[Federal Register Volume 64, Number 19 (Friday, January 29, 1999)]
[Notices]
[Pages 4754-4757]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-2024]
[[Page 4753]]
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Part II
Department of the Treasury
_______________________________________________________________________
Community Development Financial Institutions Fund
_______________________________________________________________________
Notice of Funds Availability (NOFA) Inviting Applications for the
Community Development Financial Institutions Program--Technical
Assistance Component; Notice
Federal Register / Vol. 64, No. 19 / Friday, January 29, 1999 /
Notices
[[Page 4754]]
DEPARTMENT OF THE TREASURY
Community Development Financial Institutions Fund
[No. 982-0154]
Notice of Funds Availability (NOFA) Inviting Applications for the
Community Development Financial Institutions Program--Technical
Assistance Component
AGENCY: Community Development Financial Institutions Fund, Department
of the Treasury.
ACTION: Notice of Funds Availability (NOFA) inviting applications.
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SUMMARY: The Community Development Banking and Financial Institutions
Act of 1994 (12 U.S.C. 4701 et seq.) (the ``Act'') authorizes the
Community Development Financial Institutions Fund (the ``Fund'') to
select and provide assistance to eligible applicants under the
Community Development Financial Institutions (``CDFI'') Program. Such
assistance may include financial assistance and technical assistance.
Technical assistance (``TA'') may be used for activities that enhance
the capacity of both CDFIs and entities proposing to become CDFIs, such
as the training of management and other personnel, the use of
consulting services for the development of programs, loan or investment
products, improving financial management and internal operations,
enhancing a CDFI's community impact, the acquisition of technology to
increase operating efficiencies and other activities deemed appropriate
by the Fund.
Since the advent of the CDFI Program, the Fund has issued NOFAs
inviting applications for both TA and financial assistance. This NOFA
is for a TA only component (``TA Component'') of the CDFI Program to
enable the Fund to address more effectively the unmet capacity needs of
CDFIs and entities proposing to become CDFIs. This NOFA is intended to
award grants to eligible applicants with capacity needs and potential
for increasing their community development impact if such capacity
needs are addressed. This NOFA provides guidance on the contents of the
necessary application materials and program requirements. Subject to
funding availability, the Fund intends to award up to $5 million in
appropriated funds under this NOFA. The Fund reserves the right to
award in excess of $5 million in appropriated funds under this NOFA
provided that the funds are available and the Fund deems it
appropriate. It is anticipated that 80 to 100 awards will be made under
this NOFA. The anticipated maximum award amount per applicant is
$50,000. However, the Fund in its sole discretion, reserves the right
to award amounts in excess of $50,000 if an applicant demonstrates, to
the satisfaction of the Fund, the need for such additional amounts and
the added potential community development impact resulting from such
additional amounts.
DATES: The original and three copies of the application may be
submitted at any time following January 29, 1999. The deadline for
receipt of the original and three copies of the application for TA
Component funds is 6 p.m. EST on April 27, 1999. Applications received
in the Fund's office after that date and time will be rejected and
returned to the sender.
ADDRESSES: Applications must be sent to: Awards Manager, Community
Development Financial Institutions Fund, U.S. Department of the
Treasury, 601 13th St., NW., Suite 200 South, Washington, DC 20005.
Applications sent electronically or by facsimile will not be accepted.
FOR FURTHER INFORMATION CONTACT: If you have any questions about the
programmatic requirements of the TA Component contact the Technical
Assistance Program Manager. If you wish to request an application
package or have questions regarding application procedures, contact the
Awards Manager. They can be reached by phone at (202) 622-8662, by
facsimile at (202) 622-7754 or by mail at CDFI Fund, U.S. Department of
the Treasury, 601 13th St., NW., Suite 200 South, Washington, DC 20005.
(The phone and facsimile numbers are not toll free.) Allow at least one
to two weeks for the receipt of the application package. Applications
and other information regarding the Fund and its programs may be
downloaded from the Fund's website at http://www.treas.gov/cdfi.
SUPPLEMENTARY INFORMATION:
I. Background
Credit and investment capital are essential ingredients for
creating and retaining jobs, developing affordable housing, starting or
expanding businesses, revitalizing neighborhoods, and empowering
people. As a key urban and rural policy initiative, the CDFI Program is
fostering the creation of a national network of financial institutions
that are specifically dedicated to community development. CDFIs make
loans, investments and provide development services to economically
distressed investment areas and disadvantaged targeted populations. In
order to facilitate the development of a national network of CDFIs, the
Fund is seeking to support the efforts of such entities to build their
organizational capacity to make loans and investments and provide
development services. In order to use the TA funds strategically, it is
the Fund's intention to target such funds to CDFIs and entities
proposing to become CDFIs that have demonstrated capacity needs and
possess significant potential for increasing their community
development impact with the assistance of a limited amount of TA. The
anticipated maximum award per applicant under this NOFA is $50,000.
However, the Fund, in its sole discretion, reserves the right to award
amounts in excess of $50,000 if an applicant demonstrates, to the
satisfaction of the Fund, the need for such additional amounts and the
added potential community development impact resulting from such
additional amounts.
On October 26, 1998, the Fund published in the Federal Register a
NOFA for financial assistance under the CDFI Program Intermediary
Component and a NOFA for financial assistance and TA under the CDFI
Program Core Component. Under the Intermediary Component NOFA, the Fund
is making available up to $7.5 million in appropriated funds to CDFIs
that provide financing primarily to other CDFIs or to support the
formation of CDFIs. Under the Core Component NOFA, the Fund is making
available up to $50 million in appropriated funds to CDFIs that serve
their target markets directly. Applicants under that Core Component
NOFA may apply for both financial assistance and TA. All applications
for financial assistance, TA or both under the Core Component will be
evaluated separately and apart from the applications under this TA
Component. Moreover, the application requirements and the selection
criteria under the Core Component NOFA differ from those contained in
this TA Component NOFA, because the TA Component NOFA is singularly
focused on providing TA to enhance the capacity of CDFIs and entities
proposing to become CDFIs. Interested applicants are encouraged to
apply for TA under one NOFA or the other; however, applicants are not
prohibited from applying for TA under both NOFAs.
II. Eligibility
The Act and the interim rule governing the CDFI Program (12 CFR
part 1805), which was published in the Federal Register on April 4,
1997 (62 FR 16444), specify the requirements that
[[Page 4755]]
each applicant must meet to be eligible to apply for TA. At the time an
entity submits its application, the entity must meet or propose to meet
the CDFI certification requirements under Sec. 1805.200. In general, a
CDFI must have a primary mission of promoting community development,
provide loans or development investments, serve an investment area or a
targeted population, provide development services, maintain community
accountability, and be a nongovernment entity. At the time an entity
submits its application, the entity must be duly organized and validly
existing under the laws of the jurisdiction in which it is incorporated
or otherwise established. The details regarding these requirements and
other program requirements are described in the interim rule and the
application packet.
III. Form of Assistance
An applicant under this NOFA may only submit an application for a
TA grant.
IV. Application Packet
Section 1805.701 of the interim rule provides that unless otherwise
specified in an applicable NOFA, each application must contain the
information specified in the application packet, including the items
described in Secs. 1805.701(a)-(j). For purposes of this NOFA, the Fund
is specially tailoring the collection of information requirements.
Specifically, applicants need only submit the information required by
the TA Component application packet. The TA Component application
packet requires the submission of the following information:
(a) Applicant Information. The applicant's name, address and name
and telephone number of the applicant's authorized representative and
contact person.
(b) Award Request. The dollar amount of the TA grant requested by
the applicant.
(c) Eligibility Verification. If the Fund has not certified an
applicant as a CDFI and an applicant does not have an application for
certification pending with the Fund, the applicant must provide
information necessary to establish that it is, or will be, a CDFI. An
applicant must demonstrate whether it meets the CDFI eligibility
requirements by providing the information described in
Secs. 1805.701(b)(1)-(8). If an applicant is currently certified by the
Fund as a CDFI, it may submit a copy of the Fund's letter of
certification and the Certification of Material Changes form contained
within the application in lieu of the information described in
Secs. 1805.701(b)(1)-(8). However, an applicant may include in its
application for a TA grant information that it believes is otherwise
relevant to the Fund's evaluation of the application under the criteria
set forth in this NOFA. An entity that proposes to become a CDFI is
eligible to apply for a TA grant if the Fund determines that such
entity's application materials provide a realistic course of action to
ensure that it will meet the requirements described in
Secs. 1805.200(b)-(h) within two years of entering into an Assistance
Agreement with the Fund.
(d) Comprehensive Business Plan. An applicant must submit a five-
year Comprehensive Business Plan that addresses the items described in
this paragraph (d) (the TA Component Comprehensive Business Plan is an
abbreviated version of what is required under the Core Component NOFA).
The Comprehensive Business Plan should, to the maximum extent
practical, be limited to ten pages or less (applicants may provide
attachments, including supplemental documents, as appropriate, on items
referenced in the Comprehensive Business Plan).
(1) Management capacity. An applicant must provide a narrative
description of its current management capacity, including detailed
information on the background and capacity of the applicant's
management team, key personnel and governing board members as
appropriate.
(2) Track Record and Historical Financial Performance. An applicant
must provide information on its historical and current financial
condition, including a copy of audited financial statements, financial
statements that have been reviewed by a certified public accountant, or
financial statements that have been reviewed by the applicant's
Appropriate Federal Banking Agency (its Federal regulator) for the last
three completed fiscal years, and the most recent internal financial
statements since the beginning of the applicant's current fiscal year.
The applicant must also provide information on its loans and
Development Investments for the three most recent fiscal years,
including information on the total number and dollar amount of such
loans and Development Investments during each fiscal year during this
time frame. If an applicant has been in operation for less than three
years, the applicant must describe such activities for each fiscal year
since inception. The applicant must provide information necessary to
assess trends in its financial and operating performance (such as,
portfolio delinquencies, defaults and charge-offs).
(3) Market Analysis and Strategy. An applicant must provide an
analysis of its target markets, including a description of the needs of
the Investment Area(s) and Targeted Population(s), as applicable. An
applicant must also describe its five-year strategy for meeting the
demand for loans or Development Investments generated by the needs of
its target market(s) through its products and services. The strategy
description may include plans for growth of lending volume and lending
products, expansion of Development Services, staffing and management
appropriate to meet such growth and growth of the operating budget.
Projected changes in overall capital structure (asset and liability
composition) may also be described. The narrative discussion may be
supplemented with quantitative projections.
(4) Coordination Strategy. An applicant must describe:
(i) Its plan to coordinate use of assistance from the Fund with
existing Federal, State, local, and tribal government assistance
programs and private sector resources;
(ii) How its proposed activities are consistent with existing
economic, community, and housing development plans adopted for an
Investment Area(s) or Targeted Population(s); and
(iii) How it will coordinate with community organizations,
financial institutions, and Community Partners (if applicable) that
will provide loans, equity investments, secondary markets, or other
services to an Investment Area(s) or a Targeted Population(s).
(5) Funding Sources. An applicant must provide information:
(i) On its current and projected sources of capital and other
financial support. Such projections must relate to and be consistent
with the strategy description provided under paragraph (3); and
(ii) To demonstrate that it has a plan for achieving or maintaining
financial viability within the five-year period. Such information must
demonstrate that the applicant will not be dependent on future awards
of assistance from the Fund for its continued viability.
(6) Community Partnership. In the case of an applicant submitting
an application with a Community Partner, the applicant must include in
its application the information described in Sec. 1805.701(d)(12).
(e) Technical Assistance Proposal. An applicant must provide a
Technical
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Assistance Proposal (``TAP'') that includes information on the TA
needed to enhance the capacity of the organization to carry out its
Comprehensive Business Plan. Such information must include the items
described in this paragraph (e). The TAP should, to the maximum extent
practicable, be limited to ten pages or less (applicants may provide
attachments, including supplemental documents, as appropriate, on items
referenced in the TAP). An applicant must provide:
(1) An evaluation of its capacity needs (this may be a self-
evaluation);
(2) A detailed description of the type(s) of TA needed to meet the
identified capacity needs. Eligible types of TA may include, but need
not be limited to, the following: (i) consulting services; (ii)
technology items; and (iii) training for staff or management. The Fund
will not consider requests under this NOFA for expenses that, in the
interpretation of the Fund, are deemed to be ongoing operating expenses
rather than non-recurring expenses (for example, the cost of design of
marketing materials for a loan product through a consulting contract is
a non-recurring expense but the cost of production or distribution of
printed marketing materials is an ongoing expense; salary expenses for
staff are ongoing but the cost of a consulting contract for a discrete
scope of services is a non-recurring expense);
(3) A detailed description of the strategy for obtaining such TA,
including proposed providers of TA and their qualifications or the
specific technology items to be acquired. If an applicant cannot
identify specific providers of TA in its application, it must identify
the requisite qualifications that it will seek for such TA providers;
(4) An estimate of the cost to obtain the TA for each year that
will include use of TA funds. This cost estimate must include expense
projections for each of the specific activities to be funded with TA
funds; and
(5) A projection of the benefits expected to be created within its
Investment Area(s) or for its Targeted Population(s) with the enhanced
capacity resulting from the TA.
(f) Conflict of Interest. An applicant must submit a copy of its
conflict of interest policies, consistent with the requirements of
Sec. 1805.906.
(g) Lobbying Disclosure Act of 1995. An applicant must identify
whether the Internal Revenue Service (IRS) has recognized it as exempt
from Federal income tax under section 501(c)(4) of the Internal Revenue
Code.
(h) Miscellaneous. An applicant must indicate and describe the
circumstances underlying any back taxes due to the IRS, any delinquent
debts owed to Federal, State or local governments, and whether it has
ever filed for bankruptcy.
(i) Environmental Information. An applicant must review and
complete the Environmental Review Form contained in the application.
(j) Applicant Certification. An applicant and Community Partner (if
applicable) must review and complete the assurances and certifications
form contained in Appendix A of the application.
(k) Previous Awardees. In the case of an applicant that has
previously received assistance under the CDFI Program, the applicant
must demonstrate that it:
(1) Has substantially met its performance goals and other
requirements described in its previous Assistance Agreement(s); and
(2) Will expand its operations into a new Investment Area(s), serve
a new Targeted Population(s), offer more products or services, or
increase the volume of its activities.
(l) Previous History. In the case of an applicant with a prior
history of serving Investment Area(s) or Targeted Population(s), the
applicant must demonstrate that it:
(1) Has a record of success in serving Investment Area(s) or
Targeted Population(s); and
(2) Will expand its operations into a new Investment Area(s), serve
a new Targeted Population(s), offer more products or services, or
increase the volume of its activities.
V. Evaluation and Selection
In evaluating and selecting applicants, the Fund will use the
evaluation criteria found in Sec. 1805.802(b), except that the Fund
will not consider the evaluation criteria relating to matching funds in
Secs. 1805.802(b)(2)(i), (ii) and (iv). Under the Act, the Fund has
express authority to consider evaluation criteria in addition to those
set forth in 12 U.S.C. 4706 and 1805.802(b). The Fund also has broad
discretion in evaluating the relative importance of each such
criterion. For purposes of this TA Component NOFA, the Fund has added
as an additional evaluation criterion the extent of the applicant's
demonstrated capacity needs.
In conducting its substantive review of applications, the Fund will
initially evaluate applications using a 100 point maximum point scale.
In selecting applicants for TA grant awards, the Fund will accord
predominant weight to the following two evaluation criteria:
(a) The extent of the applicant's demonstrated capacity needs, 30
points; and
(b) The extent and nature of the potential community development
impact that will be achieved by the applicant with the assistance of
the Fund's TA, relative to the amount of TA to be provided by the Fund,
30 points.
The Fund will continue to evaluate applications using the remaining
applicable criteria set forth in Sec. 1805.802(b) described below;
however, such evaluation criteria will receive less weight than the two
criteria set forth above:
(a) The capacity, skills and experience of the applicant's
management team and other key personnel (overall organizational
structure, lending/investing activities, community development
involvement), 14 points for established applicants and 24 points for
start-ups;
(b) The applicant's track record, financial strength and current
operations (including its general financial operations and lending/
investment operations), 10 points for established applicants and no
points for start-ups;
(c) The market analysis, strategy and (if applicable) Community
Partnerships, 12 points;
(d) Coordination strategy, 2 points; and
(e) Funding sources, 2 points.
As shown above, the Fund will utilize two different 100 point
scales for the application evaluation, depending on whether an
applicant is deemed by the Fund to be a start-up organization or an
established organization. The Fund defines a start-up organization as
an entity that has been in operation for less than two years. The Fund
will find an organization to be a start-up if it began incurring
operating expenses after January 29, 1997, based on a review of
submitted income and expense statements and/or other information by an
applicant as part of its application. In evaluating applications of
start-up organizations, the Fund will place greater emphasis on the
experience, strength and background of an applicant's management team
and key personnel than on the breadth and depth of its financial
resources and its trends in operating performance.
Once the initial evaluation is completed, the Fund will determine
which applications will receive further consideration for funding based
on the application scores (standardized if deemed appropriate), the
recommendations of the individuals performing the initial reviews and
the amount of funds available. Applicants
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selected for further review or a second stage evaluation may be
contacted for purposes of obtaining clarifying or confirming
information. A final review panel will consider the results of the
initial and second stage evaluations and the geographic and
institutional diversity of those applicants being considered for
funding in accordance with 12 CFR 1805.801 and 1805.802(b)(5). The
final review panel will make recommendations to the Fund's selecting
official.
In assessing the extent of demonstrated capacity need, the Fund
will consider the extent of funding previously awarded by the Fund to
the applicant. While previous awardees are eligible to apply under this
NOFA, given the focus on applicants with demonstrated unmet capacity
building needs, it is the expectation of the Fund that a substantial
majority of the funds awarded under this NOFA will be to applicants
that are not previous awardees. On the other hand, success in a
previous funding round will not prevent an applicant from receiving a
TA grant under this NOFA provided that it is consistent with the Act
and the interim rule governing the CDFI Program (12 CFR part 1805).
The Fund has exclusive discretion in the selection of applications
for assistance. The anticipated maximum award per applicant under this
NOFA is $50,000. However, the Fund, in its sole discretion, reserves
the right to award amounts in excess of $50,000 if it deems it
appropriate.
VI. Workshops
The Fund expects to host workshops during the period from March 1
to March 19, 1999, to disseminate information to organizations
interested in applying for assistance under this NOFA. If you wish to
be on the mailing list to receive information about such workshops,
please fax your request to the Fund. Information about these workshops
will also be available on the Fund's website at http://www.treas.gov/
cdfi.
Authority: 12 U.S.C. 4703, 4703 note, 4704, 4706, 4707, 4717,
4718; 12 CFR part 1805.
Dated: January 22, 1999.
Maurice A. Jones,
Deputy Director for Policy and Programs, Community Development
Financial Institutions Fund.
[FR Doc. 99-2024 Filed 1-28-99; 8:45 am]
BILLING CODE 4810-70-P
