDFI.

There are three national organizations keeping up with this issue much more
closely than I. I sure they have more details they can FAX or mail to you.
- CDFI Coalition at 215-736-1644.
- National Association of Community Development Loan Funds 215-923-4754.
- CDFI Fund at 202.622.0113
- National Federation of Community Development Credit Unions 212-809-1850

************************************************** **********
William Myers
Alternatives Federal Credit Union
301 West State Street, Ithaca, NY 14850-5431
Voice (607) 273-3582 ext 817 FAX (607) 277-6391
E-Mail Alternatives@pobox.com
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Actually, the full House will vote on this next Wednesday. Action is
expected in the Senate Subcommittee on HUD-VA and Independent Agenices
(Senator Bond is chair) sometime prior to the Easter Recess, i.e., prior to
mid April.


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