The Trump administration is proposing to cut more than $200 million from a fund for financial services for people and communities typically underserved by the banking industry.
Ohio is home to about 20 credit unions that are certified as Community Development Financial Institutions. They use federal grants and assistance to provide low-interest personal and commercial loans to people living in financially underserved communities.
The Trump administration's 2027 budget proposes cutting this funding from $324 million down to $119.5 million. The administration alleges this money has supported partisan agendas and "provided funds for products and services that advanced immigration, gender, and climate radicalism." It also wants to re-direct these funds to benefit rural communities.
Congress continues to debate the 2027 federal budget, which needs to pass by Oct. 1 when the new federal fiscal year begins.
Recently during a zoom press conference, several leaders from Ohio's CDFI Network shared examples of how federal cuts to these funds will hurt their communities.
Joe Eckly, vice president of marketing for DayAir Credit Union, which serves the Miami Valley, said losing these federal dollars would hurt his members seeking stable housing.
"We use it in housing projects, members primarily in the underserved communities to help fund down payments, finding that stable housing that then provides the ground for them to go and live a fuller life," Eckly said. "We do the same thing with auto lending as well."
According to the Ohio CDFI Network, statewide since 2005, these institutions have financed more than 52,047 homes for members.
Eckly also said losing these federal dollars would strain the credit union’s financial partnership with Artemis, a Dayton nonprofit serving those fleeing domestic violence.
"We're able to provide credit through CDFI funds to people going through the Artemis program," Eckly said. "They don’t have a financial background, and they would not be extended credit opportunities where they could then build a financial credit to start a life, get housing, get access to these things that they wouldn't otherwise have."
These credit unions also provide affordable loans to small businesses, nonprofits and commercial real estate to revitalize neighborhoods.
In Northwest Ohio, Angelal Finn is with Commodore Perry Federal Credit Union in Oak Harbor. She said losing more than $200 million in federal funds will jeopardize her credit union’s ability to help some members with their education.
"We offer a non-traditional student loan program to help adults go in and get certified in the trade schools so that they can improve their financial stability for their families," said Finn. "We offer payday lending alternatives for people that are in a tight spot, but saving them from those ridiculous interest rates that you often find at a payday lender."
