In the spring of 2020, the year in which banks across the country committed to closing the racial wealth gap and businesses near and far launched DEI programs, the Hope Policy Institute published data on the asset gap plaguing community development financial institutions, or CDFIs.
“Even though CDFIs are by their mission intended to decrease inequities in low-income communities, disparities persist in the amount of funding and resources allocated to support their work,” the organization wrote in Closing the CDFI Asset Gap. “Minority-led CDFIs are underrepresented in the field as a whole, and they are underfunded compared to their white counterparts.”
Looking at 2017 data gathered by the U.S. Treasury’s CDFI Fund, the report highlighted that minority-led CDFIs held just 12% of all CDFI assets while white-led CDFIs housed 75%. But this is not just a funding problem. The disparity determines who holds decision-making power in communities — sometimes those with that power come from outside of communities. It also shapes how communities build and own assets in their neighborhoods, and whether projects shift resources and governance toward community self‑determination.
For Amber Banks, president and CEO of the African American Alliance of CDFI CEOs, that six-to-one difference made the problem facing Black CDFIs clear. “Black CDFIs tend to face a lot of the same challenges that the communities that they serve face in terms of access to capital,” she says. This impacts the CDFIs’ ability to build and leverage networks, raise money, grow their funds, and ultimately serve the communities they set out to support.
“The Alliance was created to solve these issues in the form of an intermediary,” Banks explains. The network helps Black-led CDFIs build their power and serve their communities on their own terms. One of the ways it does that is by creating a sense of community among members where they are able to discuss challenges and solutions, and sometimes collaborate on projects.
(Photo Courtesy of the Alliance)
Stemming from a 2018 conversation among 23 Black CDFI CEOs, the Alliance officially incorporated as a nonprofit in May 2020. Since then, the Alliance has brought well over 100 members into its fold and secured more than $50 million in funding to fuel the efforts of its members like The Housing Fund in Nashville, Tennessee, and the Neighborhood Housing Services of Chicago.
With a focus on creating and maintaining affordable homes for moderate- and low-income folks and families, The Housing Fund’s work has evolved from serving as a revolving loan fund when it launched in 1996 to now offering a suite of programs that fall under three big umbrellas: home buying, home improvement, and development.
“Thirty years later, in the City of Nashville, there’s still an affordable housing crisis. We are still working on it one unit at a time, still doing development loans, still doing down payment assistance loans. And we’ve expanded to the entire state of Tennessee,” explains Angela Belcher, the Fund’s executive vice president and chief operating officer. “We find ways to fill gaps in the marketplace.”
This gap-filling includes a shared equity homeownership program with zero-interest loans that, upon the sale of a home in the program, leads to the reinvestment of a portion of the sale profit back into the fund and, thus, onto the next owner to preserve affordability. The Fund also manages a community land trust on behalf of Metro Nashville and runs a housing resiliency fund. The resiliency fund offers grant-based property tax relief to homeowners facing unaffordable bills after a 34% property tax hike went into effect that fateful month of March 2020. Thanks to a 2020 investment from Amazon, for five years the grants paid the difference between old and new tax bills for homeowners who would have otherwise struggled to pay the full amount.
The Housing Fund’s anti-displacement work has both been inspired by, and has also inspired, other Alliance members. This is the crux of what the Alliance does. “It’s the opportunity to talk with other CEOs around the country who are trying to tackle some of the very same challenges we are and trying to find innovative solutions. It’s really about partnerships in the way that we’re sharing information,” Bechler explains.
The Fund’s CEO, Marshall Crawford, was one of the Alliance’s founding members and continues to be deeply involved with the organization. While serving as an Alliance board member, Crawford oversaw the creation of the Alliance’s Housing Initiative Roadmap that’s designed to help BIPOC organizations pursue and achieve housing justice in their communities.
The Alliance, The Fund, and the Neighborhood Housing Services of Chicago (NHS) are all part of an ecosystem of organizations that are working to prevent displacement in their communities. Through that process, they’re ensuring people, families, and communities feel like they belong.
Both The Fund and NHS participated in the Alliance’s inaugural cohort of its Housing Justice Champions Accelerator, which offers training and one-on-one coaching to help participants deepen their policy advocacy capacity and ability to lead housing justice work on local level.
(Photo Courtesy of the Alliance)
At the start of the program, each participating organization was asked to identify policy barriers they face. Those barriers would then serve as the focus of their work in the accelerator over the next two months.
NHS focused on property tax delinquency. Anthony Simpkins, president and CEO of Neighborhood Housing Services of Chicago, says that participating in the program helped the organization “refine our messaging and segment it among elected officials, potential government and philanthropic partners, and collaborative partners like other community-based organizations. It helped us understand how to communicate with each of those segments that we had to either convince or collaborate with.”
An organization that has prevented some 10,000 foreclosures through HUD-certified housing counseling, convenes a 30-member housing policy task force, and whose property tax payment plan — the messaging of which was worked on in the accelerator — helps tax-delinquent homeowners make monthly payments in collaboration with county officials and housing advocates, NHS is a proud member of the Alliance.
“We’re just very impressed with the work that the Alliance does, how it supports its member organizations, and how it really advocates for building the capacity of the organizations and the leaders that are a part of their network,” Simpkins says. “We’re just really proud to be a member.”
Cinnamon Janzer is a freelance journalist based in Minneapolis. Her work has appeared in National Geographic, U.S. News & World Report, Rewire.news, and more. She holds an MA in Social Design, with a specialization in intervention design, from the Maryland Institute College of Art and a BA in Cultural Anthropology and Fine Art from the University of Minnesota, Twin Cities.
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