Federal Register / Vol. 62, No. 65 / Friday, April 4, 1997 / Notices 16461

lending or investments, serve an

investment area or a targeted

population, provide development

services, maintain community

accountability, and be a nongovernment

entity. The details of these requirements

and other program requirements are

described in the revised interim rule

governing the CDFI Program (12 CFR

part 1805) which is published elsewhere

in this issue of the Federal Register. A

CDFI, or proposed CDFI, whose primary

focus is financing other CDFIs and/or

providing financing to support the

formation of CDFIs shall not be eligible

to apply pursuant to this Notice, but

instead may be eligible to apply

pursuant to the Notice on the

intermediary component published

elsewhere in this issue of the Federal

Register.

III. Types of Assistance

An applicant may submit an

application for financial assistance,

technical assistance, or both. Financial

assistance may be provided through an

equity investment, a grant, a loan,

deposits, credit union shares, or some

combination thereof. Applicants for

financial assistance shall indicate the

dollar amount, form, terms, and

conditions of assistance requested.

Applicants for technical assistance shall

describe the types of technical

assistance requested, estimate the cost

to obtain such assistance, and provide a

narrative justification of its needs for

such assistance.

IV. Application Packet

Except as described hereafter, an

applicant, whether applying for

financial assistance, technical

assistance, or both, shall submit the

materials described in § 1805.701 and

the application packet. To facilitate

coherence and avoid duplication, an

applicant may present its application in

an order and format that it believes to

be the most appropriate, provided that

the requested information is included

and that an index is provided to assist

the Fund in locating the items requested

by § 1805.701.

If an applicant is currently certified as

a CDFI, it may, at its option, submit a

copy of the letter of certification in lieu

of the information requested in Part III,

A through H, of the application packet.

However, an applicant should include

in its application information that it

believes is relevant to the substantive

review of the application specified in

§ 1805.802(b).

V. Matching Funds

Applicants pursuant to this Notice

may use for matching funds monies

obtained or legally committed on or

after January 1, 1996. Applicants

selected to receive assistance under this

Notice must have firm commitments for

the matching funds required pursuant to

§ 1805.600 by no later than August 31,

1997. The Fund may recapture and

reprogram funds if an applicant fails to

raise the required match by such date.

The Fund reserves the right to grant an

extension of such matching funds

deadline for specific applicants selected

for assistance if the Fund deems it

appropriate.

VI. Selection Factors

Applications will be selected on a

competitive basis in accordance with

criteria described in §§ 1805.800 to

1805.802. Special emphasis is expected

to be placed on:

(1) The applicant’s track record,

financial strength, and current

operations;

(2) The capacity, skills, and

experience of the management team;

(3) The quality of the applicant’s

comprehensive business plan;

(4) The likelihood that the applicant

will be able to raise the required

matching funds; and

(5) The extent and nature of the

potential community development

impact that would be catalyzed by the

Fund’s assistance, relative to the

amount of such assistance to be

provided.

The applicant’s track record, financial

strength and current operations are

important to the extent they may be

suggestive about the prospects for

success in the future. In the case of a

young or start-up institution with no or

a limited track record, extra emphasis

will be placed on the capacity, skills,

and experience of the applicant’s

management team and the quality of its

comprehensive business plan.

While previous awardees are eligible

to apply pursuant to this Notice, it is the

current expectation of the Fund that a

substantial majority of the funds

awarded pursuant to this Notice will be

to applicants that are not previous

awardees. Therefore, the Fund may give

additional consideration to applicants

that are not previous awardees.

The Fund has sole discretion in the

selection of applications for assistance.

The anticipated maximum award per

applicant under this Notice is $2

million. However, the Fund, in its sole

discretion, reserves the right to award

amounts in excess of $2 million for an

applicant(s) if it deems it appropriate.

VII. Workshops

The CDFI Fund expects to host

workshops to disseminate information

to organizations interested in applying

for assistance pursuant to this Notice. If

you wish to be on a mailing list to

receive information about the

scheduling of such workshops, please

contact the Fund.

VIII. Other Matters

(a) Paperwork Reduction Act. The

reader should refer to the revised

interim rule (12 CFR part 1805)

published elsewhere in this issue of the

Federal Register for details on the

information collection requirements of

the rule and this Notice.

(b) Environmental Impact. Pursuant to

Treasury Directive 75–02, the

Department of the Treasury has

determined that implementation of the

CDFI Program under the revised interim

rule is categorically excluded from the

National Environmental Policy Act of

1969 (42 U.S.C. 4332) and does not

require an environmental review. The

determination is available for public

inspection between 9:30 a.m. and 4:30

p.m. weekdays at the office of the Fund.

Authority: 12 U.S.C. 4703, 4717: Chapter

X, Pub. L. 104–19, Stat. 237; 12 CFR

1805.700.

Kirsten S. Moy,

Director, Community Development Financial

Institutions Fund.

[FR Doc. 97–8785 Filed 4–2–97; 1:09 pm]

BILLING CODE 4810–70–P

Community Development Financial

Institutions Fund

Notice of Funds Availability (NOFA)

Inviting Applications for the

Community Development Financial

Institutions (CDFI) Program—

Intermediary Component

AGENCY: Community Development

Financial Institutions Fund, Department

of the Treasury.

ACTION: Notice of Funds Availability

(NOFA) inviting applications.

SUMMARY: The Community Development

Banking and Financial Institutions Act

of 1994 (12 U.S.C. 4701 et seq.)

(hereafter referred to as the ‘‘Act’’)

provides authority for the Community

Development Financial Institutions

Fund (hereafter referred to as ‘‘the

Fund’’) to select and provide assistance

to eligible applicants under the

Community Development Financial

Institutions (‘‘CDFI’’) Program. The

revised interim rule (12 CFR part 1805),

published elsewhere in this issue of the

Federal Register, provides guidance on

the contents of necessary application

materials and program requirements.

This Notice is in connection with two
16462 Federal Register / Vol. 62, No. 65 / Friday, April 4, 1997 / Notices

competitive rounds of a new

intermediary component of the CDFI

Program. This intermediary component

will provide financial assistance to

CDFIs that provide financing primarily

to other CDFIs and/or to support the

formation of CDFIs. The Fund currently

anticipates making awards of between

$5.0 million and $7.5 million in

appropriated funds pursuant to this

Notice. Also being published elsewhere

in this issue of the Federal Register is

a separate Notice in connection with the

core component of the CDFI Program,

with respect to which the Fund intends

to make available up to $32.5 million in

appropriated funds.

DATES/TWO ROUNDS: Applications may

be submitted at any time after April 4,

1997. Applications will be evaluated

competitively for the intermediary

component in two separate rounds. For

the first round, the deadline for receipt

of an application is 6 p.m. Eastern

Standard Time on Friday, May 16, 1997.

For the second round, the deadline for

receipt of an application is 6 p.m.

Eastern Standard Time on Friday, June

20, 1997. Applications received after the

deadline for the first round but before

the deadline for the second round will

be considered as part of the second

round. Applications received after the

deadline for the second round will not

be accepted and will be returned to the

sender. An applicant may apply in each

round. Applications sent to the Fund by

facsimile will not be accepted.

The Fund anticipates making

available at least $5 million in

appropriated funds pursuant to this

Notice. If less than $2.5 million in

appropriated funds is awarded in the

first round, the amount of available

funds for the second round will be $5

million less the amount awarded in the

first round. If $2.5 million or more is

awarded during the first round, the

amount of available funds for the

second round will be $2.5 million. As

of the date of this Notice, for the two

rounds combined, the Fund intends to

award no more than $7.5 million in

appropriated funds. The Fund reserves

the right to award higher or lower

amounts in each round, and for the two

rounds combined, than the amounts

described above, depending on the

quality of applications received in each

round.

The anticipated maximum aggregate

award per applicant under this Notice

(i.e. for both rounds combined) is $1.25

million. However, the Fund, in its sole

discretion, reserves the right to award

amounts in excess of $1.25 million for

an applicant(s) if it deems it

appropriate.

ADDRESSES: Applications must be sent

to: The Community Development

Financial Institutions Fund, U.S.

Department of the Treasury, 1500

Pennsylvania Avenue, NW.,

Washington, DC 20220.

FOR FURTHER INFORMATION CONTACT: The

Community Development Financial

Institutions Fund, U.S. Department of

the Treasury, 1500 Pennsylvania

Avenue, NW., Washington, DC 20220,

(202) 622–8662. (This is not a toll free

number.) If you have any questions

about the regulations, this Notice or the

application packet, you may call or

write to the Fund at the above telephone

number or address, or you may send

questions by facsimile to (202) 622–

7754. To request an application packet,

please send by facsimile a written

request which includes the name of the

requester, organization, mailing address,

telephone number and facsimile

number. Requests for an application

packet should be sent by facsimile to

(202) 622–2599, which is the facsimile

number being used to receive requests

for an application packet.

SUPPLEMENTARY INFORMATION:

I. Background

Credit and investment capital are

essential ingredients in creating and

retaining jobs, developing affordable

housing, starting or expanding

businesses, revitalizing neighborhoods,

and empowering people. As a key urban

and rural policy initiative, the CDFI

Program is facilitating the creation of a

national network of financial

institutions that are specifically

dedicated to community development.

This strategy will build strong

institutions that make loans and

investments and provide services to

economically distressed investment

areas and disadvantaged targeted

populations. This Notice is in

connection with a new intermediary

component of the CDFI Program.

Elsewhere in this issue of the Federal

Register, the Fund is publishing a new

Notice of Funds Availability for

financial and technical assistance to

CDFIs pursuant to the direct funding

approach used in the first round. That

separate Notice is in connection with

the core component of the CDFI

Program, and the Fund anticipates that

for the foreseeable future, the Fund will

devote the great bulk of the financial

assistance available for the CDFI

Program to this core component. In the

separate Notice for the core component,

the Fund is making available up to

$32.5 million in appropriated funds.

The Fund also recognizes that to

address the diverse needs and take full

advantage of the enormous potential of

the growing CDFI industry, it is

important that the Fund be on the

cutting edge of innovation by expanding

the tools it utilizes to assist CDFIs. This

Notice in connection with an

intermediary component of the CDFI

Program is one part of a broader effort

to develop and make available such new

tools.

The Fund recognizes that there are in

existence certain intermediary CDFIs,

and others may be created over time,

that focus their financing activities

primarily on financing other CDFIs.

Such institutions may have knowledge

and capacity to develop and implement

a specialized niche or niches in their

financing of CDFIs and/or CDFIs in

formation. The Fund believes that

providing financial assistance to such

intermediaries can be an effective way

to expand its support of the CDFI

industry. To illustrate the concept of an

intermediary CDFI with a few examples,

an intermediary may have a specialized

niche or niches focusing on financing a

specific type or types of CDFIs,

providing small amounts of capital per

CDFI, financing CDFIs with specialized

risk levels, or financing institutions

seeking to become CDFIs. By providing

financial assistance to specialized

intermediaries, the Fund believes it can

leverage the expertise of such

intermediaries and strengthen the

Fund’s capacity to support the

development and enhancement of the

CDFI industry. This Notice invites

applications from CDFIs, and

organizations seeking to become CDFIs,

that are or plan to become such a

specialized intermediary, focusing on

providing loans to or investments in

other CDFIs and/or to support the

formation of CDFIs. This Notice is not

intended and should not be construed to

allow an applicant to file a joint

application on behalf of a group of other

CDFIs, but rather to provide financial

assistance to intermediaries who have

criteria for financing, in arms length

transactions, other CDFIs and/or to

support the formation of CDFIs.

This Notice implements the

intermediary component by using two

competitive rounds. This should

expedite the ability of intermediary

CDFIs to provide financing to other

CDFIs, and should assist the ability of

the intermediary component of the CDFI

Program to work effectively with the

core component in a mutually

supportive manner. Many CDFIs will be

facing the decision of whether they

should devote the substantial time and

effort necessary to prepare an

application, due by June 20, 1997, in

response to the core component Notice
Federal Register / Vol. 62, No. 65 / Friday, April 4, 1997 / Notices 16463

published elsewhere in this issue of the

Federal Register. Given what is

expected to be the highly competitive

nature of the core component round,

many CDFIs may decide not to apply for

the core component, but instead to

concentrate on seeking assistance from

an intermediary.

The Fund believes, however, that

there may be some intermediary

organizations that wish to apply for

assistance in response to this

intermediary component Notice, that

will need more time to submit a quality

application than is provided by the May

16, 1997, deadline for the first round.

Such organizations may apply in the

second round by the June 20, 1997,

deadline.

II. Eligibility

An applicant for assistance pursuant

to this Notice must meet the eligibility

requirements set forth in § 1805.200. In

addition, pursuant to § 1805.200(a)(3),

this Notice is limited to applicants that

satisfy the following requirements: (1)

The applicant’s financings (loans and/or

development investments) must

primarily focus on financing other

CDFIs and/or supporting the formation

of CDFIs; and (2) if the applicant is not

a CDFI at the time of application, the

application shall include a realistic plan

for the applicant to become a CDFI

within one year of the date on which the

Fund approves the applicant for

financial assistance (which period may

be extended at the sole discretion of the

Fund). In no event will the Fund

disburse assistance to the applicant

until the applicant can be certified as a

CDFI.

III. Types of Assistance

An applicant may submit an

application for financial assistance in

the form of an equity investment, loan,

or grant (or a combination of these

financial assistance instruments).

Applicants for financial assistance shall

indicate the dollar amount, form, terms,

and conditions of assistance requested.

The Fund will not accept applications

for technical assistance pursuant to this

Notice.

Since an intermediary that is selected

pursuant to this Notice must be a CDFI

when funded, its predominant business

activity must be the provision of loans

and/or development investments. Thus,

even if an intermediary applicant

receives a grant from the Fund, the

Fund will normally expect that the

intermediary will use such grant to

enhance its ability to make loans and/

or development investments in CDFIs or

to support the formation of CDFIs.

However, the Fund will consider

requests by an intermediary applicant to

utilize Fund assistance to enhance the

ability of the intermediary to make

grants to CDFIs or to support the

formation of CDFIs, as long as the

intermediary applicant makes a

persuasive case that using Fund

assistance in this manner will further

the purposes of the Act, and as long as

the intermediary’s predominant

business activity will remain the

provision of loans and/or development

investments.

IV. Application Packet

Except as described hereafter, an

applicant shall submit the materials

described in § 1805.701 and the

application packet. To facilitate

coherence and avoid duplication, an

applicant may present its application in

an order and format that it believes to

be the most appropriate, provided that

the requested information is included

and that an index is provided to assist

the Fund in locating the items requested

by § 1805.701.

If an applicant is currently certified as

a CDFI, it may, at its option, submit a

copy of the letter of certification in lieu

of the information requested in Part III,

A through H, of the application packet.

However, an applicant should include

in its application information that it

believes is relevant to the substantive

review of the application specified in

§ 1805.802(b).

Since the target markets served by an

applicant pursuant to this Notice will

depend on the target markets served by

CDFIs funded by the applicant, the

applicant need not fill out Part III, C.

Map of Investment Area(s), D. Studies or

Analyses of Unmet Needs, or L. Target

Market Designation, or the Investment

Area Designation Worksheet. Instead the

applicant should describe its target

markets, which description may be

general in nature and may include target

markets that are regional or national in

scope. The application should include a

general description and analysis of

target markets served by CDFIs and/or

CDFIs in formation which the applicant

currently finances, and what changes in

such target markets, if any, may be

expected if the applicant receives

financial assistance from the Fund. If

applicable, the applicant should provide

a list of CDFIs or CDFIs in formation

that it has financed, and the amount and

form of financing, over at least the last

three years.

V. Matching Funds

Applicants pursuant to this Notice

may use for matching funds monies

obtained or legally committed on or

after January 1, 1996. Applicants

selected to receive assistance under this

Notice must have firm commitments for

the matching funds required pursuant to

§ 1805.600 by no later than August 31,

1997. The Fund may recapture and

reprogram funds if an applicant fails to

raise the required match by such date.

The Fund reserves the right to extend

such matching funds deadline for

specific applicants selected for

assistance if the Fund deems it

appropriate.

VI. Selection Factors

Applications will be selected on a

competitive basis in accordance with

criteria described in 12 CFR 1805.800 to

1805.802. The Fund has sole discretion

in the selection of applications for

assistance. Special emphasis is expected

to be placed on:

(1) The applicant’s track record,

financial strength, and current

operations;

(2) The capacity, skills, and

experience of the management team;

(3) The quality of the applicant’s

comprehensive business plan;

(4) The likelihood that the applicant

will be able to raise the required

matching funds; and

(5) The extent and nature of the

potential community development

impact that would be catalyzed by the

Fund’s assistance, relative to the

amount of such assistance to be

provided.

The applicant’s track record, financial

strength, and current operations are

important to the extent they may be

suggestive about the prospects for

success in the future. In the case of a

young or start-up institution with no or

a limited track record, extra emphasis

will be placed on the capacity, skills,

and experience of the applicant’s

management team and the quality of its

comprehensive business plan.

For the purposes of evaluating

applications submitted pursuant to this

Notice, the Fund will evaluate the

extent to which provision of financial

assistance by the Fund to an applicant

is likely to add substantial benefits to

the CDFI industry, above and beyond

what the Fund can expect to accomplish

with its core component. Thus an

applicant having a specialized niche or

niches is important. At the same time,

the Fund is seeking to assist

intermediaries whose potential

customer base has broad applicability.

For example, the Fund does not seek to

provide financial assistance to an

intermediary that has a narrow list of

preselected CDFIs it wishes to finance.

The Fund seeks to finance

intermediaries that have a more openended potential applicant pool and
16464 Federal Register / Vol. 62, No. 65 / Friday, April 4, 1997 / Notices

which will be making an independent

evaluation of each application, based on

criteria specified in the intermediary

applicant’s comprehensive business

plan. Moreover, the Fund may give a

preference to applicants that serve or

expect to serve CDFIs or CDFIs in

formation in a multi-state area or on a

national basis, as opposed to a single

state.

VII. Other Matters

(a) Paperwork Reduction Act. The

reader should refer to the revised

interim rule (12 CFR part 1805)

published separately in today’s Federal

Register for details on the information

collection requirements of the rule and

this Notice.

(b) Environmental Impact. Pursuant to

Treasury Directive 75–02, the

Department of the Treasury has

determined that implementation of the

CDFI Program under the revised interim

rule is categorically excluded from the

National Environmental Policy Act of

1969 (42 U.S.C. 4332) and does not

require an environmental review. The

determination is available for public

inspection between 9:30 a.m. and 4:30

p.m. weekdays at the office of the Fund.

Authority: 12 U.S.C. 4703, 4717: Chapter

X, Pub. L. 104–19, Stat. 237; 12 CFR

1805.700.

Kirsten S. Moy,

Director, Community Development Financial

Institutions Fund.

[FR Doc. 97–8784 Filed 4–2–97; 1:09 pm]

BILLING CODE 4810–70–P