[Federal Register Volume 79, Number 92 (Tuesday, May 13, 2014)]
[Notices]
[Pages 27371-27383]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-10950]


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DEPARTMENT OF THE TREASURY

Community Development Financial Institutions Fund


Funding Opportunity Title: Notice of Guarantee Availability 
(NOGA) Inviting Qualified Issuer Applications and Guarantee 
Applications for the Community Development Financial Institutions 
(CDFI) Bond Guarantee Program

    Announcement Type: Announcement of opportunity to submit Qualified 
Issuer Applications and Guarantee Applications.
    Catalog of Federal Domestic Assistance (CFDA) Number: 21.011.

DATES: Qualified Issuer Applications and Guarantee Applications may be 
submitted to the CDFI Fund starting on the date of publication of this 
NOGA. Applications will be reviewed by the CDFI Fund on an ongoing 
basis, in the order in which they are received or by such other 
criteria that the CDFI Fund may establish and publish, in its sole 
discretion. In order to be considered for the issuance of a Guarantee 
under FY 2014 program authority, Qualified Issuer Applications must be 
submitted by June 23, 2014 and Guarantee Applications must be submitted 
by June 30, 2014. Qualified Issuer Applications and Guarantee 
Applications received in FY 2013 and that were neither withdrawn nor 
declined in FY 2013 will be considered under FY 2014 authority.
    Executive Summary: This NOGA is published in connection with the 
CDFI Bond Guarantee Program, administered by the Community Development 
Financial Institutions Fund (CDFI Fund), the U.S. Department of the 
Treasury (Treasury). The purpose of this NOGA is to notify the public 
that: (i) Parties interested in being approved as Qualified Issuers may 
submit Qualified Issuer Applications and (ii) Qualified Issuers may 
submit Guarantee Applications to be approved for a Guarantee under the 
CDFI Bond Guarantee Program. This NOGA also explains application 
submission and evaluation requirements and processes, agency contacts, 
and information on CDFI Bond Guarantee Program outreach.

I. Guarantee Opportunity Description

    A. Authority; Program summary; Additional reference documents; 
Definitions
    1. Authority. The CDFI Bond Guarantee Program is authorized by the 
Small Business Jobs Act of 2010 (Pub. L. 111-240; 12 U.S.C. 4713a) (the 
Act). Section 1134 of the Act amended the Riegle Community Development 
and Regulatory Improvement Act of 1994 (12 U.S.C. 4701, et seq.) to 
provide authority to the Secretary of the Treasury to establish and 
administer the CDFI Bond Guarantee Program.
    2. Program summary. The purpose of the CDFI Bond Guarantee Program 
is to support CDFI lending by providing Guarantees for Bonds issued for 
Eligible Community or Economic Development Purposes, as authorized by 
section 1134 and 1703 of the Act. The Secretary, as the Guarantor of 
the Bonds, will provide a 100 percent Guarantee for the repayment of 
the Verifiable Principal, Interest, and Call Premium of Bonds issued by 
Qualified Issuers. As the CDFI Bond Guarantee Program has been 
structured, a Qualified Issuer, approved by the CDFI Fund, will issue 
Bonds that will be purchased by the Federal Financing Bank. The 
Qualified Issuer will use Bond Proceeds to provide Bond Loans to 
Eligible CDFIs. The Eligible CDFIs will use Bond Loan proceeds for 
Eligible Community and Economic Development Purposes, including 
providing Secondary Loans to Secondary Borrowers.
    In FY 2014, the Secretary may guarantee Bond Issues having a 
minimum Guarantee of $100 million each up to an aggregate total of $750 
million. The maximum maturity of the Bonds will be 30 years; the Bonds 
will be taxable. The Bonds will support CDFI lending in Investment 
Areas by providing a source of low-cost, long-term capital to CDFIs.
    3. Guarantee availability. Pursuant to this NOGA, the Guarantor may 
provide Guarantees requested by Qualified Issuers in FY 2014, including 
applications that were submitted, but not withdrawn or declined, in FY 
2013. Guarantees will be provided in the order in which Guarantee 
Applications are approved. The review and evaluation of Guarantee 
Applications will be initiated in chronological order by date of 
receipt; however, Guarantee Applications that are incomplete or require 
the CDFI Fund to request additional or clarifying information may delay 
the ability of the CDFI Fund to move the Guarantee Application to the 
next phase of review. Submitting an incomplete Guarantee Application 
earlier than other applicants does not ensure first approval.
    4. Additional reference documents. In addition to this NOGA, the 
CDFI Fund encourages interested parties and applicants to review the 
following documents, which will be posted on the CDFI Bond Guarantee 
Program page of the CDFI Fund's Web site at http://www.cdfifund.gov.
    (a) CDFI Bond Guarantee Program Regulations. The interim rule that 
governs the CDFI Bond Guarantee Program was published on February 5, 
2013 (78 FR 8296; 12 CFR part 1808) (the Regulations) and provides the 
regulatory requirements and parameters for CDFI Bond Guarantee Program 
implementation and administration including general provisions, 
eligibility, eligible activities, applications for Guarantee and 
Qualified Issuer, evaluation and selection, terms and conditions of the 
Guarantee, Bonds, Bond Loans, and Secondary Loans. In addition to the 
Regulations, the CDFI Fund has provided a document that summarizes 
certain program terms and conditions, which may be found on the CDFI 
Fund's Web site.
    (b) Application materials. Details regarding Qualified Issuer 
Application and Guarantee Application content requirements are found in 
this NOGA and the respective applications materials.
    (c) Program documentation. Interested parties should review certain 
CDFI Bond Guarantee Program template documents, which will be used in 
connection with each Guarantee and will be posted on the CDFI Fund's 
Web site for review. Such documents include, among others:
    (i) The Agreement to Guarantee, which describes the roles and 
responsibilities of the Qualified Issuer, will be signed by the 
Qualified Issuer and the Guarantor and will include term sheets as 
appendices that will be signed by each individual Eligible CDFI;
    (ii) The Bond Trust Indenture, which describes responsibilities of 
the Master Servicer/Trustee in overseeing the servicing of the Bonds 
and will be entered into by the Qualified Issuer and the Master 
Servicer/Trustee (selected by the CDFI Fund);
    (iii) The Bond Loan Agreement, which describes the terms and 
conditions of Bond Loans and will be entered into by the Qualified 
Issuer and each Eligible CDFI that receives a Bond Loan;
    (iv) The Bond Purchase Agreement, which describes the terms and 
conditions under which the Bond

[[Page 27372]]

Purchaser will purchase the Bonds issued by the Qualified Issuer and 
will be signed by the Bond Purchaser, the Qualified Issuer, the 
Guarantor and the CDFI Fund. This document also includes the provisions 
for prepayment privileges and the calculation for the prepayment 
discount or premium; and
    (v) The Future Advance Promissory Bond, which will be signed by the 
Qualified Issuer as its promise to repay the Bond Purchaser. This 
document also defines prepayment privileges and includes the 
instructions for prepayment of the Bond.
    The form documents may be updated periodically, as needed, and will 
be tailored, as appropriate, to the particular terms and conditions of 
a Guarantee. Accordingly, the template documents should not be relied 
on, but instead are provided for illustrative purposes.
    (d) Frequently Asked Questions. The CDFI Fund will periodically 
post on its Web site responses to questions that are asked by parties 
interested in the CDFI Bond Guarantee Program.
    5. Definitions. Capitalized terms used herein and not defined 
elsewhere are defined in section 1808.102 of the Regulations.
    B. Coordination with broader community development strategies. 
Consistent with Federal efforts to promote community revitalization, it 
is important for communities to develop a comprehensive neighborhood 
revitalization strategy that addresses neighborhood assets essential to 
transforming distressed neighborhoods into healthy and vibrant 
communities. Neighborhood transformation can best occur when 
comprehensive neighborhood revitalization plans embrace the coordinated 
use of programs and resources that address the interrelated needs 
within a community. Although not a requirement for participating in the 
CDFI Bond Guarantee Program, the Federal Government believes that a 
CDFI will be most successful when it is a part of, and contributes to, 
an area's broader neighborhood revitalization strategy.
    C. Designated Bonding Authority. The CDFI Fund has determined that, 
for purposes of this NOGA, it will not solicit applications from 
entities seeking to serve as a Qualified Issuer in the role of the 
Designated Bonding Authority, pursuant to 12 CFR 1808.201, in FY 2014.
    D. Noncompetitive process. The CDFI Bond Guarantee Program is a 
non-competitive program through which Qualified Issuer Applications and 
Guarantee Applications will undergo a merit-based evaluation (i.e., 
applications will not be scored against each other in a competitive 
manner in which higher ranked applicants are favored over lower ranked 
applicants). Applications will be reviewed by the CDFI Fund on an 
ongoing basis, and Guarantees will be provided in the order in which 
Guarantee Applications are approved or by such other criteria that the 
CDFI Fund may establish and publish, in its sole discretion. However, 
pursuant to the Regulations at 12 CFR 1808.504(c), the Guarantor may 
limit the number of Guarantees made per year or the number of Guarantee 
Applications accepted to ensure that a sufficient examination of 
Guarantee Applications is conducted.
    E. Relationship to other CDFI Fund programs.
    1. Award funds received under any other CDFI Fund Program cannot be 
used by any participant, including Qualified Issuers, Eligible CDFIs, 
and Secondary Borrowers, to pay principal, interest, fees, 
administrative costs, or issuance costs (including Bond Issuance Fees) 
related to the CDFI Bond Guarantee Program, or to fund the Risk-Share 
Pool for a Bond Issue.
    2. Bond Proceeds may only be combined with New Markets Tax Credits 
(NMTC) derived equity (i.e., leveraged loan) to make a Qualified Equity 
Investment (QEI) in a Community Development Entity or to refinance a 
Qualified Low-Income Community Investment (QLICI) at the beginning of 
the seven (7) year NMTC compliance period under the following 
circumstances. If an Eligible CDFI uses Bond Loan proceeds to finance a 
leveraged loan in a NMTC transaction, the Eligible CDFI must provide 
either/both: (1) Additional collateral in the form of Other Pledged 
Loans or Cash Collateral; (2) a payment guarantee or similar credit 
enhancement; and/or (3) other assurances that are approved by Treasury. 
The additional collateral, credit enhancement, and/or assurances must 
remain in force during the entire seven-year NMTC compliance period and 
comply with the Secondary Loan Requirements. These requirements shall 
be part of the draft term sheet and shall be included in the final Bond 
Loan covenants.
    3. Bond Proceeds may not be used to refinance a leveraged loan 
during the seven-year NMTC compliance period. Bond Proceeds may be used 
to refinance a QLICI after the seven-year NMTC compliance period has 
ended so long as all other programmatic requirements are met.
    F. Relationship and interplay with other Federal programs and 
Federal funding.
    1. Eligible CDFIs may not use Bond Loans to refinance existing 
Federal debt or to service debt from other Federal credit programs.
    2. The CDFI Bond Guarantee Program underwriting process will 
include a comprehensive review of the Eligible CDFI's concentration of 
sources of funds available for debt service, including the 
concentration of sources from other Federal programs and level of 
reliance on said sources, to determine the Eligible CDFI's ability to 
service the additional debt.
    G. Contemporaneous application submission. Qualified Issuer 
Applications may be submitted contemporaneously with Guarantee 
Applications; however, the CDFI Fund will review an entity's Qualified 
Issuer Application and make its Qualified Issuer determination prior to 
approving a Guarantee Application.
    H. Other restrictions on use of funds. Bond Proceeds may not be 
used to finance or refinance any trade or business consisting of the 
operation of any private or commercial golf course, country club, 
massage parlor, hot tub facility, suntan facility, racetrack or other 
facility used for gambling, or any store the principal business of 
which is the sale of alcoholic beverages for consumption off-premises. 
Bond Proceeds may not be used to finance or refinance tax-exempt 
obligations or finance or refinance projects that are also financed by 
tax-exempt obligations if: (a) Such financing or refinancing results in 
the direct or indirect subordination of the Bond Loan or Bond Issue to 
the tax-exempt obligations or (b) such financing or refinancing results 
in a corresponding guarantee of the tax-exempt obligation. Qualified 
Issuers and Eligible CDFIs must ensure that any financing made in 
conjunction with tax-exempt obligations comply with CDFI Bond Guarantee 
Program Regulations.

II. General Application Information

    The following requirements apply to all Qualified Issuer 
Applications and Guarantee Applications submitted under this NOGA, as 
well as any Qualified Issuer Applications and Guarantee Applications 
submitted under the FY 2013 NOGA that were neither withdrawn nor 
declined in FY 2013.

A. CDFI Certification Requirements

    1. By statute, the Qualified Issuer applicant must be a Certified 
CDFI or an entity designated by a Certified CDFI to issue Bonds on its 
behalf. However, for the purposes of reviewing Qualified Issuer and 
Guarantee Applications, a Qualified Issuer must receive a

[[Page 27373]]

designation by a separate Certified CDFI to issue Bonds on its behalf. 
Eligible CDFI applicants must be Certified CDFIs as of the date of 
submission of the Guarantee Application. If approved for a Guarantee, 
each Eligible CDFI must be a Certified CDFI as of the Bond Issue Date 
and must maintain its respective CDFI certification throughout the term 
of the corresponding Bond.
    2. A Certified CDFI is an entity that has been certified by the 
CDFI Fund as meeting the CDFI certification requirements set forth in 
12 CFR 1805.201. For purposes of this NOGA, a Certified CDFI is an 
entity that has received official notification from the CDFI Fund that 
it meets all CDFI certification requirements as of the date of 
submission of the associated Qualified Issuer Application and/or 
Guarantee Application, which certification has not expired, and has not 
been notified by the CDFI Fund that its certification has been 
terminated.
    3. The CDFI Fund reserves the right to re-examine the CDFI 
certification status of a Qualified Issuer applicant or an entity that 
wishes to be an Eligible CDFI, and to require that such applicant or 
entity submit a new CDFI certification application in advance of its 
certification expiration date, if applicable.

B. Application Submission

    1. Electronic submission. All Qualified Issuer Applications and 
Guarantee Applications must be submitted electronically through 
myCDFIFund, the CDFI Fund's internet-based interface. Applications sent 
by mail, fax, or other form will not be permitted, except in 
circumstances that the CDFI Fund, in its sole discretion, deems 
acceptable. Please note that Applications will not be accepted through 
Grants.gov.
    2. Applicant identifier numbers. Please note that, pursuant to OMB 
guidance (68 FR 38402), each Qualified Issuer applicant and Guarantee 
applicant must provide, as part of its Application, its Dun and 
Bradstreet Data Universal Numbering System (DUNS) number, as well as 
DUNS numbers for its proposed Program Administrator, its proposed 
Servicer, and each Certified CDFI that is included in the Qualified 
Issuer Application and Guarantee Application. In addition, each 
Application must include a valid and current Employer Identification 
Number (EIN), with a letter or other documentation from the IRS 
confirming the Qualified Issuer applicant's EIN, as well as EINs for 
its proposed Program Administrator, its proposed Servicer, and each 
Certified CDFIs that is included in any Application. An Application 
that does not include such DUNS numbers, EINs and documentation is 
incomplete and will be rejected by the CDFI Fund. Applicants should 
allow sufficient time for the IRS and/or Dun and Bradstreet to respond 
to inquiries and/or requests for the required identification numbers.
    3. System for Award Management (SAM). On July 30, 2012, the Central 
Contractor Registration (CCR) transitioned to SAM. All data in the 
registrant database has been migrated from CCR into SAM. Any entity 
that needs to create a new account or update its current registration 
must register for a user account in SAM. Registering with SAM is 
required for each Qualified Issuer applicant, its proposed Program 
Administrator, its proposed Servicer, and each Certified CDFI that is 
included in any Application. The CDFI Fund will not consider any 
Applications that do not meet the requirement that each entity must be 
properly registered before the date of Application submission. The CDFI 
Fund does not manage the SAM registration process, so entities must 
contact SAM directly for issues related to registration. The CDFI Fund 
strongly encourages all applicants to ensure that their SAM 
registration (and the SAM registration for their Program 
Administrators, Servicers and each Certified CDFI that is included in 
the Qualified Issuer Application and Guarantee Application) is updated 
and that their accounts have not expired. For information regarding SAM 
registration, please visit https://www.sam.gov/sam.
    4. myCDFIFund accounts. Each Qualified Issuer applicant, its 
proposed Program Administrator, its proposed Servicer, and each 
Certified CDFI that is included in the Qualified Issuer Application or 
Guarantee Application must register User and Organization accounts in 
myCDFIFund, the CDFI Fund's Internet-based interface. Each such entity 
must be registered as an Organization and register at least one (1) 
User Account in myCDFIFund in order for any Application to be 
considered complete. As myCDFIFund is the CDFI Fund's primary means of 
communication with applicants with regard to its programs, each such 
entity must make sure that it updates the contact information in its 
myCDFIFund account before any Application is submitted. For more 
information on myCDFIFund, please see the ``Frequently Asked 
Questions'' link posted at https://www.cdfifund.gov/myCDFI/Help/Help.asp.

C. Form of Application

    1. As of the date of this NOGA, the Qualified Issuer Application, 
the Guarantee Application and related application guidance may be found 
on the CDFI Bond Guarantee Program's page on the CDFI Fund's Web site 
at http://www.cdfifund.gov.
    2. Paperwork Reduction Act. Under the Paperwork Reduction Act (44 
U.S.C. chapter 35), an agency may not conduct or sponsor a collection 
of information, and an individual is not required to respond to a 
collection of information, unless it displays a valid OMB control 
number. Pursuant to the Paperwork Reduction Act, the Qualified Issuer 
Application, the Guarantee Application, and the Secondary Loan 
Requirements have been assigned the following control number: 1559-
0044.
    3. Application deadlines. In order to be considered for the 
issuance of a Guarantee under FY 2014 program authority, Qualified 
Issuer Applications must be submitted by June 23, 2014 and Guarantee 
Applications must be submitted by June 30, 2014. Qualified Issuer 
Applications and Guarantee Applications received in FY 2013 and that 
were neither withdrawn nor declined will be considered under FY 2014 
authority.
    4. Format. Detailed Qualified Issuer Application and Guarantee 
Application content requirements are found in the Applications and 
application guidance. The CDFI Fund will read only information 
requested in the Application and reserves the right not to read 
attachments or supplemental materials that have not been specifically 
requested in this NOGA, the Qualified Issuer or the Guarantee 
Application. Supplemental materials or attachments such as letters of 
public support or other statements that are meant to bias or unduly 
influence the Application review process will not be read.
    5. Application revisions. After submitting a Qualified Issuer 
Application or a Guarantee Application, the applicant will not be 
permitted to revise or modify the Application in any way unless 
authorized or requested by the CDFI Fund.
    6. Material changes.
    (a) In the event that there are material changes after the 
submission of a Qualified Issuer Application prior to the designation 
as a Qualified Issuer, the applicant must notify the CDFI Fund of such 
material changes information in a timely and complete manner. The CDFI 
Fund will evaluate such material changes, along with the Qualified 
Issuer Application, to approve or deny the designation of the Qualified 
Issuer.

[[Page 27374]]

    (b) In the event that there are material changes after the 
submission of a Guarantee Application (including, but not limited to, a 
revision of the Capital Distribution Plan or a change in the Eligible 
CDFIs that are included in the application) prior to or after the 
designation as a Qualified Issuer or approval of a Guarantee 
Application or Guarantee, the applicant must notify the CDFI Fund of 
such material changes information in a timely and complete manner. The 
Guarantor will evaluate such material changes, along with the Guarantee 
Application, to approve or deny the Guarantee Application and/or 
determine whether to modify the terms and conditions of the Agreement 
to Guarantee. This evaluation may result in a delay of the approval or 
denial of a Guarantee Application.

D. Eligibility and Completeness Review

    The CDFI Fund will review each Qualified Issuer and Guarantee 
Application to determine whether it is complete and the applicant meets 
eligibility requirements described in the Regulations at 12 CFR 
1808.200 and 1808.401, this NOGA, and the Applications. An incomplete 
Qualified Issuer Application or Guarantee Application, or one that does 
not meet eligibility requirements, will be rejected. If the CDFI Fund 
determines that additional information is needed to assess the 
Qualified Issuer's and/or the Certified CDFIs' ability to participate 
in and comply with the requirements of the CDFI Bond Guarantee Program, 
the CDFI Fund may require that the Qualified Issuer furnish additional, 
clarifying, confirming or supplemental information. If the CDFI Fund 
requests such additional, clarifying, confirming or supplemental 
information, the Qualified Issuer must provide it within the timeframes 
requested by the CDFI Fund. Until such information is provided to the 
CDFI Fund, the Qualified Issuer Application or Guarantee Application 
will not be moved forward for the Substantive Review process. The 
Guarantor shall approve or deny a Guarantee Application no later than 
90 days after the date the Guarantee Application has been advanced for 
Substantive Review.

E. Regulated Entities

    In the case of Qualified Issuer applicants, proposed Program 
Administrators, proposed Servicers and Certified CDFIs that are 
included in the Qualified Issuer Application or Guarantee Application 
that are Insured Depository Institutions and Insured Credit Unions, the 
CDFI Fund will consider information provided by, and views of, the 
Appropriate Federal Banking Agencies. If any such entity is a CDFI bank 
holding company, the CDFI Fund will consider information provided by 
the Appropriate Federal Banking Agencies of the CDFI bank holding 
company and its CDFI bank(s). Throughout the Application review 
process, the CDFI Fund will consult with the Appropriate Federal 
Banking Agency about the applicant's financial safety and soundness. If 
the Appropriate Federal Banking Agency identifies safety and soundness 
concerns, the CDFI Fund will assess whether the concerns cause or will 
cause the applicant to be incapable of undertaking activities related 
to the CDFI Bond Guarantee Program. The CDFI Fund also reserves the 
right to require a regulated applicant to improve safety and soundness 
conditions prior to being approved as a Qualified Issuer or Eligible 
CDFI. In addition, the CDFI Fund will take into consideration Community 
Reinvestment Act assessments of Insured Depository Institutions and/or 
their Affiliates.

F. Prior CDFI Fund Awardees

    All applicants must be aware that success under any of the CDFI 
Fund's programs is not indicative of success under this NOGA. Prior 
CDFI Fund awardees should note the following:
    1. Pending resolution of noncompliance. If a Qualified Issuer 
applicant, its proposed Program Administrator, its proposed Servicer, 
or any of the Certified CDFIs included in the Qualified Issuer 
Application or Guarantee Application, is a prior awardee or allocatee 
under any CDFI Fund program and (i) it has submitted reports to the 
CDFI Fund that demonstrate noncompliance with a previously executed 
agreement with the CDFI Fund, and (ii) the CDFI Fund has yet to make a 
final determination as to whether the entity is in default of its 
previously executed agreement, the CDFI Fund will consider the 
Qualified Issuer Application or Guarantee Application pending full 
resolution, in the sole determination of the CDFI Fund, of the 
noncompliance.
    2. Default status. The CDFI Fund will not consider a Qualified 
Issuer Application or Guarantee Application if the applicant, its 
proposed Program Administrator, its proposed Servicer, or any of the 
Certified CDFIs included in the Qualified Issuer Application or 
Guarantee Application, is a prior awardee or allocatee under any CDFI 
Fund program if, as of the date of Qualified Issuer Application or 
Guarantee Application submission, (i) the CDFI Fund has made a 
determination that such entity is in default of a previously executed 
agreement and (ii) the CDFI Fund has provided written notification of 
such determination to the Qualified Issuer applicant indicating the 
length of time the default status is effective. Such entities will be 
ineligible to submit a Qualified Issuer Application, or be included in 
such submission, as the case may be, so long as the applicant's, its 
proposed Program Administrator's, its proposed Servicer's, or such 
Certified CDFI's prior award or allocation remains in default status or 
such other time period as specified by the CDFI Fund in writing.
    3. Undisbursed award funds. The CDFI Fund will not consider a 
Qualified Issuer Application or Guarantee Application, if the 
applicant, its proposed Program Administrator, its proposed Servicer, 
or any Certified CDFI that is included in the Qualified Issuer 
Application or Guarantee Application, is an awardee under any CDFI Fund 
program and has undisbursed award funds (as defined below) as of the 
Qualified Issuer Application or Guarantee Application submission date. 
The CDFI Fund will include the combined undisbursed prior awards, as of 
the date of the Qualified Issuer Application submission, of the 
applicant, the proposed Program Administrator, the proposed Servicer, 
and any Certified CDFIs included in the application.
    For purposes of the calculation of undisbursed award funds for the 
Bank Enterprise Award (BEA) Program, only awards made to the Qualified 
Issuer applicant, its proposed Program Administrator, its proposed 
Servicer, and any Certified CDFI included in the Qualified Issuer 
Application, three to five calendar years prior to the end of the 
calendar year of the Qualified Issuer Application submission date are 
included. For purposes of the calculation of undisbursed award funds 
for the CDFI Program, the Native American CDFI Assistance (NACA) 
Program, and the Capital Magnet Fund (CMF), only awards made to the 
Qualified Issuer applicant, its proposed Program Administrator, its 
proposed Servicer, and any Certified CDFI included in the Qualified 
Issuer Application, two to five calendar years prior to the end of the 
calendar year of the Qualified Issuer Application submission date are 
included.
    Undisbursed awards cannot exceed five percent of the total 
includable awards for the Applicant's BEA/CDFI/NACA/CMF awards as of 
the date of submission of the Qualified Issuer Application. The 
calculation of

[[Page 27375]]

undisbursed award funds does not include: (i) Tax credit allocation 
authority made available through the New Markets Tax Credit Program; 
(ii) any award funds for which the CDFI Fund received a full and 
complete disbursement request from the awardee by the date of 
submission of the Qualified Issuer Application; (iii) any award funds 
for an award that has been terminated in writing by the CDFI Fund or 
de-obligated by the CDFI Fund; or (iv) any award funds for an award 
that does not have a fully executed assistance or award agreement. The 
CDFI Fund strongly encourages Qualified Issuer applicants, proposed 
Program Administrators, proposed Servicers, and any Certified CDFIs 
included in a Qualified Issuer Application that wish to request 
disbursements of undisbursed funds from prior awards to provide the 
CDFI Fund with a complete disbursement request at least 10 business 
days prior to the date of submission of a Qualified Issuer Application.

G. Contact the CDFI Fund

    A Qualified Issuer applicant, its proposed Program Administrator, 
its proposed Servicer, or any Certified CDFIs included in the Qualified 
Issuer Application or Guarantee Application that are prior CDFI Fund 
awardees are advised to: (i) Comply with requirements specified in CDFI 
Fund assistance, allocation, and/or award agreement(s), and (ii) 
contact the CDFI Fund to ensure that all necessary actions are underway 
for the disbursement or deobligation of any outstanding balance of said 
prior award(s). Any such parties that are unsure about the disbursement 
status of any prior award should contact the CDFI Fund's Senior 
Resource Manager via email at [email protected]. 
All outstanding reports and compliance questions should be directed to 
Certification, Compliance Monitoring, and Evaluation support by email 
at [email protected] or by telephone at (202) 653-0423. The CDFI Fund 
will respond to applicants' reporting, compliance, or disbursement 
questions between the hours of 9:00 a.m. and 5:00 p.m. ET, starting on 
the date of the publication of this NOGA.

H. Evaluating Prior Award Performance

    In the case of a Qualified Issuer, a proposed Program 
Administrator, a proposed Servicer, or Certified CDFI that has received 
awards from other Federal programs, the CDFI Fund reserves the right to 
contact officials from the appropriate Federal agency or agencies to 
determine whether the entity is in compliance with current or prior 
award agreements, and to take such information into consideration 
before issuing a Guarantee. In the case of such an entity that has 
previously received funding through any CDFI Fund program, the CDFI 
Fund will review those entities that have a history of providing late 
reports and consider such history in the context of organizational 
capacity and the ability to meet future reporting requirements.
    The CDFI Fund may also bar from consideration any such entity that 
has, in any proceeding instituted against it in, by, or before any 
court, governmental, or administrative body or agency, received a final 
determination within the last two (2) years indicating that the entity 
has discriminated on the basis of race, color, national origin, 
disability, age, marital status, receipt of income from public 
assistance, religion, or sex, including but not limited to 
discrimination under (i) Title VI of the Civil Rights Act of 1964 (Pub. 
L. 88-352) which prohibits discrimination on the basis of race, color 
or national origin; (ii) Title IX of the Education Amendments of 1972, 
as amended (20 U.S.C. 1681-1683, 1685-1686), which prohibits 
discrimination on the basis of sex; (iii) Section 504 of the 
Rehabilitation Act of 1973, as amended (29 U.S.C. 794), which prohibits 
discrimination on the basis of handicaps; (iv) the Age Discrimination 
Act of 1975, as amended (42 U.S.C. 6101-6107), which prohibits 
discrimination on the basis of age; (v) the Drug Abuse Office and 
Treatment Act of 1972 (Pub. L. 92-255), as amended, relating to 
nondiscrimination on the basis of drug abuse; (vi) the Comprehensive 
Alcohol Abuse and Alcoholism Prevention, Treatment and Rehabilitation 
Act of 1970 (Pub. L. 91-616), as amended, relating to nondiscrimination 
on the basis of alcohol abuse or alcoholism; (vii) Sections 523 and 527 
of the Public Health Service Act of 1912 (42 U.S.C. 290dd-3 and 290ee-
3), as amended, relating to confidentiality of alcohol and drug abuse 
patient records; (viii) Title VIII of the Civil Rights Act of 1968 (42 
U.S.C. 3601 et seq.), as amended, relating to nondiscrimination in the 
sale, rental or financing of housing; (ix) any other nondiscrimination 
provisions in the specific statute(s) under which Federal assistance is 
being made; and (x) the requirements of any other nondiscrimination 
statutes which may apply to the CDFI Bond Guarantee Program.

I. Changes to Review Procedures

    The CDFI Fund reserves the right to change its completeness, 
eligibility and evaluation criteria and procedures if the CDFI Fund 
deems it appropriate. If such changes materially affect the CDFI Fund's 
decision to approve or deny a Qualified Issuer Application, the CDFI 
Fund will provide information regarding the changes through the CDFI 
Fund's Web site.

J. Decisions Are Final

    The CDFI Fund's Qualified Issuer Application decisions are final. 
The Guarantor's Guarantee Application decisions are final. There is no 
right to appeal the decisions. Any applicant that is not approved by 
the CDFI Fund or the Guarantor may submit a new Application and will be 
considered based on the newly submitted Application. Such newly 
submitted Applications will be reviewed along with all other pending 
Applications in the order in which they are received, or by such other 
criteria that the CDFI Fund may establish and publish, in its sole 
discretion.

III. Qualified Issuer Application

    A. General. This NOGA invites interested parties to submit a 
Qualified Issuer Application to be approved as a Qualified Issuer under 
the CDFI Bond Guarantee Program.
    1. Qualified Issuer. The Qualified Issuer is a Certified CDFI, or 
any entity designated by a Certified CDFI to issue Bonds on its behalf, 
that meets the requirements of the Regulations and this NOGA, and that 
has been approved by the CDFI Fund pursuant to review and evaluation of 
its Qualified Issuer Application. The Qualified Issuer will, among 
other duties: (i) Organize the Eligible CDFIs that have designated it 
to serve as their Qualified Issuer; (ii) prepare and submit a complete 
and timely Qualified Issuer and Guarantee Application to the CDFI Fund; 
(iii) if the Qualified Issuer Application is approved by the CDFI Fund 
and the Guarantee Application is approved by the Guarantor, prepare the 
Bond Issue; (iv) manage all Bond Issue servicing, administration, and 
reporting functions; (v) make Bond Loans; (vi) oversee the financing or 
refinancing of Secondary Loans; (vii) ensure compliance throughout the 
duration of the Bond with all provisions of the Regulations, and Bond 
Documents and Bond Loan Documents entered into between the Guarantor, 
the Qualified Issuer, and the Eligible CDFI; and (viii) ensure that the 
Master Servicer/Trustee complies with

[[Page 27376]]

the Bond Trust Indenture and all other applicable regulations.
    2. Qualified Issuer Application. The Qualified Issuer Application 
is the document that an entity seeking to serve as a Qualified Issuer 
submits to the CDFI Fund to apply to be approved as a Qualified Issuer 
prior to consideration of a Guarantee Application.
    3. Qualified Issuer Application evaluation, general. Each Qualified 
Issuer Application will be evaluated by the CDFI Fund and, if 
acceptable, the applicant will be approved as a Qualified Issuer, in 
the sole discretion of the CDFI Fund. The CDFI Fund's Qualified Issuer 
Application review and evaluation process is based on established 
procedures, which may include interviews of applicants and/or site 
visits to applicants conducted by the CDFI Fund. Through the 
Application review process, the CDFI Fund will evaluate Qualified 
Issuer applicants on a merit basis and in a fair and consistent manner. 
Each Qualified Issuer applicant will be reviewed on its ability to 
successfully carry out the responsibilities of a Qualified Issuer 
throughout the life of the Bond. The Applicant must currently meet the 
criteria established in the Regulations to be deemed a Qualified 
Issuer. Qualified Issuer Applications that are forward-looking or 
speculate as to the eventual acquisition of the required capabilities 
and criteria are unlikely to be approved. Qualified Issuer Application 
processing will be initiated in chronological order by date of receipt; 
however, Qualified Applications that are incomplete or require the CDFI 
Fund to request additional or clarifying information may delay the 
ability of the CDFI Fund to deem the Qualified Application complete and 
move it to the next phase of review. Submitting a substantially 
incomplete application earlier than other applicants does not ensure 
first approval.
    B. Qualified Issuer Application: Eligibility.
    1. CDFI certification requirements. The Qualified Issuer applicant 
must be a Certified CDFI or an entity designated by a Certified CDFI to 
issue Bonds on its behalf.
    2. Designation and attestation by Certified CDFIs. An entity 
seeking to be approved by the CDFI Fund as a Qualified Issuer must be 
designated as a Qualified Issuer by at least one Certified CDFI. A 
Qualified Issuer may not designate itself. The Qualified Issuer 
applicant will prepare and submit a complete and timely Qualified 
Issuer Application to the CDFI Fund in accordance with the requirements 
of the Regulations, this NOGA and the Application. A Certified CDFI 
must attest in the Qualified Issuer Application that it has designated 
the Qualified Issuer to act on its behalf and that the information in 
the Qualified Issuer Application regarding it is true, accurate and 
complete.
    C. Substantive review and approval process.
    1. Substantive Review.
    (a) If the CDFI Fund determines that the Qualified Issuer 
Application is complete and eligible, the CDFI Fund will undertake a 
substantive review in accordance with the criteria and procedures 
described in the Regulations, this NOGA, the Qualified Issuer 
Application, and CDFI Bond Guarantee Program policies.
    (b) As part of the substantive evaluation process, the CDFI Fund 
reserves the right to contact the Qualified Issuer applicant (as well 
as its proposed Program Administrator, its proposed Servicer, and each 
designating Certified CDFI in the Qualified Issuer Application) by 
telephone, email, mail, or through on-site visits for the purpose of 
obtaining additional, clarifying, confirming, or supplemental 
application information. The CDFI Fund reserves the right to collect 
such additional, clarifying, confirming, or supplemental information 
from said entities as it deems appropriate. If contacted for 
additional, clarifying, confirming, or supplemental information, said 
entities must respond within the time parameters set by the CDFI Fund 
or the Qualified Issuer Application will be rejected.
    2. Qualified Issuer criteria. In total, there are more than 60 
individual criteria or sub-criteria used to evaluate a Qualified Issuer 
applicant and all materials provided in the Qualified Issuer 
Application will be used to evaluate the applicant. Qualified Issuer 
determinations will be made based on Qualified Issuer applicants' 
experience and expertise, in accordance with the following criteria:
    (a) Organizational capability.
    (i) The Qualified Issuer applicant must demonstrate that it has the 
appropriate expertise, capacity, experience, and qualifications to 
issue Bonds for Eligible Purposes, as well as manage the Bond Issue on 
the terms and conditions set forth in the Regulations, this NOGA, and 
the Bond Documents, satisfactory to the CDFI Fund.
    (ii) The Qualified Issuer applicant must demonstrate that it has 
the appropriate expertise, capacity, and experience to originate, 
underwrite, service and monitor Bond Loans for Eligible Purposes, 
targeted to Low-Income Areas and Underserved Rural Areas.
    (iii) The Qualified Issuer applicant must demonstrate that it has 
the appropriate expertise, capacity, and experience to manage the 
disbursement process set forth in the Regulations at 12 CFR 1808.302 
and 1808.307.
    (b) Servicer. The Qualified Issuer applicant must demonstrate that 
it has (either directly or contractually through another designated 
entity) the appropriate expertise, capacity, and experience, or is 
otherwise qualified to serve as Servicer. The Qualified Issuer 
Application must provide information that demonstrates that the 
Qualified Issuer's Servicer has the expertise and experience necessary 
to perform certain required administrative duties (including, but not 
limited to, Bond Loan servicing functions).
    (c) Program Administrator. The Qualified Issuer applicant must 
demonstrate that it has (either directly or contractually through 
another designated entity) the appropriate expertise, capacity, and 
experience, or is otherwise qualified to serve as Program 
Administrator. The Qualified Issuer Application must provide 
information that demonstrates that the Qualified Issuer's Program 
Administrator has the expertise and experience necessary to perform 
certain required administrative duties (including, but not limited to, 
compliance monitoring and reporting functions).
    (d) Strategic alignment. The Qualified Issuer applicant will be 
evaluated on its strategic alignment with the CDFI Bond Guarantee 
Program on factors that include, but are not limited to: (i) Its 
mission's strategic alignment with community and economic development 
objectives set forth in the Riegle Act at 12 U.S.C. 4701; (ii) its 
strategy for deploying the entirety of funds that may become available 
to the Qualified Issuer through the proposed Bond Issue; (iii) its 
experience providing up to 30-year capital to CDFIs or other borrowers 
in Low-Income Areas or Underserved Rural Areas as such terms are 
defined in the Regulations at 12 CFR 1808.102; (iv) its track record of 
activities relevant to its stated strategy; and (v) other factors 
relevant to the Qualified Issuer's strategic alignment with the 
program.
    (e) Experience. The Qualified Issuer applicant will be evaluated on 
factors that demonstrate that it has previous experience: (i) 
Performing the duties of a Qualified Issuer including making bond 
issuances, loan servicing, program administration, underwriting, 
financial reporting, and loan administration; (ii) lending in Low-
Income Areas and Underserved Rural Areas; and (iii)

[[Page 27377]]

indicating that the Qualified Issuer's current principals and team 
members have successfully performed the required duties, and that 
previous experience is applicable to the current principals and team 
members.
    (f) Management and staffing. The Qualified Issuer applicant must 
demonstrate that it has sufficiently strong management and staffing 
capacity to undertake the duties of Qualified Issuer. The applicant 
must also demonstrate that its proposed Program Administrator and its 
proposed Servicer have sufficiently strong management and staffing 
capacity to undertake their respective requirements under the CDFI Bond 
Guarantee Program. Strong management and staffing capacity is evidenced 
by factors that include, but are not limited to: (i) A sound track 
record of delivering on past performance; (ii) a documented succession 
plan; (iii) organizational stability including staff retention; and 
(iv) a clearly articulated, reasonable and well-documented staffing 
plan.
    (g) Financial strength. The Qualified Issuer applicant must 
demonstrate the strength of its financial capacity and activities 
including, among other items, financially sound business practices 
relative to the industry norm for bond issuers, as evidenced by reports 
of Appropriate Federal Banking Agencies, Appropriate State Agencies, or 
auditors. Such financially sound business practices will demonstrate: 
(i) The financial wherewithal to perform activities related to the Bond 
Issue such as administration and servicing; (ii) the ability to 
originate, underwrite, close, and disburse loans in a prudent manner; 
(iii) whether the applicant is depending on external funding sources 
and the reliability of long-term access to such funding; (iv) whether 
there are foreseeable counterparty issues or credit concerns that are 
likely to affect the applicant's financial stability; and (v) a budget 
that reflects reasonable assumptions about upfront costs as well as 
ongoing expenses and revenues.
    (h) Systems and information technology. The Qualified Issuer 
applicant must demonstrate that it (as well as its proposed Program 
Administrator and its proposed Servicer) has, among other things: (i) A 
strong information technology capacity and the ability to manage loan 
servicing, administration, management and document retention; (ii) 
appropriate office infrastructure and related technology to carry out 
the CDFI Bond Guarantee Program activities; and (iii) sufficient backup 
and disaster recovery systems to maintain uninterrupted business 
operations.
    (i) Pricing structure. The Qualified Issuer applicant must provide 
its proposed pricing structure for performing the duties of Qualified 
Issuer, including the pricing for the roles of Program Administrator 
and Servicer. Although the pricing structure and fees shall be decided 
by negotiation between market participants without interference or 
approval by the CDFI Fund, the CDFI Fund will evaluate whether the 
Qualified Issuer applicant's proposed pricing structure is feasible to 
carry out the responsibilities of a Qualified Issuer over the life of 
the Bond and sound implementation of the program.
    (j) Other criteria. The Qualified Issuer applicant must meet such 
other criteria as may be required by the CDFI Fund, as set forth in the 
Qualified Issuer Application or required by the CDFI Fund in its sole 
discretion, for the purposes of evaluating the merits of a Qualified 
Issuer Application. The CDFI Fund may request an on-site review of 
Qualified Issuer applicant to confirm materials provided in the written 
application, as well as to gather additional due diligence information. 
The on-site reviews are a critical component of the application review 
process and will generally be conducted for all applicants not 
regulated by an Appropriate Federal Banking Agency or Appropriate State 
Agency. The CDFI Fund reserves the right to conduct a site visit of 
regulated entities, in its sole discretion.
    (k) Third-party data sources. The CDFI Fund, in its sole 
discretion, may consider information from third-party sources 
including, but not limited to, periodicals or publications, publicly 
available data sources, or subscriptions services for additional 
information about the Qualified Issuer applicant, the proposed Program 
Administrator, the proposed Servicer and each Certified CDFI that is 
included in the Qualified Issuer Application. Any additional 
information received from such third-party sources will be reviewed and 
evaluated through a systematic and formalized process.
    D. Notification of Qualified Issuer determination. Each Qualified 
Issuer applicant will be informed of the CDFI Fund's decision in 
writing, by email using the addresses maintained in the entity's 
myCDFIFund account. The CDFI Fund will not notify the proposed Program 
Administrator, the proposed Servicer, or the Certified CDFIs included 
in the Qualified Issuer Application of its decision regarding the 
Qualified Issuer Application; such contacts are the responsibility of 
the Qualified Issuer applicant.
    E. Qualified Issuer Application rejection. In addition to 
substantive reasons based on the merits of its review, the CDFI Fund 
reserves the right to reject a Qualified Issuer Application if 
information (including administrative errors) comes to the attention of 
the CDFI Fund that adversely affects an applicant's eligibility, 
adversely affects the CDFI Fund's evaluation of a Qualified Issuer 
Application, or indicates fraud or mismanagement on the part of a 
Qualified Issuer applicant or its proposed Program Administrator, its 
proposed Servicer, and any Certified CDFI included in the Qualified 
Issuer Application. If the CDFI Fund determines that any portion of the 
Qualified Issuer Application is incorrect in any material respect, the 
CDFI Fund reserves the right, in its sole discretion, to reject the 
Application.

IV. Guarantee Applications

    A. General. This NOGA invites Qualified Issuers to submit a 
Guarantee Application to be approved for a Guarantee under the CDFI 
Bond Guarantee Program.
    1. Guarantee Application.
    (a) The Guarantee Application is the application document that a 
Qualified Issuer (in collaboration with the Eligible CDFIs that seek to 
be included in the proposed Bond Issue) must submit to the CDFI Fund in 
order to apply for a Guarantee. The Qualified Issuer shall provide all 
required information in its Guarantee Application to establish that it 
meets all criteria set forth in the Regulations at 12 CFR 1808.501 and 
this NOGA and can carry out all CDFI Bond Guarantee Program 
requirements including, but not limited to, information that 
demonstrates that the Qualified Issuer has the appropriate expertise, 
capacity, and experience and is qualified to make, administer and 
service Bond Loans for Eligible Purposes.
    (b) The Guarantee Application comprises a Capital Distribution Plan 
and at least one Secondary Capital Distribution Plan, as well as all 
other requirements set forth in this NOGA or as may be required by the 
Guarantor and the CDFI Fund in their sole discretion, for the 
evaluation and selection of Guarantee applicants.
    2. Guarantee Application evaluation, general. The Guarantee 
Application review and evaluation process will be based on established 
standard procedures, which may include interviews of applicants and/or 
site visits to applicants conducted by the CDFI Fund. Through the 
Application review process, the CDFI Fund will evaluate Guarantee 
applicants on a

[[Page 27378]]

merit basis and in a fair and consistent manner. Each Guarantee 
applicant will be reviewed on its ability to successfully implement and 
carry out the activities proposed in its Guarantee Application 
throughout the life of the Bond. Eligible CDFIs must currently meet the 
criteria established in the Regulations to participate in the CDFI Bond 
Guarantee Program. Guarantee Applications that are forward-looking or 
speculate as to the eventual acquisition of the required capabilities 
and criteria by the Eligible CDFI(s) are unlikely to be approved. 
Guarantee Application processing will be initiated in chronological 
order by date of receipt; however, Guarantee Applications that are 
incomplete or require the CDFI Fund to request additional or clarifying 
information may delay the ability of the CDFI Fund to deem the 
Guarantee Application complete and move it to the next phase of review. 
Submitting a substantially incomplete application earlier than other 
applicants does not ensure first approval.
    B. Guarantee Application: eligibility.
    1. Eligibility; CDFI certification requirements. Each Eligible CDFI 
must be a Certified CDFI as of the date of submission of a Guarantee 
Application. If approved for a Guarantee, each Eligible CDFI must be a 
Certified CDFI as of the Bond Issue Date and must maintain its 
respective CDFI certification throughout the term of the corresponding 
Bond. For more information on CDFI Certification see part II of this 
NOGA.
    2. Qualified Issuer as Eligible CDFI. A Qualified Issuer may not 
participate as an Eligible CDFI within its own Bond Issue, but may 
participate as an Eligible CDFI in a Bond Issue managed by another 
Qualified Issuer.
    3. Attestation by proposed Eligible CDFIs. Each proposed Eligible 
CDFI must attest in the Guarantee Application that it has designated 
the Qualified Issuer to act on its behalf and that the information 
pertaining to the Eligible CDFI in the Guarantee Application is true, 
accurate and complete. Each proposed Eligible CDFI must also attest in 
the Guarantee Application that it will use Bond Loan proceeds for 
Eligible Purposes and that Secondary Loans will be financed or 
refinanced only within the applicable Secondary Loan Requirements.
    C. Guarantee Application: preparation. When preparing the Guarantee 
Application, the Eligible CDFIs and Qualified Issuer must collaborate 
to determine the composition and characteristics of the Bond Issue, 
ensuring compliance with the Act, the Regulations, and this NOGA. The 
Qualified Issuer is responsible for the collection, preparation, 
verification and submission of the Eligible CDFI information that is 
presented in the Guarantee Application. The Qualified Issuer will 
submit the Guarantee Application for the proposed Bond Issue, including 
any information provided by the proposed Eligible CDFIs. In addition, 
the Qualified Issuer will serve as the primary point of contact with 
the CDFI Fund during the Guarantee Application review and evaluation 
process.
    D. Review and approval process.
    1. Substantive review.
    (a) If the CDFI Fund determines that the Guarantee Application is 
complete and eligible, the CDFI Fund will undertake a Substantive 
Review in accordance with the criteria and procedures described in the 
Regulations at 12 CFR 1808.501, this NOGA, and the Guarantee 
Application. The Substantive Review of the Guarantee Application will 
include due diligence, underwriting, credit risk review and Federal 
credit subsidy calculation in order to determine the feasibility and 
risk of the proposed Bond Issue, as well as the strength and capacity 
of the Qualified Issuer and each proposed Eligible CDFI. Each proposed 
Eligible CDFI will be evaluated independently of the other proposed 
Eligible CDFIs within the proposed Bond Issue.
    (b) As part of the Substantive Review process, the CDFI Fund may 
contact the Qualified Issuer (as well as the proposed Eligible CDFIs 
included in the Guarantee Application) by telephone, email, mail, or 
through an on-site visit for the sole purpose of obtaining additional, 
clarifying, confirming, or supplemental application information. The 
CDFI Fund reserves the right to collect such additional, clarifying, 
confirming or supplemental information as it deems appropriate. If 
contacted for additional, clarifying, confirming, or supplemental 
information, said entities must respond within the time parameters set 
by the CDFI Fund or the Guarantee Application will be rejected.
    2. Guarantee Application criteria.
    (a) In general, a Guarantee Application will be evaluated based on 
the strength and feasibility of the proposed Bond Issue, as well as the 
creditworthiness and performance of the Qualified Issuer and the 
proposed Eligible CDFIs. Guarantee Applications must demonstrate that 
each proposed Eligible CDFI has the capacity for its respective Bond 
Loan to be a general recourse obligation of the proposed Eligible CDFI 
and to deploy the Bond Loan proceeds within the required disbursement 
timeframe as described in the Regulations. Unless receiving significant 
third-party support or Credit Enhancements, Eligible CDFIs should not 
request Bond Loans greater than their current total asset size or which 
would otherwise significantly impair their net asset or net equity 
position. Further, unless receiving significant third-party support or 
Credit Enhancements, entities with a limited operating history or a 
history of operating losses are unlikely to meet the strength and 
feasibility requirements of the CDFI Bond Guarantee Program.
    (b) The Capital Distribution Plan must demonstrate the Qualified 
Issuer's comprehensive plan for lending, disbursing, servicing and 
monitoring each Bond Loan in the Bond Issue. It includes, among other 
information, the following components:
    (i) Statement of Proposed Sources and Uses of Funds: Pursuant to 
the requirements set forth in the Regulations at 12 C.R1808.102(bb) and 
1808.301, the Qualified Issuer must provide: (A) A description of the 
overall plan for the Bond Issue; (B) a description of the proposed uses 
of Bond Proceeds and proposed sources of funds to repay principal and 
interest on the proposed Bond and Bond Loans; (C) a certification that 
100 percent of the principal amounts of the proposed Bond will be used 
to make Bond Loans for Eligible Purposes on the Bond Issue Date; and 
(D) description of the extent to which the proposed Bond Loans will 
serve Low-Income Areas or Underserved Rural Areas;
    (ii) Bond Issue Qualified Issuer cash flow model: The Qualified 
Issuer must provide a cash flow model displaying the orderly repayment 
of the Bond and the Bond Loans according to their respective terms. The 
cash flow model shall include disbursement and repayment of Bonds, Bond 
Loans, and Secondary Loans. The cash flow model shall match the 
aggregated cash flows from the Secondary Capital Distribution Plans of 
each of the underlying Eligible CDFIs in the Bond Issue pool;
    (iii) Organizational capacity: If not submitted concurrently, the 
Qualified Issuer must attest that no material changes have occurred 
since the time that it submitted the Qualified Issuer Application;
    (iv) Credit Enhancement (if applicable): The Qualified Issuer must 
provide information about the adequacy of proposed risk mitigation 
provisions designed to protect the financial interests of the Federal 
Government, either directly or indirectly through supporting the 
financial strength of the Bond Issue. This includes, but is not limited 
to, the amount and quality of

[[Page 27379]]

any Credit Enhancements, terms and specific conditions such as renewal 
options, and any limiting conditions or revocability by the provider of 
the Credit Enhancement;
    (v) Proposed Term Sheets: For each Eligible CDFI that is part of 
the proposed Bond Issue, the Qualified Issuer must submit a proposed 
Term Sheet using the template provided on the CDFI Fund's Web site. The 
proposed Term Sheet must clearly state all relevant and critical terms 
of the proposed Bond Loan including, but not limited to: any requested 
prepayment provisions; unique conditions precedent; proposed covenants 
and exact calculations for determining compliance, and terms and exact 
language describing any Credit Enhancements.
    (vi) Secondary Capital Distribution Plan(s): Each proposed Eligible 
CDFI must provide a comprehensive plan for financing, disbursing, 
servicing and monitoring Secondary Loans, how each proposed Secondary 
Loan will meet Eligible Purposes, and such other requirements that may 
be required by the Guarantor and the CDFI Fund, including:
    (A) Narrative and Statement of Proposed Sources and Uses of Funds: 
Each Eligible CDFI will: (1) Provide a description of proposed uses of 
funds, including the extent to which Bond Loans will serve Low-Income 
Areas or Underserved Rural Areas, and the extent to which Bond Loan 
proceeds will be used (i) to make the first monthly installment of a 
Bond Loan payment, (ii) pay Issuance Fees up to one percent of the Bond 
Loan, and (iii) finance Loan Loss Reserves related to Secondary Loans; 
(2) attest that 100 percent of Bond Loan proceeds designated for 
Secondary Loans will be used to finance or refinance Secondary Loans 
that meet Secondary Loan Requirements; (3) describe a plan for 
financing, disbursing, servicing, and monitoring Secondary Loans; (4) 
indicate the expected asset classes to which it will lend under the 
Secondary Loan Requirements; (5) indicate examples of previous lending 
and years of experience lending to a specific asset class; (6) provide 
a table detailing specific uses and timing of disbursements, including 
terms and relending plans if applicable; and (7) a community impact 
analysis, including how the proposed Secondary Loans will address 
financing needs that the private market is not adequately serving and 
specific community benefit metrics;
    (B) Eligible CDFI cash flow model: Each Eligible CDFI must provide 
a cash flow model of the proposed Bond Loan which: (1) Matches each 
Eligible CDFI's portion of the Qualified Issuer's cash flow model; and 
(2) tracks the flow of funds through the term of the Bond Issue and 
demonstrates disbursement and repayment of the Bond Loan, Secondary 
Loans, and any utilization of the Relending Fund, if applicable;
    (C) Organizational capacity: Each Eligible CDFI must provide 
documentation indicating the ability of the Eligible CDFI to manage its 
Bond Loan including, but not limited to: (1) Organizational ownership 
and chart of affiliates; (2) organizational documents; (3) management 
or operating agreement, if applicable; (4) an analysis by management of 
its ability to manage the funding, monitoring, and collection of loans 
being contemplated with the proceeds of the Bond Loan; (5) information 
about its board of directors; (6) a governance narrative; (7) 
description of senior management and employee base; (8) independent 
reports, if available; (9) strategic plan or related progress reports; 
and (10) a discussion of the management and information systems used by 
the Eligible CDFI;
    (D) Policies and procedures: Each Eligible CDFI must provide 
policies and procedures for the matching of assets and liabilities, as 
well as loan policies and procedures: a copy of the asset-liability 
matching policy, if applicable; and loan policies which address topics 
including, but not limited to: (1) Origination, underwriting, credit 
approval, interest rates, closing, documentation, and portfolio 
monitoring and (2) risk-rating definitions, charge-offs, and loan loss 
reserve methodology;
    (E) Financial statements: Each Eligible CDFI must provide 
information about the Eligible CDFI's current and future financial 
position, including but not limited to: (1) Most recent three years of 
audited financial statements; (2) current year-to-date or interim 
financial statement; (3) a copy of the current year's approved budget; 
and (4) a three year operating projection;
    (F) Loan portfolio information: Each Eligible CDFI must provide 
information such as: (1) Loan portfolio quality report; (2) pipeline 
report; (3) portfolio listing; (4) a description of other loan assets 
under management; (5) loan products; (6) independent loan review 
report; (7) impact report case studies; and (8) a loan portfolio by 
risk rating and loan loss reserves; and
    (G) Funding sources and financial activity information: Each 
Eligible CDFI must provide information including, but not limited to: 
(1) Current grant information; (2) funding projections; (3) credit 
enhancements; (4) historical investor renewal rates; (5) covenant 
compliance; (6) off-balance sheet contingencies; (7) earned revenues; 
and (8) debt capital statistics.
    (vii) Assurances and certifications that not less than 100 percent 
of the principal amount of Bonds will be used to make Bond Loans for 
Eligible Purposes beginning on the Bond Issue Date, and that Secondary 
Loans shall be made as set forth in subsection 1808.307(b); and
    (viii) Such other information that the Guarantor, the CDFI Fund 
and/or the Bond Purchaser may deem necessary and appropriate.
    (c) The CDFI Fund will use the information described in the Capital 
Distribution Plan and Secondary Capital Distribution Plan(s) to 
evaluate the feasibility of the proposed Bond Issue, with specific 
attention paid to each Eligible CDFI's financial strength and 
organizational capacity. All materials provided in the Guarantee 
Application will be used to evaluate the proposed Bond Issue. In total, 
there are more than 100 individual criteria or sub-criteria used to 
evaluate each Eligible CDFI. Specific criteria used to evaluate each 
Eligible CDFI shall include, but not be limited to:
    (i) Historical financial ratios: Ratios which together have been 
shown to be predictive of possible future default will be used an 
initial screening tool, including total asset size, net asset or Tier 1 
Core Capital ratio, self-sufficiency ratio, non-performing asset ratio, 
liquidity ratio, reserve over nonperforming assets, and yield cost 
spread;
    (ii) Quantitative and qualitative attributes under the ``CAMEL'' 
framework: After initial screening, the CDFI Fund will utilize a more 
detailed analysis under the ``CAMEL'' framework including but not 
limited to:
    (A) Capital Adequacy: Attributes such as the debt-to-equity ratio, 
status and significance of off-balance sheet liabilities or 
contingencies, magnitude and consistency of cash flow performance, 
exposure to affiliates for financial and operating support, trends in 
changes to capitalization, and other relevant attributes;
    (B) Asset Quality: Attributes such as the charge-off ratio, 
adequacy of loan loss reserves, sector concentration, borrower 
concentration, asset composition, security and collateralization of the 
loan portfolio, trends in changes to asset quality, and other relevant 
attributes;
    (C) Management: Attributes such as documented best practices in 
governance, strategic planning and board involvement, robust policies 
and

[[Page 27380]]

procedures, tenured and experienced management team, organizational 
stability, infrastructure and information technology systems, and other 
relevant attributes;
    (D) Earnings and Performance: Attributes such as net operating 
margins, deployment of funds, self-sufficiency, trends in earnings, and 
other relevant attributes;
    (E) Liquidity: Attributes such as unrestricted cash and cash 
equivalents, ability to access credit facilities, access to grant 
funding, covenant compliance, affiliate relationships, concentration of 
funding sources, trends in liquidity, and other relevant attributes;
    (iii) Forecast performance and other relevant criteria: The CDFI 
Fund will stress test each Eligible CDFI's forecasted performance under 
scenarios that are specific to the unique circumstance and attributes 
of the organization. Additionally, the CDFI Fund will consider other 
relevant criteria that have not been adequately captured in the 
preceding steps as part of the due diligence process. Such criteria may 
include, but not be limited to, the size and quality of any third-party 
Credit Enhancements or other forms of support.
    (A) Overcollateralization: The commitment by an Eligible CDFI to 
over-collateralize a proposed Bond Loan with excess Secondary Loans is 
a criterion that may affect the viability of a Guarantee Application by 
decreasing the estimated net present value of the long-term cost of the 
Guarantee to the Federal Government, by decreasing the probability of 
default, and/or increasing the recovery rate in the event of default. 
An Eligible CDFI committing to overcollateralization may not be 
required to deposit funds in the Relending Account, subject to the 
maintenance of certain unique requirements that are detailed in the 
template Agreement to Guarantee and Bond Loan Agreement;
    (B) Credit Enhancements: The provision of third-party Credit 
Enhancements is a criterion that may affect the viability of a 
Guarantee Application by decreasing the estimated net present value of 
the long-term cost of the Guarantee to the Federal Government. Credit 
Enhancements are considered in the context of the structure and 
circumstances of each Guarantee Application;
    (C) On-Site Review: The CDFI Fund may request an on-site review of 
an Eligible CDFI to confirm materials provided in the written 
application, as well as to gather additional due diligence information. 
The on-site reviews are a critical component of the application review 
process and will generally be conducted for all applicants not 
regulated by an Appropriate Federal Banking Agency or Appropriate State 
Agency. The CDFI Fund reserves the right to conduct a site visit of 
regulated entities, in its sole discretion.
    (D) Secondary Loan Asset Classes: Eligible CDFIs that propose to 
use funds for new products or lines of business must demonstrate that 
they have the organizational capacity to manage such activities in a 
prudent manner. Failure to demonstrate such organizational capacity may 
be factored into the consideration of Asset Quality or Management 
criteria as listed above in this section.
    3. Credit subsidy cost. The credit subsidy cost is the net present 
value of the estimated long-term cost of the Guarantee to the Federal 
Government as determined under the applicable provisions of the Federal 
Credit Reform Act of 1990, as amended (FCRA). Treasury has not received 
appropriated amounts from Congress to cover the credit subsidy costs 
associated with the Guarantees issued pursuant to this NOGA. In 
accordance with FCRA, Treasury must consult with, and obtain the 
approval of, OMB for Treasury's calculation of the credit subsidy cost 
of each Guarantee prior to entering into any Agreement to Guarantee.
    E. Guarantee approval.
    1. The Guarantor, in the Guarantor's sole discretion, may approve a 
Guarantee, in consideration of the recommendation from the CDFI Bond 
Guarantee Program's Credit Review Board and/or based on the merits of 
the Guarantee Application. The Guarantor shall approve or deny a 
Guarantee Application no later than 90 days after the date the 
Guarantee Application has been advanced for Substantive Review.
    2. The Guarantor reserves the right to approve Guarantees, in whole 
or in part, in response to any, all, or none of the Guarantee 
Applications submitted in response to this NOGA. The Guarantor also 
reserves the right to approve Guarantees in amounts that are less than 
requested in a Guarantee Application. Pursuant to the Regulations at 12 
CFR 1808.504(c), the Guarantor may limit the number of Guarantees made 
per year to ensure that a sufficient examination of Guarantee 
Applications is conducted.
    3. The CDFI Fund will notify the Qualified Issuer in writing of the 
Guarantor's approval or disapproval of a Guarantee Application. If 
approved for a Guarantee, the Qualified Issuer will enter into an 
Agreement to Guarantee, which will include terms and conditions that 
will be signed by each Eligible CDFI. Following the execution of the 
Agreement to Guarantee, the parties will proceed to the Bond Issue 
Date, when the parties will sign the remaining Bond Documents.
    4. The Guarantee shall not be effective until the Guarantor signs 
and delivers the Guarantee.
    F. Guarantee denial. The Guarantor, in the Guarantor's sole 
discretion, may deny a Guarantee, in consideration of the 
recommendation from the Credit Review Board and/or based on the merits 
of the Guarantee Application. In addition, the Guarantor reserves the 
right to deny a Guarantee Application if information (including 
administrative errors) comes to the Guarantor's attention that 
adversely affects the Qualified Issuer's eligibility, adversely affects 
the evaluation or scoring of an Application, or indicates fraud or 
mismanagement on the part of the Qualified Issuer, Program 
Administrator, Servicer, and/or Eligible CDFIs. Further, if the 
Guarantor determines that any portion of the Guarantee Application is 
incorrect in any material respect, the Guarantor reserves the right, in 
the Guarantor's sole discretion, to deny the Application.

V. Guarantee Administration

    A. Pricing information. Bond Loans will be priced based upon the 
underlying Bond issued by the Qualified Issuer and purchased by the 
Federal Financing Bank (FFB or Bond Purchaser). The FFB will set the 
liquidity premium at the time of the Bond Issue Date, based on the 
duration and maturity of the Bonds according to the FFB's lending 
policies (www.treasury.gov/ffb). Liquidity premiums will be charged in 
increments of 1/8th of a percent (i.e., 12.5 basis points).
    B. Fees and other payments. The following table includes some of 
the fees that may be applicable to Qualified Issuers and Eligible CDFIs 
after approval of a Guarantee of a Bond Issue, as well as Risk-Share 
Pool funding, prepayment penalties or discounts, and Credit 
Enhancements. The table is not exhaustive; additional fees payable to 
the CDFI Fund or other parties may apply.

[[Page 27381]]



------------------------------------------------------------------------
                Fee                              Description
------------------------------------------------------------------------
Agency Administrative Fee.........  Payable annually to the CDFI Fund by
                                     the Qualified Issuer. Equal to 10
                                     basis points on the amount of the
                                     unpaid principal of the Bond Issue.
Bond Issuance Fees................  Amounts paid by an Eligible CDFI for
                                     reasonable and appropriate
                                     expenses, administrative costs, and
                                     fees for services in connection
                                     with the issuance of the Bond (but
                                     not including the Agency
                                     Administrative Fee) and the making
                                     of the Bond Loan. Bond Issuance
                                     Fees negotiated between the
                                     Qualified Issuer and the Eligible
                                     CDFI. Up of 1% of Bond Loan
                                     Proceeds may be used to finance the
                                     Bond Issuance Fee.
Servicer fee......................  The fees paid by the Eligible CDFI
                                     to the Qualified Issuer's Servicer.
                                     Servicer fees negotiated between
                                     the Qualified Issuer and the
                                     Eligible CDFI.
Program Administrator fee.........  The fees paid by the Eligible CDFI
                                     to the Qualified Issuer's Program
                                     Administrator. Program
                                     Administrator fees negotiated
                                     between the Qualified Issuer and
                                     the Eligible CDFI.
Master Servicer/Trustee fee.......  The fees paid by the Qualified
                                     Issuer and the Eligible CDFI to the
                                     Master Servicer/Trustee to carry
                                     out the responsibilities of the
                                     Bond Trust Indenture. In general,
                                     the Master Servicer/Trustee fee is
                                     the greater of 16 basis points per
                                     annum or $10,000 per month once the
                                     Bond Loans are fully disbursed. Any
                                     special servicing costs and
                                     resolution or liquidation fees due
                                     to a Bond Loan default are the
                                     responsibility of the Eligible
                                     CDFI. Please see the template legal
                                     documents at www.cdfifund.gov/bond
                                     for more specific information.
Risk-Share Pool funding...........  The funds paid by the Eligible CDFIs
                                     to cover Risk-Share Pool
                                     requirements; capitalized by pro
                                     rata payments equal to 3% of the
                                     amount disbursed on the Bond from
                                     all Eligible CDFIs within the Bond
                                     Issue.
Prepayment penalties or discounts.  Prepayment penalties or discounts
                                     may be determined by the FFB at the
                                     time of prepayment.
Credit Enhancements...............  Pledges made to enhance the quality
                                     of a Bond and/or Bond Loan. Credit
                                     Enhancements include, but are not
                                     limited to, the Principal Loss
                                     Collateral Provision and letters of
                                     credit.
------------------------------------------------------------------------

    C. Annual assessment. In accordance with 12 CFR 1808.302(f), each 
year, beginning on the one year anniversary of the Bond Issue Date (and 
every year thereafter for the term of the Bond Issue), each Qualified 
Issuer must demonstrate that not less than 100 percent of the principal 
amount of the Guaranteed Bonds currently disbursed and outstanding has 
been used to make loans to Eligible CDFIs for Eligible Purposes. If a 
Qualified Issuer fails to demonstrate this requirement within the 90 
days after the anniversary of the Bond Issue Date, the Qualified Issuer 
must repay on that portion of Bonds necessary to bring the Bonds that 
remain outstanding after such repayment into compliance with the 100 
percent requirement above.
    D. Secondary Loan Requirements. In accordance with the Regulations, 
Eligible CDFIs must finance or refinance Secondary Loans for Eligible 
Purposes (not including loan loss reserves) that align with Secondary 
Loan Requirements. The Secondary Loan Requirements are found on the 
CDFI Fund's Web site at www.cdfifund.gov. Applicants should become 
familiar with the published Secondary Loan Requirements. Secondary Loan 
Requirements are classified by asset class and are subject to a 
Secondary Loan commitment process managed by the Qualified Issuer.
    Eligible CDFIs must execute Secondary Loans documents (in the form 
of loan agreements and promissory notes) with Secondary Borrowers as 
follows: (i) Not later than twelve (12) months after the Bond Issue 
Date, Secondary Loan documents representing at least fifty percent 
(50%) of the Bond Loan proceeds allocated for Secondary Loans, and (ii) 
not later than twenty-four (24) months after the Bond Issue Date, 
Secondary Loan documents representing one hundred percent (100%) of the 
Bond Loan proceeds allocated for Secondary Loans. In the event that the 
Eligible CDFI does not comply with the foregoing requirements of 
clauses (i) and (ii) of this paragraph, the available Bond Loan 
proceeds at the end of the applicable period shall be reduced by an 
amount equal to the difference between the amount required by clauses 
(i) and (ii) minus the amount previously committed to the Secondary 
Loans in the applicable period. Secondary Loans shall carry loan 
maturities suitable to the loan purpose and consistent with loan-to-
value requirements set forth in the Secondary Loan Requirements. 
Secondary Loan maturities shall not exceed the corresponding Bond or 
Bond Loan maturity date. It is the expectation of the CDFI Fund that 
such interest rates will be reasonable based on the borrower and loan 
characteristics.
    E. Secondary Loan collateral requirements.
    1. The Regulations state that Secondary Loans must be secured by a 
first lien of the Eligible CDFI on pledged collateral, in accordance 
with the Regulations (at 12 CFR 1808.307(f)) and within certain 
parameters. Examples of acceptable forms of collateral may include, but 
are not limited to: Real property (including land and structures); 
machinery, equipment and movables; cash and cash equivalents; accounts 
receivable; letters of credit; inventory; fixtures; contracted revenue 
streams from non-Federal counterparties, provided the Secondary 
Borrower pledges all assets, rights and interests necessary to generate 
such revenue stream; and a Principal Loss Collateral Provision. 
Intangible assets, such as customer relationships, intellectual 
property rights, and to-be-constructed real estate improvements, are 
not acceptable forms of collateral.
    2. The Regulations require that Bond Loans must be secured by a 
first lien on a collateral assignment of Secondary Loans, and further 
that the Secondary Loans must be secured by a first lien or parity lien 
on acceptable collateral.
    3. Valuation of the collateral pledged by the Secondary Borrower 
must be based on the Eligible CDFI's credit policy guidelines and must 
conform to the standards set forth in the Uniform Standards of 
Professional Appraisal Practice (USPAP).
    4. Independent third-party appraisals are required for the 
following collateral: Real estate; fixtures, machinery and equipment, 
and movables stock valued in excess of $250,000; contracted revenue 
stream from non-Federal creditworthy counterparties. Secondary Loan 
collateral shall be valued using the cost approach, net of depreciation 
and shall be required for the following: Accounts receivable; 
machinery, equipment and movables; and fixtures.
    F. Qualified Issuer approval of Eligible CDFIs. The Qualified 
Issuer shall not approve any Bond Loans to an Eligible CDFI where the 
Qualified Issuer has actual knowledge, based upon reasonable inquiry, 
that within the past five (5) years the Eligible CDFI: (i) Has been 
delinquent on any payment obligation (except upon a demonstration by 
the Qualified Issuer satisfactory to

[[Page 27382]]

the CDFI Fund that the delinquency does not affect the Eligible CDFI's 
creditworthiness), or has defaulted and failed to cure any other 
obligation, on a loan or loan agreement previously made under the Act; 
(ii) has been found by the Qualified Issuer to be in default of any 
repayment obligation under any Federal program; (iii) is financially 
insolvent in either the legal or equitable sense; or (iv) is not able 
to demonstrate that it has the capacity to comply fully with the 
payment schedule established by the Qualified Issuer.
    G. Credit Enhancements; Principal Loss Collateral Provision.
    1. In order to achieve the statutory zero-credit subsidy constraint 
of the CDFI Bond Guarantee Program and to avoid a call on the 
Guarantee, Eligible CDFIs are encouraged to include Credit Enhancements 
and Principal Loss Collateral Provisions structured to protect the 
financial interests of the Federal Government.
    2. Credit Enhancements may include, but are not limited to, payment 
guarantees from third parties or Affiliates, lines or letters of 
credit, or other pledges of financial resources that enhance the 
Eligible CDFI's ability to make timely interest and principal payments 
under the Bond Loan.
    3. As distinct from Credit Enhancements, Principal Loss Collateral 
Provisions may be provided in lieu of pledged collateral and in 
addition to pledged collateral. A Principal Loss Collateral Provision 
shall be in the form of cash or cash equivalent guarantees in amounts 
necessary to secure the Eligible CDFI's obligations under the Bond Loan 
after exercising other remedies for default. For example, a Principal 
Loss Collateral Provision may include a deficiency guarantee whereby 
another entity assumes liability after other default remedies have been 
exercised, and covers the deficiency incurred by the creditor. The 
Principal Loss Collateral Provision shall, at a minimum, provide for 
the provision of cash or cash equivalents in an amount that is not less 
than the difference between the value of the collateral and the amount 
of the accelerated Bond Loan outstanding.
    4. In all cases, acceptable Credit Enhancements or Principal Loss 
Collateral Provisions shall be proffered by creditworthy providers and 
shall provide information about the adequacy of the facility in 
protecting the financial interests of the Federal Government, either 
directly or indirectly through supporting the financial strength of the 
Bond Issue. This includes, but is not limited to, the amount and 
quality of any Credit Enhancements, the financial strength of the 
provider of the Credit Enhancement, the terms, specific conditions such 
as renewal options, and any limiting conditions or revocability by the 
provider of the Credit Enhancement.
    5. For Secondary Loans benefitting from a Principal Loss Collateral 
Provision (e.g., a deficiency guarantee), the entity providing the 
Principal Loss Collateral Provision must be underwritten based on the 
same criteria as if the Secondary Loan were being made directly to that 
entity with the exception that the guarantee need not be 
collateralized.
    6. If the Principal Loss Collateral Provision is provided by a 
financial institution that is regulated by an Appropriate Federal 
Banking Agency or an Appropriate State Agency, the guaranteeing 
institution must demonstrate performance of financially sound business 
practices relative to the industry norm for providers of collateral 
enhancements as evidenced by reports of Appropriate Federal Banking 
Agencies, Appropriate State Agencies, and auditors, as appropriate.
    H. Reporting requirements.
    1. General. Qualified Issuers and Eligible CDFIs that participate 
in the Bond Guarantee Program will be required to execute and deliver 
at closing legal agreements including the Agreement to Guarantee, the 
Bond Trust Indenture, and the Bond Loan Agreement, among others. The 
forms of these documents, containing terms and conditions and covenants 
over use of proceeds, loan commitments, advances, disbursements, 
principal and interest payments, program fees and accounts, Secondary 
Loans, financial condition and information reporting and other matters 
of the Qualified Issuer, Master Servicer/Trustee, and Eligible CDFIs, 
will be published and accessible on the CDFI Fund's Web site or sent to 
the Qualified Issuer by other means.
    2. Reports.
    (a) In general, as required pursuant to the Regulations at 12 CFR 
1808.619, the CDFI Fund will collect information from each Qualified 
Issuer which may include, but will not be limited to: (i) Quarterly and 
annual financial reports and data (including an OMB A-133 audit, as 
applicable) for the purpose of monitoring the financial health, ratios 
and covenants of Eligible CDFIs that include asset quality (non-
performing assets, loan loss reserves, and net charge-off ratios), 
liquidity (current ratio, working capital, and operating liquidity 
ratio), solvency (capital ratio, self-sufficiency, fixed charge, 
leverage, and debt service coverage ratios); (ii) annual reports as to 
the compliance of the Qualified Issuer and Eligible CDFIs with the 
Regulations and specific requirements of the Bond Documents; (iii) 
monthly reports on uses of Bond Loan proceeds and Secondary Loan 
proceeds; (iv) Master Service/Trustee summary of program accounts and 
transactions for each Bond Issue; (v) Secondary Loan certifications 
describing Eligible CDFI lending, collateral valuation, and 
eligibility; (vi) financial data on Secondary Loans to monitor 
underlying collateral, gauge overall risk exposure across asset 
classes, and assess loan performance, quality, and payment history; 
(vii) annual certifications of compliance with program requirements; 
(viii) material event disclosures including any reports of Eligible 
CDFI management and/or organizational changes; (ix) annual updates to 
the Capital Distribution Plan (as described below); (x) supplements 
and/or clarifications to correct reporting errors (as applicable); (xi) 
project level reports to understand overall program impact and the 
manner in which Bond proceeds are deployed for Eligible Community or 
Economic Development Purposes; and (xii) such other information that 
the CDFI Fund and/or the Bond Purchaser may require, including but not 
limited to racial and ethnic data showing the extent to which members 
of minority groups are beneficiaries of the CDFI Bond Guarantee 
Program, to extent permissible by law.
    (b) Qualified Issuers receiving a Guarantee shall submit annual 
updates to the approved Capital Distribution Plan, including an updated 
Proposed Sources and Uses of Funds for each Eligible CDFI, noting any 
deviation from the original baseline with regards to both timing and 
allocation of funding among Secondary Loan asset classes. The Qualified 
Issuer shall also submit a narrative, no more than five (5) pages in 
length for each Eligible CDFI, describing the Eligible CDFI's capacity 
to manage its Bond Loan. The narrative shall address any Notification 
of Material Events and relevant information concerning the Eligible 
CDFI's management information systems, personnel, executive leadership 
or board members, as well as financial capacity. The narrative shall 
also describe how such changes affect the Eligible CDFI's ability to 
generate impacts in Low-Income or Underserved Rural Areas. Any Eligible 
CDFI seeking to expand the allowable Secondary Loan asset classes 
beyond what was approved by the Bond Guarantee Program's Credit Review 
Board or make other deviations that could potentially result in a

[[Page 27383]]

modification, as that term is defined in OMB Circulars A-11 and A-129, 
must receive approval from the CDFI Fund before the Eligible CDFI can 
begin to enact the proposed changes. The CDFI Fund will consider 
whether the Eligible CDFI possesses or has acquired the appropriate 
systems, personnel, leadership, and financial capacity to implement the 
revised Capital Distribution Plan. The CDFI Fund will also consider 
whether these changes assist the Eligible CDFI in generating impacts in 
Low-Income or Underserved Rural Areas. Such changes will be reviewed by 
the CDFI Bond Guarantee Program and presented to the Credit Review 
Board for approval, and appropriate consultation will be made with OMB 
to ensure compliance with OMB Circulars A-11 and A-129, prior to 
notifying the Eligible CDFI if such changes are acceptable under the 
terms of the Bond Loan Agreement. An Eligible CDFI may request such an 
update to their Capital Distribution Plan prior to Bond Issue Closing, 
and thereafter may only request such an update once per the CDFI's 
fiscal year.
    (c) Detailed information on specific reporting requirements and the 
format, frequency, and methods by which this information will be 
transmitted to the CDFI Fund will be provided to Qualified Issuers, 
Program Administrators, Servicers, and Eligible CDFIs through the Bond 
Loan Agreement and a combination of webinar trainings and/or scheduled 
outreach sessions. Reporting requirements will be enforced through the 
Agreement to Guarantee and the Bond Loan Agreement, and will be 
assigned a valid OMB control number pursuant to the Paperwork Reduction 
Act.
    (d) Each Qualified Issuer will be responsible for the timely and 
complete submission of the annual reporting documents, including such 
information that must be provided by other entities such as Eligible 
CDFIs or Secondary Borrowers. If such other entities are required to 
provide annual report information or documentation, or other 
documentation that the CDFI Fund may require, the Qualified Issuer will 
be responsible for ensuring that the information is submitted timely 
and complete. Notwithstanding the foregoing, the CDFI Fund reserves the 
right to contact such entities and require that additional information 
and documentation be provided directly to the CDFI Fund.
    (e) The CDFI Fund will use the aforementioned information to 
monitor compliance with the requirements set forth in the Agreement to 
Guarantee and to assess the impact of the CDFI Bond Guarantee Program.
    (f) The CDFI Fund reserves the right, in its sole discretion, to 
modify its reporting requirements if it determines it to be appropriate 
and necessary; however, such reporting requirements will be modified 
only after notice to Qualified Issuers. Additional information about 
reporting requirements pursuant to this NOGA and the Bond Documents 
will be subject to the Paperwork Reduction Act.
    3. Accounting.
    (a) In general, the CDFI Fund will require each Qualified Issuer 
and Eligible CDFI to account for and track the use of Bond Proceeds and 
Bond Loan proceeds. This means that for every dollar of Bond Proceeds 
and received from the Bond Purchaser, the Qualified Issuer is required 
to inform the CDFI Fund of its uses, including Bond Loan proceeds. This 
will require Qualified Issuers and Eligible CDFIs to establish separate 
administrative and accounting controls, subject to the applicable OMB 
Circulars.
    (b) The CDFI Fund will provide guidance to Qualified Issuers 
outlining the format and content of the information that is to be 
provided on an annual basis, outlining and describing how the Bond 
Proceeds and Bond Loan proceeds were used.

VI. Agency Contacts

    A. The CDFI Fund will respond to questions and provide support 
concerning this NOGA, the Qualified Issuer Application and the 
Guarantee Application between the hours of 9:00 a.m. and 5:00 p.m. ET, 
starting with the date of the publication of this NOGA. The final date 
to submit questions is June 18, 2014. Applications and other 
information regarding the CDFI Fund and its programs may be obtained 
from the CDFI Fund's Web site at http://www.cdfifund.gov. The CDFI Fund 
will post on its Web site responses to questions of general 
applicability regarding the CDFI Bond Guarantee Program.
    B. The CDFI Fund's contact information is as follows:

                                          Table 2--Contact Information
----------------------------------------------------------------------------------------------------------------
                                          Telephone number (not
           Type of question                     toll free)                        Email addresses
----------------------------------------------------------------------------------------------------------------
CDFI Bond Guarantee Program...........  (202) 653-0421 Option 5..  [email protected].
CDFI Certification....................  (202) 653-0423...........  [email protected].
Compliance Monitoring and Evaluation..  (202) 653-0423...........  [email protected].
Information Technology Support........  (202) 653-0422...........  [email protected].
----------------------------------------------------------------------------------------------------------------

    C. Communication with the CDFI Fund. The CDFI Fund will use the 
myCDFIFund Internet interface to communicate with applicants, Qualified 
Issuers, Program Administrators, Servicers, Certified CDFIs and 
Eligible CDFIs, using the contact information maintained in their 
respective myCDFIFund accounts. Therefore, each such entity must 
maintain accurate contact information (including contact person and 
authorized representative, email addresses, fax numbers, phone numbers, 
and office addresses) in its respective myCDFIFund account. For more 
information about myCDFIFund (which includes information about the CDFI 
Fund's Community Investment Impact System), please see the Help 
documents posted at http://www.cdfifund.gov/ciis/accessingciis.pdf.

VII. Information Sessions and Outreach

    The CDFI Fund may conduct webcasts, webinars, or information 
sessions for organizations that are considering applying to, or are 
interested in learning about, the CDFI Bond Guarantee Program. For 
further information, please visit the CDFI Fund's Web site at http://www.cdfifund.gov.

    Authority: Pub. L. 111-240; 12 U.S.C. 4701, et seq.; 12 CFR part 
1808.

    Dated: May 8, 2014.
Dennis Nolan,
Deputy Director, Community Development Financial Institutions Fund.
[FR Doc. 2014-10950 Filed 5-12-14; 8:45 am]
BILLING CODE 4810-70-P