Three Kentucky Organizations Secure $40 Million in U.S. Treasury Bonds to Finance Community Development Projects
Only seven community development financial institutions (CDFIs) closed on the multi-party bond, and three of them are in Kentucky. With a total of $127 million, it is the largest group of bond participants in a single bond issue to date.
“Community development resources are shrinking every day,” stated Kevin R. Smith, President and CEO, Community Ventures. These resources will breathe new life into many projects across our commonwealth – projects to create jobs and better places for Kentuckians to live. We can’t thank the CDFI Fund and OFN enough for making it happen.”
The CDFI Bond Guarantee Program is designed to provide CDFIs with the long-term, reliable capital they need to stimulate development in low-income and under-resourced communities. Marking the third year of the program, this bond is part of a landmark round with $327 [cb1]million in bonds issued.
“This is game-changing and transformative,” said President and CEO of FAHE Jim King. “Thirty years of fixed money in the hands of CDFIs in Appalachia makes all the difference whether or not really important housing gets done. It allows us to focus on the task at hand and utilize our expertise in providing life-changing resources.”
Community Ventures, FAHE, KHIC and the other participants in this bond have the capacity to put long-term, fixed-rate, affordable capital to work across a broad geography, serving more under-resourced communities than ever before. The participants in the multi-party bond are:
- Community Ventures
- Fahe (Berea, Ky.), $15 million
- Kentucky Highlands (London, Ky.), $10 million
- Chicago Community Loan Fund
- Citizens Potawatomi Community Development Corporation (Shawnee, Okla.), $16 million
- New Jersey Community Capital, (New Brunswick, N.J.) $28 million
- Bridgeway Capital
“This unprecedented opportunity will help spur investment and job growth in the region,” said Jerry Rickett, president and CEO of Kentucky Highlands. “It also will help us maximize exciting efforts under way, such as SOAR and the Promise Zone.”
Opportunity Finance Network (OFN) was the qualified issuer.
“OFN is proud to have issued this multi-party bond for our member CDFIs to catalyze critical economic development in underserved areas throughout our country,” OFN Chief Operating Officer Cathy Dolan said.” This bond is a testament to the financial strength of our Member CDFIs, and a reflection of their effectiveness in providing access to responsible and affordable capital where it is needed most. Through this $127 million, multi-party bond, OFN Members like Community Ventures, FAHE and KHIC can reach further into tough markets to make a real difference. “
Enacted as part of the Small Business Jobs Act, the CDFI Bond Guarantee Program is an innovative federal credit program designed to function at zero cost to taxpayers. It provides eligible CDFIs access to long-term, fixed rate, affordable capital to encourage economic growth and development.
To learn more about how OFN connects CDFIs to critical financing, visit ofn.org. For more information on how the US Treasury Department’s CDFI Fund provides new access to capital to under-resourced communities, visit cdfifund.gov.