CDFIs Show Strength Amid Political Uncertainty
Originally published on Dec 3, 2025 by Impact Entrepreneur here. By Elizabeth Gilbert Kaetzel
At OFN 2025, leaders presented a confident and collaborative vision for community finance.
In 2024, Opportunity Finance Network (OFN) celebrated the 40th anniversary of both the federal Community Development Financial Institution (CDFI) Fund and OFN itself. The tone of this year’s 2025 annual conference, however, was markedly different. Just days before the gathering, the Office of Management and Budget announced a reduction-in-force for all staff at the Treasury Department’s CDFI Fund during the government shutdown. The decision — part of an administration-wide move to lay off hundreds of workers — stunned Republicans and Democrats alike, given the Fund’s broad bipartisan support. Yet despite this discouraging news, 2,100 CDFI leaders, bankers, investors, funders, and partners convened in Washington, D.C. to focus on bringing capital to the people and places that need it most. A key conference theme, “confidence amidst uncertainty,” proved fitting, underscoring the field’s ability to sustain and innovate as “financial first responders” for American communities.
“I believe that confidence and uncertainty are not countervailing points — they must exist simultaneously because the only way to predict the future we want is to create it,” said OFN CEO Harold Pettigrew. “History will not only remember that we endured — it will remember what we built. Together, we will write the next chapter of this nation’s story — a story of opportunity renewed, and possibility restored.”
Bipartisan strengths
October’s layoffs were not the Trump administration’s first attempt this year to eliminate the CDFI Fund. Earlier in 2025, President Trump urged legislators to cut the Fund from the “Big Beautiful Bill,” meeting firm bipartisan resistance. More recently, the administration withheld $324 million in appropriated funding from CDFIs, attempting to characterize them as “woke programs.”
Despite such rhetoric, CDFIs have long enjoyed strong bipartisan support. Immediately after the layoffs were announced, prominent Democratic and Republican lawmakers criticized the decision. As predominantly nonprofit lenders providing affordable capital to communities underserved by traditional banks, CDFIs supply the first rung of financing for thousands of homeowners, small businesses, and community projects. Their value to both rural and urban communities — and their ability to serve a broad and politically diverse constituency — has earned decades of backing across the aisle. The Senate CDFI Caucus, responsible for expanding and protecting CDFI impact, reflects this bipartisanship: it is co-chaired by Democratic Senator Mark Warner of Virginia and Republican Senator Mike Crapo of Idaho.
This dynamic was front and center at the OFN conference, where Rep. Young Kim (R-CA) and Sen. Mark Warner (D-VA) delivered keynote remarks. Both emphasized the benefits of CDFIs to Americans nationwide, particularly rural communities and historically marginalized groups. Sharing his own professional trajectory, Warner reiterated that CDFIs are essential to supporting small businesses, housing, jobs, and workforce development.
“We can’t guarantee everyone success, but we should be able to guarantee everyone a fair shot,” Warner concluded.
Rep. Kim also joined Sen. Crapo in leading a Republican-only letter calling on the Trump Administration to “carry out the statutory obligations of the CDFI Fund that are essential to ensuring private investments reach our states and districts.” At the time of their remarks, the letter had more than 40 signatures. As OFN attendees participated in Capitol Hill meetings, signatures continued to grow. By October 23 — the conference’s final day — 105 Republican lawmakers had signed the letter, which was issued to Treasury Secretary Scott Bessent and OMB Director Russell Vought. Although the letter echoed the administration’s language blaming Democrats for the shutdown, many CDFI supporters viewed the show of Republican pushback as a meaningful win for the field.
Such broad support is not accidental — it reflects decades of policy advocacy and relationship-building. Since partnering with President Bill Clinton to create the federal CDFI Fund in 1994, CDFI leaders have cultivated trust through data, impact stories, and responsive product design. This long-term investment has helped shield CDFIs from much of the political volatility surrounding DEI debates.
Still, federal dollars alone cannot sustain most organizations. Research from the Aspen Institute notes that “CDFI loan funds face a common capitalization challenge as they seek to grow,” requiring them to combine federal funding with philanthropic grants and bank capital to meet operating costs while keeping rates affordable. With federal funding uncertain, CDFIs are increasingly exploring innovative partnerships to strengthen sustainability. Throughout the conference, speakers highlighted strategic collaborations as key to leveraging limited resources and adapting to evolving community needs.
Innovating beyond federal funding
Banks and philanthropic institutions will continue to be essential partners. On October 20, the conference’s opening day, multiple banking associations sent a letter to the Treasury and OMB urging the preservation of the CDFI Fund, calling it “one of the federal government’s most effective, market-based strategies for fostering economic opportunity and expanding homeownership in low- and moderate-income communities.” Major banks — including Bank of America, JP Morgan Chase, PNC Bank, Capital One, and Wells Fargo — served as top conference sponsors, reinforcing their financial commitment to the CDFI sector.
Dan Letendre, Managing Director of CDFI Lending & Investment at Bank of America, opened the conference by underscoring CDFIs’ strategic importance to mainstream institutions. “We will step into this moment of CDFI investing, not step back…CDFIs make our bank better,” he said. “Investing in CDFIs is good business, it’s prudent business.”
During the event, OFN announced a $45 million strategic partnership with Capital One to bolster CDFIs and expand economic opportunity nationwide. This initiative aligns with OFN’s vision for a “Third Wave” of CDFI impact and Capital One’s Community Benefits Plan. OFN also unveiled a $5 million match campaign with Focusing Philanthropy to increase small-business and housing investments — a move expected to activate significant new capital for communities and strengthen CDFIs’ role as critical collaborators across the financial ecosystem.
States are also emerging as an important source of support. State and regional CDFI coalitions convened to share lessons and explore new approaches to expand funding locally. In places like Virginia and California, advocacy efforts have already resulted in dedicated state CDFI funds. Across the country, many CDFIs are assessing how state, regional, or even municipal financing might help fill gaps created by federal uncertainty.
Confidence amidst uncertainty
The government shutdown ended on November 12 with a Senate agreement requiring all federal employees laid off during the shutdown to be reinstated. The House has since approved a $276.6 million appropriation for the CDFI Fund. Still, as the Trump administration continues to scrutinize programs it views as misaligned with “executive priorities,” CDFIs remain mindful of their public positioning.
Yet the OFN conference made one thing clear: the field is not standing still. Drawing on decades of experience, CDFIs are doubling down on innovation, partnerships, and adaptive strategies to meet community needs. Even in a moment of political unpredictability, the sector’s commitment to expanding equitable access to capital remains unwavering — and it’s confidence, well earned.
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You can find more from Elizabeth Gilbert Kaetzel on Impact Entrepreneur here.
