Monday, April 10, 2017
What Trump's $210 Million Budget Cut Will Do to Small Business
Why is Trump eliminating CDFI grants?
According to budget sources, the original purpose of the CDFI grant program is no longer needed. The CDFI grant fund was created by legislation in 1994 to offer matching grants to make loans to small businesses. It's purpose is to promote economic revitalization in distressed communities throughout the United States by providing financial resources to community development financial institutions (CDFI).
CDFIs are sources of capital that small businesses, especially those in low-income and underserved communities, have come to depend on. Trump wants to eliminate this source of funding because he feels we now have a "mature industry where private institutions have ready access to the capital needed to extend credit and provide financial services to underserved communities.
What will happen to small business?
While Trump feels CDFI grants are no longer needed, not everyone agrees. Many, like Ceyl Prinster, president and CEO of Colorado Enterprise Fund, feel that private institutions will not be able to fill the gap left by the elimination of CDFIs. In Colorado alone, the Colorado Enterprise Fund, a CDFI non-profit loan fund, approved $9.3 million to 217 small business borrowers in 2016.
Many fear cutting the CDFI grant program will hurt small businesses across America. What do you think?
Read more at www.bizjournals.com/denver/news/2017/03/29/trumps-budget-would-hit-small-business-says.html