Editor’s note: The following is a press release from the City of Bloomington. Bloom has republished it here in its entirety with minor edits for clarity and style.
On Wednesday, September 30, Mayor John Hamilton will participate in a national panel discussion about the CDFI Friendly Strategy he pioneered in Bloomington. The strategy is now being adapted and adopted by other communities around the country.
Hosted by the Federal Reserve Bank of New York and CDFI Friendly America, “Expanding Access to CDFI Capital: CDFI Friendly America Working in Smaller Markets & Communities of Color” will take place from 1–2:30 p.m. Registration for the virtual video conference is available here.
Community Development Financial Institutions (CDFIs) are mission-oriented financial institutions that increase access to flexible, affordable financing for community development outside the margins of conventional finance. They provide capital and technical assistance services to underserved populations to catalyze small business growth, expand affordable housing, and support community facilities, while delivering solid financial returns.
Bloomington became the nation’s first CDFI Friendly City and the nonprofit CDFI Friendly Bloomington was formed in December 2018 to pair local investment opportunities with regional and national CDFIs.
CDFI Friendly Bloomington began its mission with $4 million in available financing to invest alongside CDFIs in local and regional community development projects. Initial seed funding for operations was provided by the Community Foundation of Bloomington and Monroe County, the Bloomington Urban Enterprise Association, and local and regional banks. In just its first year, CDFI Friendly Bloomington tripled what CDFIs had invested locally in the past 15 years, bringing in more than $15 million in capital and supporting 166 units of affordable housing.
“CDFIs over the past decades have often located in larger metropolitan markets, but I knew from personal experience how valuable they could be for us here, to connect local needs and resources with this wider source of capital investments and technical assistance,” said Mayor Hamilton. “We had to craft a new approach to attract existing CDFIs to town, and the CDFI Friendly initiative is just that. It has already brought millions of new dollars to our community, including, for example, helping fund affordable housing for Centerstone clients at Kinser Flats. We’re grateful to the community partners and financial institutions that have shared the vision to make this model work here, and excited about sharing the idea with other communities committed to equity and social justice.”
CDFIs have roots in the civil rights movement of the mid-20th century and became formalized with a federal program in the 1990s. Working with a group of community development activists, Mayor Hamilton founded and helped lead two CDFIs in Washington DC in the 1990s, City First Enterprises and City First Bank. The nonprofit and the bank have worked together for 25 years to promote social justice by increasing economic access and expanding opportunity for low-wealth communities. In August 2020, City First Bank announced plans to merge with Los Angeles-based Broadway Federal Bank to become the nation’s largest Black-led bank, with a combined $1 billion in assets under management and $850 million in deposits.