The Trump administration is once again seeking to shrink funding for the Community Development Financial Institutions Fund and redirect the remaining monies to rural communities.
The White House’s proposed budget for fiscal year 2027 calls on Congress to trim the CDFI Fund’s budget by $204.5 million, or roughly two-thirds of the program’s current budget. It accuses past administrations of using the fund “to advance a partisan agenda” that included race-based lending and “immigration, gender and climate radicalism.” It would instead redirect remaining CDFI Fund awards to rural communities “where the awards are most beneficial.”
The administration previously proposed trimming the CDFI Fund budget by roughly the same amount, but that proposal met bipartisan resistance. Lawmakers instead agreed to maintain the program’s budget at $324 million in fiscal year 2026.
Last year, the Treasury Department announced it would modify the fund’s New Market Tax Credits program allocations to ensure compliance with federal anti-discrimination laws. The department also said it would increase monitoring of award recipients.
