Protecting a vital small-business tool
As a small-business owner working from Oklahoma, I am deeply troubled that funding for the U.S. Treasury’s Community Development Financial Institutions Fund (CDFI Fund) is under threat.
People may not have heard of the CDFI Fund, but they’ve probably seen the results of its work, whicharecrucial to small businesses like mine that create jobs and serve communities across our state.
Two years ago, I formed Honor Capital alongside five veterans — including my son and his Naval Academy classmates — who had just returned from service overseas. We were looking for a way to strengthen our hometowns and support fellow veterans wanting to do the same. We began to open Save-ALotgrocery stores in“food deserts”where affordable, healthy food is scarce. Along the way, we have been empowering veterans to become store operators, entrepreneurs and business leaders.
We are currently opening three new stores, one each in Oklahoma City and Altus, and another in North Carolina. Once we do, we will have grown from one store in 2015 to 10 stores in six states. When all 10 are open, we expect 40,000 low-income families will shop with us every week and more than 200 jobs will be created in communities longing for economic growth.
This growth would not have happened without CDFIs. When we were looking for capital to open our first store, banks turned us down again and again because we did not fit their tightly defined box for small-business lending.
Fortunately, CDFIs like Enterprise Community Loan Fund, IFF,the Reinvestment Fund, and the Tulsa Economic Development Corporation looked beyond the credit check box and considered our potential and the impact we could have. They saw the need in the communities we sought to serve, and believed in our mission and potential. They stepped up when banks didn’t.
There are thousands of similar stories across the country thanks to CDFIs, which help innovative small businesses that cannot otherwise access financing. Last year, CDFIs supported by the CDFI Fund created 36,000 jobs, financed 34,000 homes and provided loans to 11,000 small businesses nationwide. If Congress eliminates the CDFI Fund, people in communities like Oklahoma City and Altus will suffer. We cannot afford to toss aside effective programs that support job creation, small businesses and entrepreneurship.
CDFIs have an entrepreneurial approach themselves and are a model public-private partnership. Most money invested by CDFIs comes from private investors. The modest government support provided by the CDFI Fund enables CDFIs to leverage significant amounts of money fromnon-government sourcesto bolster American families, our communities and economy. CDFI Fund resources allow CDFIs to take smart risks when investing in businesses like Honor Capital that bring opportunity to those who have been overlooked.
The market-based approach of CDFIs, and their remarkable track record, have earned bipartisan support in Congress. My thanks to Sen. James Lankford for his leadership in supporting a budget of $248 million budget for the CDFI Fund; I urge his colleagues in the House to follow suit, given the tremendous impact of the program in Oklahoma and throughout the nation.
After all, supporting the CDFI Fund is a clear victory for taxpayers interested in supporting our veterans, local small businesses and creating jobs here in Oklahoma.
Allen, of Tulsa, is president of Honor Capital LLC.