GoWest Reviews Treasury’s New CDFI Certification Application

Posted by Ryan Fitzgerald on December 8, 2023

On Thursday, the U.S. Department of Treasury’s Community Development Financial Institutions (CDFI) Fund released a revised CDFI Certification Application, following over a year of public comment and advocacy around its mishandled efforts to overhaul the CDFI certification and recertification process.

In its announcement, Treasury and CDFI leadership outlined that the CDFI Certification Application, as well as the Annual Certification and Data Collection Report (ACR) and abbreviated Transaction Level Report (TLR), were approved by the Office of Management and Budget (OMB) for release and use by the program going forward. The new application and reports include several modifications that were made in response to the advocacy work and public comments that were provided by program participants and advocates over the last year.

The GoWest advocacy team is working with Chief Impact Officer and GoWest Foundation Executive Director Sharee Adkins, and CUNA, to further research the nuances and details of the revisions that were made to the CDFI application as well as the ACR and TLR reporting requirements to better understand and outline to our members the requirements that have been put in place. We’re investigating whether thoughtful steps were truly taken to clarify and make the reporting requirements more streamlined, fair, and straightforward for applying entities, as was requested in our advocacy efforts this year. As we initiate our review of the applications and reporting requirements, here are some of the high-level details and timelines from the announcement:

Recertification Timeline Phase-In

The CDFI program is instituting a phased-in approach for credit unions and other organizations seeking to become newly certified or renew their CDFI Certification in the coming year.

1. Non-Certified Organizations – at the initial outset of the new CDFI certification application and process, only non-certified organizations will be able to immediately apply for CDFI Certification when the Certification Application Portal (AMIS) reopens on December 20, 2023. 
2. Existing CDFIs – all current CDFI-certified credit unions and other organizations will be required to reapply for certification using the new application by December 20, 2024. In the meantime, all currently certified CDFIs will retain their status as certified CDFIs and will remain eligible to apply for all CDFI funds and programs where certification is a requirement.

According to the CDFI’s announcement, earlier today, “all currently certified CDFI’s are required to reapply for CDFI certification utilizing the revised application, which must be submitted between August 1, 2024 – December 20, 2024. Organizations that do not submit an application by December 20, 2024, will lose their CDFI certification. The CDFI Fund will begin reviewing these submissions on a rolling basis after December 20, 2024. All general Certification Application reviews will be completed by December 20, 2025.”

During the review of the recertification, applicants who are requesting recertification will remain CDFI certified, in a grace period, until a final review and notification of their application determination has been completed and announced by Treasury.

The CDFI announcement also outlined the opportunity to utilize the “Early Reapplication Submission,” which has been established to manage the flow of recertification applications and expedite recertification determinations. The CDFI Fund will be offering 700 slots for currently certified CDFIs that would like to voluntarily submit a revised application to recertify before the December 20, 2024, general submission deadline. The applicants that submit their recertification request early will receive an earlier determination on CDFI status. If a credit union wishes to submit for early recertification, they must notify CDFI Fund of their plans to submit an early application by February 1, 2024, with the recertification applications submitted between May 31, 2024, and July 31, 2024. The CDFI Fund will provide determinations via AMIS on all early Certification reapplication submissions by October 31, 2024.

Transaction Level Reporting Modifications

Under the revised CDFI certification policies, all new applicants as well as all currently certified CDFIs will be required to submit a TLR, both as part of an initial certification application and then on an annual basis as part of their ACR submission package.

1. New applicants will complete and submit an abbreviated version of the TLR prior to the submission of their CDFI Certification Application. This abbreviated TLR will be used to assess compliance with applicable Target Market percentage benchmarks in the applicant’s proposed Target Market(s).
2. The determination on what version of the TLR that will be submitted by current CDFIs will be determined by the type of program and award that has been received.

Annual Certification and Data Collection Report Modifications

According to the announcement, the ACR submission will verify whether a current CDFI continues to meet the requirements of certification. Under the revisions, current CDFIs using the revised application will now be required to submit a new ACR within 180 days of their fiscal year end, after they are recertified, which was extended from 90 days. Current CDFIs, however, still must submit the ACR under the 90-day requirement until they are recertified using the new application.

The GoWest Advocacy team has consistently worked to share our concerns with Treasury’s challenges and lack of transparency in the CDFI recertification process. We also called on Congress to more strongly outline their desire to maintain a robust CDFI program and to outline Congressional intent to support urban and rural underserved communities. As we continue to unpack and review this new certification process, we will continue to keep our members informed on additional advocacy opportunities as it pertains to the CDFI Fund and this revised certification process. We encourage our members to reach out and collaborate with us as we work to better identify the impact of the changes that have been finalized by the CDFI program in this process, and to determine if it will continue to allow you to serve your members and communities in the best manner possible.

Treasury will be hosting a CDFI Certification / Re-Certification Webinar on Wednesday, December 13, 2023 at 1:30 pm EST, and you can register for that by clicking here.

1. The announcement from CDFI with additional information can be found at this link, which has additional supportive links at the conclusion of the page, including:
   1. The new CDFI Application
   2. The new ACR Reporting requirements,
   3. The new abbreviated TLR Reporting requirements

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