[Federal Register Volume 63, Number 54 (Friday, March 20, 1998)]
[Notices]
[Pages 13729-13732]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-7153]


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DEPARTMENT OF THE TREASURY

Community Development Financial Institutions Fund
[No. 982-0154]


Notice of Funds Availability (NOFA) Inviting Applications for the 
Community Development Financial Institutions Program--Technical 
Assistance Component

AGENCY: Community Development Financial Institutions Fund, Department 
of the Treasury.

ACTION: Notice of Funds Availability (NOFA) inviting applications.

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SUMMARY: The Community Development Banking and Financial Institutions 
Act of 1994 (12 U.S.C. 4701 et seq.) (hereafter referred to as the 
``Act'') authorizes 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. Such assistance may include 
financial assistance and technical assistance. Technical assistance 
(``TA'') may be used for activities that enhance the capacity of both 
CDFIs and entities proposing to become CDFIs, such as the training of 
management and other personnel, the development of programs, loan or 
investment products, improving financial management and internal 
operations, enhancing a CDFI's community impact, or other activities 
deemed appropriate by the Fund. Since the advent of the CDFI Program, 
the Fund has issued NOFAs inviting applications for both TA and 
financial assistance. However, the Fund recognizes that a key 
ingredient to enhancing the CDFI industry is the provision of TA, and 
the Fund has decided to expand the tools that it utilizes to increase 
the availability of TA to CDFIs. Specifically, the Fund is issuing this 
NOFA for a TA only component of the CDFI Program to better address the 
unmet capacity needs of CDFIs and entities proposing to become CDFIs. 
This NOFA is intended to award grants to eligible applicants that have 
demonstrated capacity needs and have significant potential for 
increasing their community development impact relative to the

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amount of TA provided. This NOFA provides guidance on the contents of 
the necessary application materials and program requirements. Subject 
to funding availability, the Fund intends to award up to $5 million in 
appropriated funds pursuant to this NOFA. The Fund reserves the right 
to award in excess of $5 million in appropriated funds pursuant to this 
NOFA provided that the funds are available and the Fund deems it 
appropriate.

DATES: The original and three copies of the application may be 
submitted at any time following March 20, 1998. The deadline for 
receipt of the original and three copies of an application is 6 p.m. 
EDT on May 29, 1998. Applications received after that date and time 
will not be accepted and will be returned to the sender. Applications 
sent electronically or by facsimile will not be accepted.

ADDRESSES: Applications shall be sent to: Awards Manager, the Community 
Development Financial Institutions Fund, U.S. Department of the 
Treasury, 601 13th St. NW., Suite 200 South, Washington, D.C. 20005.

FOR FURTHER INFORMATION CONTACT: The Technical Assistance Program 
Manager, Community Development Financial Institutions Fund, U.S. 
Department of the Treasury, 601 13th St. NW., Suite 200 South, 
Washington, D.C. 20005, (202) 622-8662. (This is not a toll-free 
number.) If you have any questions about this NOFA or the application 
packet, you may call or write to the Technical Assistance Program 
Manager 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 to (202) 622-7754 a written request 
which includes the name of the requester, organization, mailing 
address, telephone number, facsimile number, and name of the program 
for which an application is being requested.

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 Fund's CDFI 
Program facilitates the creation of a national network of financial 
institutions that are specifically dedicated to community development. 
CDFIs make loans, investments and provide development services to 
economically distressed investment areas and disadvantaged targeted 
populations. In order to facilitate the development of a national 
network of CDFIs, the Fund is seeking to support the efforts of such 
entities to build their organizational capacity to make loans and 
investments and provide development services. In order to use the TA 
funds strategically, it is the Fund's intention to target such funds to 
CDFIs and entities proposing to become CDFIs that have demonstrated 
capacity needs and possess significant potential for increasing their 
community development impact with the assistance of a limited amount of 
TA. The anticipated maximum award per applicant under this NOFA is 
$50,000. However, the Fund, in its sole discretion, reserves the right 
to award amounts in excess of $50,000 if an applicant demonstrates to 
the satisfaction of the Fund the need for such additional amounts and 
the added potential community development impact resulting from such 
additional amounts.
    Elsewhere in this issue of the Federal Register, the Fund is 
publishing an NOFA for financial assistance and TA under the CDFI 
Program core component. That separate NOFA is a continuation of the 
approach used in the first two rounds of the CDFI Program. In the 
separate core component NOFA, the Fund is making available up to $40 
million in appropriated funds. Applicants under that core component 
NOFA may apply for both financial assistance and TA, and such 
applicants for TA are not limited to $50,000 in TA funds. However, all 
applications for financial assistance, TA or both under the core 
component will be evaluated separate and apart from the applications 
under this TA component. Moreover, the application requirements and the 
selection criteria under the core component NOFA differ from those 
contained in this TA component NOFA, because the TA component NOFA is 
singularly focused on providing TA to enhance the capacity of CDFIs and 
entities proposing to become CDFIs. Interested applicants are 
encouraged to apply for TA under one NOFA or the other; however, 
applicants are not prohibited from applying for TA under both NOFAs.

II. Eligibility

    The Act and the interim rule governing the CDFI Program (12 CFR 
part 1805), which was published in the Federal Register on April 4, 
1997 (62 FR 16444), specify the requirements that each applicant must 
meet to be eligible to apply for TA. Specifically, an entity at the 
time it submits its application must meet or propose to meet the CDFI 
certification requirements under Sec. 1805.200. In general, a CDFI must 
have a primary mission of promoting community development, provide 
lending or investments, serve an investment area or a targeted 
population, provide development services, maintain community 
accountability, and be a nongovernment entity. At the time an entity 
submits its application, the entity must be duly organized and validly 
existing under the laws of the jurisdiction in which it is incorporated 
or otherwise established, and is (or within 30 days will be) authorized 
to do business in any jurisdiction in which it proposes to undertake 
activities specified in its application. The details regarding these 
requirements and other program requirements are described in the 
interim rule and the application packet.

III. Form of Assistance

    An applicant under this NOFA may only submit an application for a 
TA grant.

IV. Application Packet

    Section 1805.701 provides that unless otherwise specified in an 
applicable NOFA, each application must contain the information 
specified in the application packet, including the items described in 
Secs. 1805.701(a)-(j). For purposes of this NOFA, the Fund is specially 
tailoring the collection of information requirements. Specifically, 
applicants are only required to submit the information required by the 
TA component application packet. The TA component application packet 
requires the submission of the following information:
    (a) Applicant Information. The applicant's name, address and name 
and telephone number of the applicant's authorized representative and 
contact person.
    (b) Award Request. The dollar amount of the TA grant requested by 
the applicant.
    (c) Eligibility Verification. If the Fund has not certified an 
applicant as a CDFI and an applicant does not have an application for 
certification pending with the Fund, the applicant shall provide 
information necessary to establish that it is, or will be, a CDFI. An 
applicant shall demonstrate whether it meets the CDFI eligibility 
requirements by providing the information described in 
Secs. 1805.701(b)(1)-(8). If an applicant is currently certified by the 
Fund as a CDFI, it may submit a copy of the Fund's letter of 
certification and the Certification of Material Changes form

[[Page 13731]]

contained within the application in lieu of the information described 
in Secs. 1805.701(b)(1)-(8). However, an applicant should include in 
its application for a TA grant information that it believes is 
otherwise relevant to the Fund's evaluation of the application under 
the criteria set forth in this NOFA. An entity that proposes to become 
a CDFI is eligible to apply for a TA grant if the Fund determines that 
such entity's application materials provide a realistic course of 
action to ensure that it will meet the requirements described in 
Secs. 1805.200(b)-(h) within two years of entering into an Assistance 
Agreement with the Fund.
    (d) Comprehensive Business Plan. An applicant shall submit an 
abbreviated five-year Comprehensive Business Plan that addresses the 
items described in this paragraph (d). The Comprehensive Business Plan 
should, to the maximum extent practicable, be limited to ten pages or 
less (applicants may provide attachments, including supplemental 
documents, as appropriate, on items referenced in the Comprehensive 
Business Plan).
    (1) Management capacity. An applicant shall provide a narrative 
description of its current management capacity, including detailed 
information on the background and capacity of the applicant's 
management team, key personnel and governing board members as 
appropriate.
    (2) Track Record and Historical Financial Performance. An applicant 
shall provide information on its historical and current financial 
condition, including a copy of audited financial statements, financial 
statements that have been reviewed by a certified public accountant, or 
financial statements that have been reviewed by the applicant's 
Appropriate Federal Banking Agency for the last three completed fiscal 
years, and the most recent internal financial statements since the 
beginning of the applicant's current fiscal year. The applicant shall 
also provide information on its loans and Development Investments for 
the three most recent fiscal years, including information on the total 
number and dollar amount of such loans and Development Investments 
during each fiscal year during this time frame. If an applicant has 
been in operation for less than three years, the applicant shall 
describe such activities for each fiscal year since inception. The 
applicant shall provide information necessary to assess trends in its 
financial and operating performance (e.g., portfolio delinquencies, 
defaults and charge-offs).
    (3) Market Analysis and Strategy. An applicant shall provide an 
analysis of its target markets, including a description of the needs of 
the Investment Area(s) and Targeted Population(s), as applicable. An 
applicant shall also describe its five-year strategy for meeting the 
demand for loans or Development Investments generated by the needs of 
its target market(s) through its products and services. The strategy 
description may include plans for growth of lending volume and lending 
products, expansion of Development Services, staffing and management 
appropriate to meet such growth and growth of the operating budget. 
Projected changes in overall capital structure (asset and liability 
composition) may also be described. The narrative discussion may be 
supplemented with quantitative projections.
    (4) Coordination Strategy. An applicant shall describe:
    (i) Its plan to coordinate use of assistance from the Fund with 
existing Federal, State, local, and tribal government assistance 
programs and private sector resources;
    (ii) How its proposed activities are consistent with existing 
economic, community, and housing development plans adopted for an 
Investment Area(s) or Targeted Population(s); and
    (iii) How it will coordinate with community organizations, 
financial institutions, and Community Partners (if applicable) which 
will provide loans, equity investments, secondary markets, or other 
services to an Investment Area(s) or a Targeted Population(s).
    (5) Funding Sources. An applicant shall provide information:
    (i) On its current and projected sources of capital and other 
financial support. Such projections should relate to and be consistent 
with the strategy description provided under paragraph (3); and
    (ii) To demonstrate that it has a plan for achieving or maintaining 
financial viability within the five-year period. Such information shall 
demonstrate that the applicant will not be dependent upon future awards 
of assistance from the Fund for its continued viability.
    (6) Community Partnership. In the case of an applicant submitting 
an application with a Community Partner, the applicant shall include in 
its application the information described in Sec. 1805.701(d)(12).
    (e) Technical Assistance Proposal. An applicant shall provide a 
Technical Assistance Proposal (``TAP'') that includes information on 
the TA needed to enhance the capacity of the organization to carry out 
its Comprehensive Business Plan. Such information shall include the 
items described in this paragraph (e). The TAP should, to the maximum 
extent practicable, be limited to ten pages or less (applicants may 
provide attachments, including supplemental documents, as appropriate, 
on items referenced in the TAP). An applicant shall provide:
    (1) An evaluation of its capacity needs (this may be a self-
evaluation);
    (2) A detailed description of the type(s) of TA needed to meet the 
identified capacity needs;
    (3) A detailed description of the strategy for obtaining such TA, 
including its proposed providers of TA and their qualifications. If an 
applicant cannot identify specific providers of TA in its application, 
it shall identify the requisite qualifications that it will seek for 
such TA providers;
    (4) An estimate of the cost to obtain the TA for each year that 
will include use of TA funds. This cost estimate shall include expense 
projections for each of the specific activities to be funded with TA 
funds; and
    (5) A projection of the benefits expected to be created within its 
Investment Area(s) or Targeted Population(s) with the enhanced capacity 
resulting from the TA.
    (f) Conflict of Interest. An applicant shall submit a copy of its 
conflict of interest policies that are consistent with the requirements 
of Sec. 1805.906.
    (g) Lobbying Disclosure Act of 1995. An applicant shall identify 
whether or not the Internal Revenue Service (IRS) has recognized it as 
exempt from Federal income tax under section 501(c)(4) of the Internal 
Revenue Code.
    (h) Miscellaneous. An applicant shall indicate and describe the 
circumstances underlying any back taxes due to the IRS, any delinquent 
debts owed to Federal, State or local governments, and whether it has 
ever filed for bankruptcy.
    (i) Environmental Information. An applicant shall review and 
complete the Environmental Review Form contained within the 
application.
    (j) Applicant Certification. An applicant and Community Partner (if 
applicable) shall review and complete the assurances and certifications 
form contained in Appendix A of the application.
    (k) Previous Awardees. In the case of an applicant that has 
previously received assistance under the CDFI Program, the applicant 
shall demonstrate that it:
    (1) Has substantially met its performance goals and other 
requirements described in its previous Assistance Agreement(s); and

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    (2) Will expand its operations into a new Investment Area(s), serve 
a new Targeted Population(s), offer more products or services, or 
increase the volume of its activities.
    (l) Previous History. In the case of an applicant with a prior 
history of serving Investment Area(s) or Targeted Population(s), the 
applicant shall demonstrate that it:
    (1) Has a record of success in serving Investment Area(s) or 
Targeted Population(s); and
    (2) Will expand its operations into a new Investment Area(s), serve 
a new Targeted Population(s), offer more products or services, or 
increase the volume of its activities.

V. Evaluation and Selection

    In evaluating and selecting applicants, the Fund will utilize the 
evaluation criteria found in Sec. 1805.802(b), except that the Fund 
will not consider the evaluation criteria relating to matching funds in 
Secs. 1805.802(b)(2)(i), (ii), and (iv). Under the Act, the Fund has 
express authority to consider evaluation criteria in addition to those 
set forth in 12 U.S.C. Sec. 4706 and Sec. 1805.802(b). The Fund also 
has broad discretion in evaluating the relative importance of each such 
criterion. For purposes of this TA component NOFA, the Fund is adding 
as a new evaluation criterion the extent of the applicant's 
demonstrated capacity needs. In selecting applicants for TA grant 
awards, the Fund will accord predominant weight to the following two 
evaluation criteria:
    (a) The extent of the applicant's demonstrated capacity needs; and
    (b) The extent and nature of the potential community development 
impact that will be achieved by the Fund's TA, relative to the amount 
of the TA to be provided.
    The Fund will continue to evaluate applications using the remaining 
applicable criteria set forth in Sec. 1805.802(b); however, such 
evaluation criteria will be of secondary importance to the two criteria 
set forth above.
    In assessing the extent of a demonstrated capacity need, the Fund 
will consider the extent of funding previously awarded by the Fund to 
the applicant. While previous awardees are eligible to apply pursuant 
to this NOFA, given the focus on applicants with demonstrated unmet 
capacity building needs, it is the current expectation of the Fund that 
a substantial majority of the funds awarded pursuant to this NOFA will 
be to applicants that are not previous awardees. On the other hand, 
success in a previous funding round will not prevent an applicant from 
receiving a TA grant under this NOFA provided that such a grant is 
consistent with the Act and the interim rule governing the CDFI Program 
(12 CFR part 1805).
    The Fund has sole discretion in the selection of applications for 
assistance. The anticipated maximum award per applicant under this NOFA 
is $50,000. However, the Fund, in its sole discretion, reserves the 
right to award amounts in excess of $50,000 if appropriate.

    Authority: 12 U.S.C. 4703, 4703 note, 4704, 4706, 4707, 4717, 
4718; 12 CFR part 1805.

    Dated: March 16, 1998.
Ellen Lazar,
Director, Community Development Financial Institutions Fund.
[FR Doc. 98-7153 Filed 3-19-98; 8:45 am]
BILLING CODE 4810-70-P