Trump's order threatens Philly's community financing programs

A federal program that has helped low-income entrepreneurs for 31 years is at risk due to an executive order signed by President Donald Trump. This order aims to reduce government bureaucracy, which could lead to cuts in the Community Development Financial Institutions Fund (CDFI). This fund provides millions of dollars each year to local nonprofits that offer small business loans. Advocates are concerned that without federal support, many community projects could fail. For example, a $4 million loan from a local CDFI helped turn an abandoned warehouse in North Philadelphia into a grocery store. However, future projects may struggle if funding is cut. Many local businesses reported being in "poor" financial condition. Some funding for local organizations has already been frozen this year. Although a judge lifted the freeze, uncertainty remains. Nonprofits rely on federal money to leverage much larger loans, which helps create more funding for local projects. Without federal oversight, community financing could collapse as private banks depend on certified organizations for their donations. The Reinvestment Fund in Philadelphia noted that their efforts to provide financing in low-income areas could suffer. Leaders in the community have expressed frustration about the lack of funding security. They emphasize the importance of Community Development Financial Institutions in supporting businesses that traditional banks often overlook. If federal support is removed, local nonprofits may need to find alternative funding methods, potentially charging businesses for services. Some worry that this could lead to higher loan rates and limit access to resources for small businesses. U.S. Treasury Secretary Scott Bessent stated the administration values the role of CDFIs in supporting economic growth and community development.