FHLBank Chicago commits $11 million to housing and small business
FHLBank Chicago commits  million to housing and small business

The Federal Home Loan Bank of Chicago has committed $11.25 million for affordable housing and small business development to support diversity and economic opportunity in Illinois and Wisconsin over the next three years.

Its 2022 Targeted Community Lending Plan includes two affordable housing programs: the Community First Diverse Developer Initiative and the Community First Housing Counseling Resource Program. The third stream, Community First Accelerate Grants for Small Business, represents a shift in focus from the existing Community First Capacity Building Grants program.

“The need for the three new voluntary programs has been highlighted by our Community Investment Advisory Board and embraced by our Board of Directors and leadership team as an impactful strategy to contribute meaningfully to community investment solutions that support equity and expand access to affordable housing and economic development opportunities in member communities,” said Katie Naftzger, vice president and head of community investments at FHLBank Chicago, in an emailed statement.

These voluntary programs go beyond the legal commitment under federal law, which applies to the 11 federal mortgage banks, to devote 10% of its net income from the previous year to affordable housing. Some people argue redefine the mission FHLBanks to include liquidity provision in other areas.

FHLBank San Francisco launched a voluntary program $1 Million Matching Grants Program for counseling agencies called Empowering Black Homeownership.

FHLBank Chicago’s programs differ from this because all funding comes from the bank, with no counterparty, Naftzger said.

The creation of the Diverse Developer Initiative grew out of discussions with the Advisory Board’s Racial Equity Task Force which identified a critical need for resources to advance diversity and equity within the development industry. affordable housing.

There are three grant streams: internships, training, and mission-focused investments. Groups eligible to receive one include development companies seeking to expand their expertise; talent development programs that seek to increase diversity within the affordable housing industry; trade and professional associations that support various developers; and established development companies looking to provide internship opportunities. The competitive application period opened on April 4 and will close on May 13.

Two state agencies will administer the housing counseling program grants: the Illinois Housing Development Authority and the Wisconsin Housing and Economic Development Authority.

Eligible Department of Housing and Urban Development advisory organizations can use these funds for capacity-building activities to extend reach to minority, low- and middle-income homebuyers. In particular, this may include marketing and awareness raising activities; recruitment; and technology upgrades.

FHLBank Chicago significantly increased funding for its voluntary programs in 2020 beginning with its COVID-19 relief efforts, which included $21.4 million in grants for community groups and small businesses, and $1.9 billion in dollars in advances for its members. The Targeted Impact Fund has specifically focused the bank’s resources on underserved communities hardest hit by COVID-19.

“Since then, the bank has continued to dedicate increased resources to meet community needs, which have only been exacerbated by the pandemic,” Naftzger said. “The three new programs are great examples of our increased commitment.”

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