Banks say they want to make loans, as well as grants, to nonprofit organizations. That’s what we heard recently from bankers attending Investment Connection programs across the Tenth District. While nonprofits typically request grants, bankers said that they would like more opportunities to lend funds. Loans can be a valuable tool for nonprofits and banks alike, and in 2019, the Federal Reserve Bank of Kansas City plans to focus on assuring the tool is understood and used.

Investment Connection connects community organizations with potential funders, including banks, which receive Community Reinvestment Act (CRA) credit for grants or loans to eligible projects. Investment Connection has created more than $31.3 million in funding connections between banks and nonprofits. It also has led to many volunteer (Community Development Service) activities, and it continues to educate and inform funders of organizations and areas of focus affecting your communities.

Learn from successful loan requests
First, I want to highlight a few loan requests presented last year by nonprofits. Each received positive interest from funders, though they have not finalized or closed on their entire lending needs. Also, I want to remind funders that all approved proposals, including those that presented in recent years, are online. Just request “loan” as a search option.

Here are a few proposals with a lending opportunity as part of their proposal:

• New Mexico Mortgage Finance Authority, $5 million request—Community Development Lending Program with MFA, statewide reach;
• REI Oklahoma NW, $2 million request for REI Down Payment Assistance CRA Fund—long-term loan with statewide reach; and
• NM Habitat for Humanity—Mesa del Rio 3 Construction Loan/Line of Credit of $100,000 for their housing development in Albuquerque.

For these and more proposals go to the website and check out the funder portal. If you want to learn more, we’re always available for you to reach out to with ideas for improvements in Investment Connection.

Loan requests are a priority in 2019

Secondly, for the 2019 Investment Connection request for proposals, we are going to give priority to organizations that have lending and line of credit needs as part of their proposals, though their proposals may also request an investment/grant. Our hope is that this will provide the bankers with additional lending opportunities throughout their markets.

Nonprofits may submit funding requests online at any time. In addition, this year we have scheduled several Investment Connection programs, which give eight nonprofits the chance to present and answer questions from an audience of bank and philanthropic funders.

Upcoming Investment Connection programs in the District:
April 16: Investment Connection New Mexico, Albuquerque
Aug. 14: Investment Connection Colorado, Denver
September: Investment Connection Oklahoma, Tulsa (date TBA)
Oct. 2: Investment Connection Kansas City, KC
Nov. 14: Investment Connection Nebraska, Omaha

Share your stories with us!
Lastly, if you made a connection through Investment Connection that you’d like to highlight, contact me at ariel.cisneros@kc.frb.org. We use these stories to share the positive interaction between funders and community organizations and their effect in the community.

Questions about Investment Connection?

Check the site or call the senior advisor in the office nearest you: Kansas City, Denver, Oklahoma City, or Omaha.

Editor's note: Ariel Cisneros received the first Janet L. Yellen Award for Excellence in Community Development in December 2018. The award honors outstanding achievement in community development activities and those who embody Yellen’s commitment to low- and moderate-income communities. Cisneros led the creation and growth of Investment Connection, which translates a complex investment process into a simple application. It has expanded from banks to include government and philanthropic funders, and expanded from the Kansas City Fed in 2018 to the Federal Reserve Bank of St. Louis and the Federal Reserve Bank of Minneapolis.

Author

Ariel Cisneros

Senior Advisor

Ariel Cisneros is a Senior Advisor at the Federal Reserve Bank of Kansas City—Denver Branch. Cisneros focuses on the community and economic development informational needs of ban…