Senators Ask White House To Release Cdfi Funds

A bipartisan group of U.S. senators is urging the Trump administration to release $324 million in funding that was already approved to help small businesses and communities in poor and rural areas.

In a letter viewed by Bloomberg News, lawmakers led by Senate Banking Committee members Mike Crapo (R-Idaho) and Mark Warner (D-Va.) requested that Russell Vought, director of the White House Office of Management and Budget (OMB), release funds appropriated to the CDFI Fund, a U.S. Treasury office that issues grants to mortgage lenders that serve places often ignored by traditional banks.

Community development financial institutions (CDFIs) commonly finance small businesses and commercial real estate ventures. These grants help turn public money into much larger amounts of private investment. Every year, they help generate more than $300 billion in loans and mortgages, according to Bloomberg’s report.

But Vought and other White House officials have moved to shut down the CDFI Fund as part of the Trump administration’s broader push to roll back diversity, equity and inclusion (DEI) programs — despite the program’s ability to help residents in both blue and red states.

Right now, lenders are reporting that the CDFI money is frozen and the White House hasn’t released it, leading several programs to pause their acceptance of new applications.

Senators, including Tim Scott (R-S.C.) and Chuck Schumer (D-N.Y.), said the CDFI Fund hasn’t distributed funds for five programs despite the application periods closing months ago. The lawmakers urged the OMB to provide a plan and timeline for releasing the funds, warning that delays are stalling vital projects and limiting access to capital.

Lenders that targeted underserved communities began emerging in the 1970s to create economic opportunities for individuals and businesses who couldn’t qualify for traditional loans because of limited credit history or lack of collateral. As a result, Congress established the CDFI Fund in 1994 to expand the lenders’ impact.

In 2024, the fund distributed $6.3 billion in awards, tax credits and guarantees, with additional backing from Wall Street and major donors, to help nearly 9 million people.

Earlier this year, Congress approved $324 million more for the fund. But a March 14 White House executive order directed the CDFI Fund to scale back operations to only what is legally required.

The move marked a shift for Trump, who had previously supported the fund by increasing its allocations during his first term.