Title: NOTE 4 COMMUNITY DEVELOPMENT FINANCIAL INSTITUTIONS BOND GUARANTEE PROGRAM
Accounting Policies: The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal award activity of Opportunity Finance Network and Subsidiaries (OFN) under programs of the federal government for the year ended December 31, 2023. The information in the Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the Uniform Guidance). Because the Schedule presents only a selected portion of the operations of OFN, it is not intended to and does not present the financial position, changes in net assets, or cash flows of OFN. Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
De Minimis Rate Used: N
Rate Explanation: OFN has not elected to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance.
The Community Development Financial Institutions (CDFI) Bond Guarantee Program (Bond Program) was enacted through the Small Business Jobs Act of 2010 (Public Law 111-240) on September 27, 2010. The legislation directs the Treasury Department to guarantee the full amount of bonds issued to support CDFls that make investments for eligible community or economic development purposes.
2013 Bond
In 2013, the CDFI Fund approved OFN to serve as a qualified issuer and issue a $100 million, 29.5-year bond on behalf of Clearinghouse CDFI, an eligible CDFI under the Bond Program. As a qualified issuer, OFN's primary duties are as a program administrator, monitoring Clearinghouse CDFls compliance with all Bond Program requirements. OFN and Clearinghouse CDFI have executed bond loan documents and Clearinghouse CDFI drew down the bond totaling $100 million during 2014 through 2016.
During the year ended December 31, 2023, Clearinghouse CDFI made repayments totaling $3,341,844. As of December 31, 2023, the outstanding amount of the 2013 bond payable is $63,360,257.
As of December 31, 2023, the amount of $66,702,101 is included in federal expenditures in the Schedule. The amount represents the outstanding bonds payable balance at December 31, 2022. There were no draws in 2023.
2015 Bonds
In 2015, the CDFI Fund approved OFN to issue eight additional 29.5-year bonds on behalf of eligible CDFls under the Bond Program totaling $227 million. OFN issued a second $100 million bond on behalf of Clearinghouse CDFI and $127 million on behalf of the following seven CDFls: Community Ventures Corporation, Community Loan Fund of New Jersey, Inc., Citizen Potawatomi Community Development Corporation, Bridgeway Capital, Inc., Federation of Appalachian Housing Enterprises, Inc., Kentucky Highlands Investment Corporation and The Chicago Community Loan Fund.
OFN and the eligible CDFls executed bond loan documents, and the eligible CDFls drew down upon the bonds during 2016 through 2023. The table below represents bond activities during the year ended December 31, 2023:
As of December 31, 2023, the amount of $181,493,864 is included in federal expenditures in the Schedule. The amount represents the outstanding bonds payable balance at December 31, 2022. There were no draws in 2023.
2017 Bond
In 2017, the CDFI Fund approved OFN to serve as a qualified issuer and issue a $145 million, 29.5-year bond on behalf of eight eligible CDFls under the Bond Program: Building Hope. A Charter School Facilities Fund, Coastal Enterprises, Inc., Community First Fund, Florida Community Loan Fund, Inc., Greater Minnesota Housing Fund, Homewise, Inc., Housing Trust Silicon Valley and Impact Seven. During 2019, Coastal Enterprises, Inc. withdrew from the Bond Program, leaving a total bond commitment of $125 million. The table below represents bond activities during the year ended December 31, 2023:
As of December 31, 2023, the amount of $78,433,826 is included in federal expenditures in the Schedule. The amount represents the outstanding bonds payable balance at December 31, 2022, of $78,433,826. There were no draws in 2023.
2019 Bond
In 2019, the CDFI Fund approved OFN to serve as a qualified issuer and issue a $100 million, 29.5-year bond on behalf of three eligible CDFls under the Bond Program: Community Loan Fund of New Jersey, Federation of Appalachian Housing Enterprises Inc. and Greater Minnesota Housing Fund.
The table below represents bond activities during the year ended December 31, 2023:
As of December 31, 2023, the amount of $87,691,432 is included in federal expenditures in the Schedule. The amount represents the outstanding bonds payable balance at December 31, 2022, of $78,677,450 plus the 2023 draw down of $9,013,982.
2022 Bond
In 2022, the CDFI Fund approved OFN to serve as a qualified issuer and issue a $130 million, 29.5-year bond on behalf of three eligible CDFls under the Bond Program: Charter School Development Corporation, Greater Minnesota Housing Fund and Community Ventures Corporation. As of December 31, 2023, the amount of $9,802,000 is included in federal expenditures in the Schedule. The amount represents the outstanding bonds payable balance at December 31, 2022, of zero plus the 2023 draw down of $9,802,000.