The CDFI Briefing
- Mike Beall, CUDE, Chief Experience Officer
- 2 days ago
- 5 min read
Policy and Legislative Updates for Credit Unions in 2026
February 27, 2026
Latest Update:
Bipartisan AFFORD Act Will Strengthen CDFI Fund
The bipartisan Advancing Financial Opportunities through Revitalizing and Developing CDFIs (AFFORD) Act was introduced this week by Senators Steve Daines (R-MT) and Mark Warner (D-VA), along with 28 additional Senate co-sponsors.
The legislation incorporates elements from several previously introduced bills, and of significant importance to CDFI credit unions is the CDFI Fund Transparency Act (S. 2704), which requires the Secretary of the Treasury to testify annually before the Senate Banking and House Financial Services Committees on CDFI Fund operations. This would create opportunities for more conversations on how the program is operating and to develop ways for it to accomplish even more with the funds it has be appropriated.
We at CU Strategic planning have long encouraged Congress to be aware of the regulatory burdens being created by the CDFI recertification process that create an environment where credit union lose or walk away from the CDFI certification.
As CDFIs are aware, the current requirement is to make 60% of the number of loans and 60% of the dollar amount of loans to their Target Market area. But as things stand, particularly in the current economy, it’s very possible for a CDFI credit union to lend more than 70% of the total number of loans to its target market of Low-Income Targeted Populations and Investment Areas and still not qualify as a CDFI because of the dollar-size of loans to a minority of members who are not in that Target Market.
This transparency requirement and the larger AFFORD act as a whole, is a sign of the important role CDFIs play in America's economy. That bipartisan action in these times must be seen for the way CDFIs bring rural, and urban, Republican and Democrats from across the political spectrum.
February 5, 2026:
CDFI Fund Questions Emerge During Treasury’s House Appearance
Treasury Secretary Scott Bessent appeared before the House Financial Services Committee this week to deliver the annual Financial Stability Oversight Council report, where he faced pointed questions from Rep. Joyce Beatty (D-Ohio) regarding the delayed release of FY 2025 CDFI Fund program awards. In a somewhat testy exchange, Secretary Bessent declined to give a yes-or-no answer on timing.
CU Strategic Planning President Stacy Augustine noted, “Because of Secretary Bessent’s on-the-record support for the CDFI Fund, I’m disappointed that he didn’t use this opportunity to gracefully extricate himself from a heated exchange by simply indicating that appropriated funds would be deployed as soon as they were actually received by Treasury from OMB.”
Many CDFI advocates understand the delay in FY 2025 CDFI Fund awards to stem from the Office of Management and Budget’s failure to apportion congressionally appropriated funds, which must occur before Treasury can move forward. We continue to view Secretary Bessent as a supporter of the CDFI Fund and remain hopeful that OMB will soon release the allocated funds.
February 4, 2026:
Second Shutdown Ends: CDFI Fund Secured for the Year
Yesterday saw the House’s passage and President’s signature of the funding bill that cements funding for 95% of the government through September. This includes the CDFI Fund’s $324 million budget for 2026.
Advocates for the CDFI Fund worked tirelessly throughout 2025 to ensure that the Congress’s historical bipartisan support for the Fund remained strong. As a result, the Fund’s 2026 budget is secure at a level similar to the previous several years. This paves the way for continued appropriations success in 2027.
CDFI credit union leaders were part of that advocacy, such as Southwest Louisiana Credit Union’s CEO Chad Miller. “Over the last several months, Southwest Louisiana CU has worked closely with CU Strategic Planning on sharing the story of small CDFIs like ours to our legislators and I strongly believe that this partnership played a key role in ensuring the future of the Fund.”
The credit union has branches in House Speaker Mike Johnson’s district, and Miller explained, “we were able to talk with several key regional offices of our members legislators, including Speaker Mike Johnson’s office, to share the direct impact that CDFI funds have on low-to-moderate income constituents and small businesses in rural Louisiana.”
Other CDFI credit union leaders expressed their reaction to the bill’s passage as well, with New Orleans Firemen’s FCU CEO Judy DeLucca stating, “We are very pleased that Congress has fully funded the CDFI Fund for 2026. This critical support allows us to continue doing the important work of serving people who deserve access to fair and affordable financial services, and it represents a meaningful win for small credit unions across the country. This is exactly the outcome we hoped for.”
While $334 million is a small portion of the roughly $1.2 trillion bill that is now secure, it means a great deal to the nearly 1,400 certified CDFIs nationwide, roughly a third of which are credit unions. The CDFI Fund is much like the institutions it certifies: relatively small in scale, but capable of delivering outsized impact. In 2024 alone, CDFIs collectively deployed over $24 billion dollars in financing to underserved communities, supporting small businesses, affordable housing, and consumer financial stability in places traditional capital often does not reach. The continued funding of the CDFI Fund ensures that this model can keep working where it’s needed most.
January 29, 2026:
Current Appropriations Standoff Presents No Threat to CDFI Funding
Discussions in the Senate this afternoon are focused on separating Homeland Security funding from the broader FY 2026 spending package in order to move the remaining appropriations bills forward.
The bill containing DHS funding is the sole point of contention, and if the Senate votes on the remaining five bills, they are expected to pass. This includes the Financial Services and General Government (FSGG) appropriations bill, which contains the CDFI Fund’s $324 million budget. If the Senate passes this smaller package as expected, it will need to return to the House for another vote, even though the House is not scheduled to return to session until Monday night.
The good news to keep in mind is that funding for the CDFI Fund is effectively settled at this point. The $324 million figure in the Senate bill keeps the agency on a normal funding track for FY 2026 and helps set up a stable funding outlook heading into FY 2027 and beyond.
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