Over the past few months, Community Development Financial Institutions Fund (CDFI Fund) Director Annie Donovan and members of the CDFI Fund’s staff have been talking a lot about the CDFI Fund’s five-year Strategic Plan, which will guide the CDFI Fund’s program and administrative decisions in pursuit of greater economic and community development opportunities for low-income communities. The very first goal of the Strategic Plan, to increase the impact of CDFIs by supporting their growth, reach, and performance, has already made a significant difference in how the Community Development Financial Institutions Program (CDFI Program) and Native American CDFI Assistance Program (NACA Program) team is handling the application process.
For the fiscal year (FY) 2017 application round, the CDFI Program and NACA Program team made extensive changes to the Financial Assistance and Technical Assistance applications to encourage greater growth and performance from CDFIs. We’ve discussed the changes to the applications previously, and you can read more about those changes here. But something we haven’t talked about as much are the changes we’ve made to our application evaluation process this year.
When evaluating the CDFI Program and NACA Program applications this year, we plan to both look at the strength of the applicant’s business plan and to require that award recipients commit to achieving at least one of the following four Financial Assistance Objectives:
Expand operations into a new investment area or areas.
Serve a new targeted population or populations.
Provide new products or services.
Increase volume of products or services.
Further, highly qualified applicants will be assessed on the extent of economic distress in the areas they are serving; the extent to which their activities have expanded, or will expand, economic opportunities; and the extent to which the applicant will collaborate with their community and increase its resources though collaborations and partnerships. These criteria will affect the size of an organization’s award. Our primary objective is to let successful CDFI Program and NACA Program awardees maintain their flexibility to respond to local needs with market-driven solutions, but in a way that also encourages growth and expansion to the communities that are most in need of investment.
As a result of all of the changes to the application, the evaluation process looks different this year than it has for previous rounds. The application evaluation and award selection process for the FY 2017 round consists of five steps:
Step 1: Eligibility Review, conducted by CDFI Fund staff.
Step 2: Financial Analysis, conducted by external reviewers.
Step 3: Business Plan Review, conducted by external reviewers.
Step 4: Policy Objective Review, conducted by CDFI Fund staff.
Step 5: Award Amount Determination, conducted by CDFI Fund staff.
We have provided additional information about each of these evaluation steps in our CDFI Program and NACA Program Financial Assistance Evaluation Process document, available on the CDFI Fund’s website. I’d encourage you take a moment to look at the new process as the CDFI Fund spends the next few months reviewing the FY 2017 applications.
For more information about the CDFI Program and NACA Program, please visit www.cdfifund.gov/cdfi and www.cdfifund.gov/native.
Amber Kuchar-Bell is the Program Manager of the CDFI Program and NACA Program.