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By Community Partners

From Farm To City: How ChoiceOne Bank is Championing Michigan Agribusiness

ChoiceOne Bank’s vision isn’t a secret: it’s front and center on its website. “We want to be the best bank in Michigan,” said Adom Greenland, the bank’s chief financial officer. “That means really making an impact in our communities.”

ChoiceOne Bank was established in 1898 as a farm bank, and the bank operates in some of the most diverse and abundant agricultural regions in the United States. Over the years, its footprint has grown to encompass urban areas like Grand Rapids; however, despite being located in a metroplex of roughly one million people, ChoiceOne hasn’t lost touch with its rural roots. The community bank continues to serve towns with fewer than 15,000 residents, where ChoiceOne is often the last bank left standing. At one of its branches, ChoiceOne Bank even has a hitching post, which gets frequent use for tying up horses.

Today, as an agricultural lending partner, ChoiceOne Bank serves hundreds of agricultural businesses in Michigan, from local farms to international distributors that produce everything from apples to asparagus and blueberries to dairy products. In fact, outside of California, Michigan has the most number of agricultural products of any other state in the country.

Prior to joining ChoiceOne Bank as its chief lending officer, Brad Henion worked in both the Chicago and California markets before coming home to Michigan. According to him, ChoiceOne Bank’s farming customers face a host of challenges, including securing labor, paying for equipment, and keeping up with ever-evolving technology—not to mention managing familial succession plans that can stretch back centuries. Despite those realities, Brad and his team are confident that they’re able to meet their customers’ needs.

For example, ChoiceOne knows that unforeseen events, such as extreme weather, can either reduce yields or completely wipe out crops. In those situations, the bank will do things like delay payments for a year, which provides farmers enough time to plant and harvest other crops that can support the earlier payment.

ChoiceOne Bank’s Chief Lending Officer, Brad Henion

Another example of how ChoiceOne has adapted its practices to better meet the needs of its customers is how it lends to apple-farming operations. When an apple farmer plants a tree, they know they won’t get a harvest for four years. In other words: the farmer will have no revenue for four years, just growing costs. Therefore, ChoiceOne developed a loan program where farmers make interest-only payments until they begin to earn revenue. “A lot of banks don’t feel comfortable underwriting the types of inconsistent revenue streams that farmers have,” Brad said, “but we’ve been doing this for 125 years. It takes a bank like us to understand the farming industry, create unique products, and really work with farmers.”

Using Direct Deposits to Sow Seeds of Trust

Many farms in ChoiceOne Banks’ footprint rely on help from seasonal workers who enter the United States legally to assist in the various labor-intensive aspects of agricultural operations. These unbanked workers tend to travel from Spanish-speaking countries in Central and South America, although some come from as far away as South Africa. Beginning around 2015, there was an influx of the number of skilled workers traveling to Michigan farms as part of the government-sponsored H-2A Visa program.

At first, farmers paid these H-2A workers using paper checks; however, that created three problems. First, it was time-consuming for the farmers to manually run and issue physical checks. Second, it was time-consuming for the workers, who had to be bussed in from farms to wait in line at a bank in order to cash their checks. Lastly, given the amount of cash earnings they had on them, these workers were particularly at-risk for losing their seasonal earnings, whether through robberies or scams, in Michigan, while traveling home, or in their countries of origin.

Carrie Olson, ChoiceOne Bank’s Treasury Management Officer

That’s when ChoiceOne Bank saw an opportunity both to serve its agricultural customers and to help build trust in the United States’ financial services industry. In 2018, the bank launched the Growers Program, a deposit program created for ChoiceOne’s farming customers to be able to provide their H-2A visa-holding workers with safe and efficient banking. Through the Growers Program, workers can choose between one of two direct deposit options. The first is a pay card program through a bank partner. The second is a checking account with ChoiceOne Bank. Should they choose the latter, workers get mobile banking access (with no minimum balances or monthly service fees), free electronic statements, and two ATM/debit cards: one for them and one for their family in their home country. Regardless of which option a worker chooses, they also receive access to Spanish-speaking customer service.

Carrie Olson, ChoiceOne Bank’s treasury management officer, has been with the bank for more than 12 years. She helped to bring the program to life. According to her, early on, it took a lot of convincing to get farm workers to try out the program. Despite the fact that she traveled from barn to barn with a bilingual colleague, workers were skeptical of the banking industry. Her and her team, however, remained persistent as they coached workers through the ins-and-outs of direct deposit, where to find ATMs in countries like Mexico, and how to use them. Today, thanks to their early efforts, when Carrie and her colleagues go to a field to present to farm workers now, many of those returning workers from past seasons are doing the majority of the talking. “We’ve really been able to build that trust,” Carrie said. “We’ve taken people from underbanked and impossible-to-bank to fully banked and safer for everybody.”

Growing Empathy Through Spanish-Language Services

Since 2018, ChoiceOne Bank has continued to see measured, linear growth to its Growers Program in a way that very much complements its agricultural portfolio and embodies its mission. ChoiceOne Bank is not only seeing fewer Growers Program accounts go dormant, but more accounts are receiving direct deposits from farms in other states, including Florida and Washington, as seasonal workers move around the country following different planting seasons.

Additionally, investing in Spanish-speaking services for the Growers Program has subsequently helped Spanish-speaking permanent residents in ChoiceOne Banks’ communities who’ve historically struggled to get financial services in their preferred language. For example, the bank has placed an emphasis on recruiting bilingual employees. Also, in years past, ChoiceOne Bank brought in a bilingual Spanish teacher after hours to work with any interested employees. Employees were paid for their time, and many customer-facing team members took advantage of the opportunity to gain those language skills to better connect with their customers.

Going forward, Carrie says that she and her team would like to continue to grow the Growers Program at a pace of a farm-a-year and to develop more bilingual resources to help community members—whether permanent residents or seasonal workers—continue to overcome language barriers. Adom agrees. “Offering these services in Spanish has helped us have more empathy,” he said. “Serving these folks better has helped us serve everybody else. It’s allowing us to better serve our community and be a better community bank.”

Learn More:

  • ChoiceOne Bank
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.

 

By Community Partners

How Asian Bank Is Providing Personalized Support To Philadelphia’s Small Business Owners

In a word, Tina Miao-Granatt would describe her life as “blessed.” Her family moved from Taiwan to Philadelphia when she was 12 years old. There, her parents owned and operated a successful Chinese restaurant. As the small business grew and grew, so too did Tina’s list of responsibilities, from dishwasher, to busser, to waitress. Although she spent most of her weekends working in her parent’s restaurant as a teenager, it turned out to be a formative experience for Tina. “I understand the struggle for small business owners,” she said, “especially in minority communities. I know it’s really, really hard for them to succeed.”

Tina’s ability to empathize and connect with small business owners is ultimately what led her to getting a job at Asian Bank, a CDFI and Asian-owned Minority Depository Institution headquartered in Philadelphia’s Chinatown. Asian Bank was founded in 1999 to serve low- to moderate-income, BIPOC, and immigrant communities. Since its inception, Asian Bank has grown to two, soon-to-be three, branch locations and $515 million in total assets while working to increase banking access to those that are un- or underbanked. Additionally, the bank provides lending on small business, real estate, and affordable housing.

Tina Miao-Granatt, Community Outreach Liaison at Asian Bank

A cornerstone to Asian Bank’s lending approach is to be flexible in underwriting small business and real estate loans, which requires not just knowing community members’ stories, but understanding those stories and knowing where and how to provide assistance. That’s where Tina comes in. In 2023, Tina moved from California to Philadelphia without a job. Because she lived close to one of Asian Bank’s branches, she applied for a teller position; however, her interviewers looked at her past small business experience and decided to create a position for her: community outreach liaison.

In her role at Asian Bank, Tina works one-on-one with clients to open accounts, apply for residential mortgages, get a secure safety deposit box, and purchase CDs; however, an equally important part of her job is to provide individual support to small business owners to help them through the lending process, regardless of what language they speak. For example, recently, Tina has primarily been working with bodega owners. Despite not speaking Spanish, Tina has forged a close relationship with the Dominican Grocery Association, and she relies on Google Translate to text with Spanish-speaking small business owners in her community who are looking for business loans but who’re too intimidated to approach large, national banks. Additionally, Tina has made a point to have all of Asian Bank’s loan document requirements to be translated into Spanish, Chinese, Vietnamese, Cambodian, and other languages that reflect the surrounding community’s linguistic diversity.

All the photos for this interview were captured at a financial literacy seminar hosted by Asian Bank for the Dominican Grocery Association

When Tina first connects with a small business owner who wants to apply for a loan at Asian Bank, she has to get a sense of their financial well-being. That includes going through their tax returns and, oftentimes, discussing their low credit scores. According to Tina, many small business owners in Asian Bank’s footprint are exactly like her parents; that is, they primarily use cash and do not have credit cards, open lines of credit, or debt. Therefore, many individuals that Tina works with have low credit scores that hinder their ability to be approved for loans, especially from traditional banks, which often require a credit score of at least 700. However, by investing time to get to know small business owners in her community, Tina can get a more complete picture of someone’s financial and personal histories. That allows her to get the documentation and narrative she needs to work with Asian Bank’s loan officers and underwriters to in turn get those loans approved.

Even after a loan closes, Tina continues to touch base with Asian Bank’s loan recipients to see how they’re doing. “I let them know they can text me anytime they want,” she said, “and it doesn’t have anything to do with their loan. I help them answer their questions about reporting taxes, credit card rates, building credit. That’s really important, especially with minority communities that don’t have anybody to turn to when it comes to their finances.”

Individualized Support for Community Impact

In addition to coaching small business owners through Asian Bank’s loan application process, Tina similarly assists entrepreneurs in her community in applying for local grants. For example, there’s a grant program through the Philadelphia Business Lending Network that’s available to local small business owners with five or fewer employees and less than $250,000 in revenue. Selected recipients qualify for either up to 50% of their loan amounts or $35,000, whichever is less. What Tina will do is help small business owners get approved for a loan through Asian Bank, and then she’ll work with them to apply for the citywide grant. For a small business owner looking to purchase new equipment and expand their business, the loan-grant combination can be transformative.

Tina shared one story about a local small business owner named Kim, a single mother, who wanted to expand her beauty salon, Four Season Nail and Spa LLC. Tina helped Kim to get a $70,000 loan through Asian Bank and then $35,000 through the Philadelphia Business Lending Network grant program. The key to making that happen, Tina said, was working with Kim to itemize exactly how the money would be spent. In other words, Tina and Kim spent hours researching how much it would cost to purchase everything from styling chairs and massage tables to nail polish and face towels. “We want to help the people that really appreciate and need this grant,” Tina said. “That means really getting to know our clients and really understanding where they’re going with their vision so that we can be a part of it.”

Unsurprisingly, an important aspect of Tina’s job at Asian Bank also happens to be one of her passions: financial literacy. According to Tina, she wants to help people “break the cycle” of low credit scores and all-cash retirement savings. To do that, this year, Tina will begin hosting a free financial literacy seminar series in different communities around Philadelphia. Individual seminar topics will include tax reporting, successful small business ownership, and credit building. Additionally, Tina and Asian Bank are partnering with the Small Business Development Center to also present the seminars in Spanish.

Very much like her years spent working weekends at her family’s restaurant in Philadelphia, today, Tina represents Asian Bank at various events, workshops, and community gatherings outside of traditional business hours. Alongside her colleagues at Asian Bank, she also serves as a pitch coach for Goldman Sachs 10,000 Small Businesses and she volunteers with Black Squirrel Collective, a Philly-based organization committed to investing in Black-owned suppliers and creating sustainable neighborhood investment. In other words, as Asian Bank’s community outreach liaison, Tina is busy. “I really like what I do,” she said. “I like being in this position to connect people to the right products we offer, and I enjoy how I can help out my community.”

Learn More:

  • Asian Bank, a CDFI and Asian-owned Minority Depository Institution headquartered in Philadelphia’s Chinatown.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Community Partners

Meet Beardstown Savings, The Community Bank That’s Speaking The Same Language As Its Multilingual Community

Rich Eckert never expected to become the president and CEO of a community bank. The Pittsburgh, Pennsylvania-native aspired to work in collegiate athletic administration, which he did for a short while before moving with his wife to her hometown of Beardstown, Illinois to start a family. However, a chance encounter with the then head executive of Beardstown Savings ultimately changed Rich’s career trajectory and opened the door for him into the world of community finance. “He asked me if I wanted to work in the bank,” Rich recalled. “I said ‘I’ve only stepped my foot in a bank one time in my life, and that was to open my account.’”

Rich Eckert, President and CEO of Beardstown Savings

Rich interviewed for the position, and in late 2015, Beardstown Savings hired him as a loan officer. According to him, getting into banking felt both like a natural fit and a full-circle moment. Growing up, Rich’s parents had a house foreclosed on them, which was an experience that left a lasting impression on him. At Beardstown Savings, that formative memory translated into Rich wanting to do everything he could to help people in his community. “Community banks, as a whole, don’t want to pull the rug out from under our customers,” he said. “Personally, I’ve seen the other side of how that can destroy and displace a family. We don’t want to do that. We want to work with our community members through the whole process of the good, the bad, and the ugly.”

Despite Rich’s new-found passion for banking, he felt like he still had a lot to learn. According to Rich, he benefited from on-the-job training and mentorship from the bank’s leadership team, who encouraged him to attend banking school. Therefore, Rich enrolled in the Graduate School of Banking at the University of Wisconsin-Madison, where he received high-level training in areas ranging from human resources and banking technology to marketing and leadership. Simultaneously, Rich continued to rise up the ranks at Beardstown Savings. By 2017 he was the vice president of lending, and a little over a year later, he took over as the bank’s president and CEO. The learning curve was steep, but Rich had no choice but to learn as quickly as he could. With the support—not to mention patience—from Beardstown Savings’ board and his colleagues, Rich was ultimately able to settle into his leadership role, develop his management style, and find new ways for Beardstown Savings to serve its community.

Banking the Whole Community

Beardstown Savings is a mutually owned bank that was founded in 1880. Today, the bank has two locations and 15 employees, including team members who’ve been there for decades and others who are work-study students just launching their careers. Unsurprisingly, the town in Central Illinois has transformed significantly since the bank’s inception, shifting from a small, rural, predominantly white community to a small, rural melting pot. Newcomers include migrant workers who are drawn to the area’s two largest employers: JBS Foods and Dot Foods. Rich estimates that between 70 and 80% of his community works for either of those two companies.

As Beardstown has changed over the years, so too has Beardstown Savings had to evolve to keep up with those shifting demographics. For example, the community bank has hired bilingual staff members who can better connect with and serve customers in both Spanish and French. Additionally, Beardstown Savings forged a partnership with Worldwide Tech Connections, thus becoming the first bank in the country to sign up with the translation services software company. According to Rich, although customers still prefer to be able to interact with a bilingual staff member in person, given the growing linguistic diversity of Beardstown’s residents, it’s not always possible to have someone on staff who speaks the same language as a community member. Today, through a mobile or desktop device, the bank can communicate one-on-one with customers, either through voice or text, in more than 50 different languages and dialects. The software also allows Rich and his team to translate letters, emails, notices, and signage within seconds to better serve customers, regardless of what languages they speak.

Last year, Beardstown Savings’ efforts were acknowledged by the Community Bankers Association of Illinois (CBAI), who selected the community bank’s entry, “Banking the WHOLE Community,” as the recipient of the Excellence and Innovation FORVIS Award. “We pride ourselves in offering bank services to all customers regardless of background or demographics, which includes language barriers,” Rich said. “As a small bank, we are accomplishing a lot and doing a lot of good work in our community with our limited resources, and we are tremendously honored to have received this award.”

Tackling the Housing Crisis

Language barriers, however, are by no means the Beardstown community’s biggest challenge. Instead, like the rest of the United States, the town is in the throes of a housing crisis. In Beardstown, the average mortgage for first-time home buyers hovers somewhere between $40,000 to $70,000. However, that’s not the problem. The challenge is that, as Rich puts it, “Beardstown doesn’t have that next home” for when people want to grow their families or move into a larger space. That issue is compounded by the reality that it costs more than $125,000 to build that next $125,000 home.

Subsequently, two things are happening. First, the pool of homes available to first-time homebuyers is shrinking. Second, Beardstown’s low housing inventory means that people are moving in with relatives, which can sometimes result in upwards of eight or nine people living together in the same small house, said Rich.”That’s unsafe in a lot of ways, but it’s not because these families don’t want to buy a house or that they’re skirting the system. They just don’t have anything to buy.”

To assist his community where he can, Rich is working with local leaders to change how Beardstown’s tax increment financing (TIF) programming works so that a portion of those monies can go toward creating new housing. Additionally, Beardstown Savings has partnered with Federal Home Loan Bank of Chicago, CNote’s Impact Cash® program, and others to channel both grant and investor’s impact dollars into helping to solve Beardstown’s housing woes. Such partnerships have allowed Beardstown Savings to keep its cost of funds as low as possible, which it then passes onto its customers in what Rich calls a “win-win-win” for everyone involved.

The impacts have been tangible. Given Beardstown’s small size, Rich says that Beardstown Savings is able to funnel outside dollars into its community very quickly, thus creating impact very quickly. “We’re not looking to reinvent the wheel, and we don’t need a fat bottom line,” said Rich. “We just need to be the service-oriented institution that we are, which means doing what we can to meet people where they’re at to solve these issues, not for Beardstown Savings, but for Beardstown the community.”

Learn More:

  • Beardstown Savings is a mutually owned bank located in Beardstown, Illinois that was founded in 1880.  Beardstown Savings offers an extensive product line that includes checking and savings accounts, MMDAs, CDs, home mortgage loans, and consumer loans . 
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Community Partners

How Labor Credit Union Is Creating Opportunities And Expanding Its Impact With Dora Financial  

Thomas Domingue is passionate about opportunities. More specifically, the CEO of Labor Credit Union is passionate about creating opportunities for those around him. It’s a personal mantra that Thomas has woven through his professional journey, which, prior to joining Labor Credit Union, included 13 years working for various multibillion-dollar credit unions. Unsurprisingly, when Thomas joined Labor Credit Union in January 2020, he brought his personal mantra with him. For a credit union that’s been creating opportunities in its community for nearly 90 years, it’s been a perfect match.

Thomas Domingue, CEO of Labor Credit Union

Department of Labor Credit Union, better known as Labor Credit Union, was founded in 1935 to serve employees, retirees, and immediate families of The United States Department of Labor, including partnered organizations. Since its inception, the credit union’s roots have been firmly planted in the labor movement. In addition to offering its members a full suite of banking services, Labor Credit Union remains as committed to worker rights, financial literacy, and economic empowerment as it was when it was first established.

Hina Khalid, CFO of Labor Credit Union

When Thomas joined Labor Credit Union, he was one of 18 employees. Six months later, however, that number grew to 19 when the credit union hired Hina Khalid as its CFO. Prior to entering the credit union world, Hina’s 19 years of career journey took her through various financial services institutions and roles in energy, broadband and economic development. Upon joining Labor Credit Union, her goal was to leverage her  diverse professional experiences into forging innovative and strategic partnerships that would help the credit union to further its mission.

One such partnership began in 2023, when Hina attended a DEI event at CUNA’s Governmental Affairs Conference (GAC) in 2023. That’s where she learned about Dora Financial, a marketing and innovation credit union service organization (CUSO). Dora was founded by USALLIANCE Financial in 2021 as a bilingual neobank to serve the 50 million Americans currently not participating in mainstream banking. Dora’s app allows users to perform a range of financial transactions, including direct deposit, mobile check deposits, and bill pay in both Spanish and English. Dora charges no monthly fees and it doesn’t require a minimum balance. Additionally, Dora’s users have access to a surcharge-free network of more than 30,000 ATMs across the country. “I found Dora’s mission and what they’re trying to achieve to be very much aligned with our mission to reach underserved communities,” Hina said, “and I was impressed to hear the impact that Dora is making.” As of December 2023, nearly 7,000 individuals had opened accounts with Dora.

Hina pitched Dora to Thomas, who bought in right away. Labor Credit Union’s CEO was particularly interested in Dora’s willingness to connect with individuals who’ve been traditionally shut out of mainstream banking and to provide them with key financial services. “We’d been talking about serving underserved and underbanked demographics for a long time,” he said. “These demographics need financial services, but most banks won’t touch them, so this was a partnership that we really needed to pursue. It was important for us to put our money where our mouth is.”

Within a few months, Thomas, Hina, and Amber Mooney (VP of Member Experience), the Executive Team of Labor Credit Union, completed their due diligence and got their board’s approval to become a funding sponsor of Dora Financial, joining Affinity Plus Federal Credit Union, Digital Federal Credit Union, Inclusiv, Service Federal Credit Union, and USALLIANCE Financial. Not only is each of Dora’s six funding sponsors trying to bridge the economic gap that exists for those who do not have access to banking, but they also all bring a wealth of experience to the table. For example, members of each institution, including Hina, sit on Dora’s board and provide guidance on how to continue to grow the CUSO.

Those board members also advise Dora on how to achieve its goal to help people find a pathway to credit union membership, which is something that Thomas feels strongly about. According to him, Dora has the potential to help rebuild trust between underserved populations and mainstream financial institutions. One way that trust can be established is through financial coaching—something all Dora users can freely access. “Credit unions really excel at building relationships and making an impact,” he said. “Through Dora, we are able to directly help more individuals, improve and enhance their financial position, and achieve their long-term financial goals.”

For Labor Credit Union, however, its involvement with Dora isn’t about growing its membership: it’s about achieving its own long-term goals. Although Thomas and Hina’s 10-year vision for the credit union includes growing its membership numbers, increasing its assets, and expanding its footprint into new markets, those metrics are stepping stones toward Labor Credit Union’s ultimate objective: to have an impact and help people achieve financial success in as many communities as possible. Amber Mooney and her fully vested member engagement team also find this partnership to be directly aligned with their holistic approach towards serving the community. Her marketing team is also eager to partner with CNote’s Impact Cash® platform to help reach and support underserved communities.

That, in part, is what led Labor Credit Union to create its own foundation, which spearheads the institution’s community outreach efforts. Labor Community Foundation aims to cultivate creative economic solutions and develop collaborative educational resources for its membership, through initiatives like scholarship programs and internship opportunities. “Everybody works hard,” said Thomas. “If we can be their partner to help show them how to leverage their hard-earned money into financial well-being, that’s what we want, because then, we’re able to make impacts not just in individual lives, but in households, families, and communities nationwide.”

“Our whole team is very much aligned with Thomas’ vision of creating opportunities for others,” Hina added. “Whether through Dora or our foundation, we want to create opportunities for underserved and underbanked communities throughout the country in every way that we can. We want to be the credit union that’s making a difference.”

Learn More: 

  • Labor Credit Union was founded in 1935 and is organized by and for working people to help them build a foundation of financial strength and success. 
  • Dora Financial is a Credit Union Service Organization (CUSO) founded by USALLIANCE Financial in August 2021 to serve the 50 million Americans currently not participating in mainstream banking. Dedicated to financial inclusion, the app features a fully bilingual digital banking experience that supports individuals with low to moderate income. The goal is to help people find the pathway to credit union membership.
  • CNote’s Impact Cash® platform is a cash management solution designed for FDIC and NCUA insurance coverage that provides institutions a single management point for deposits targeting positive social impact while generating returns. Impact Cash® provides flexible liquidity and the peace of mind that comes from federally insured solutions. 

By Community Partners, Low Income Designated Credit Union

How Freedom First’s Affordable Housing Program Is Taking A Non-Conforming Approach To Homeownership

Allison Wolf got her start in the financial services industry as a college student in 1998, when she took a job as a part-time teller in Long Beach, California. Many things caught Allison’s attention during those formative first few years; however, she found herself particularly entranced by the work of the branch’s loan officers. “It looked like so much fun to be able to help people to achieve their homeownership goals,” said Allison. “It was a simpler model back then, but that’s what got me started.”

Allison Wolf, Housing Advocate at Freedom First Credit Union

In the subsequent years, Allison worked her way up to a regional position, which spanned from San Diego to Santa Maria. Although she loved her job working alongside loan officers and credit analysts, 13 years ago, Allison had the opportunity to pull up her Southern Californian roots and start somewhere new. Allison, her husband, and their dogs piled into their RV, rented out their home, and hit the road to, as she puts it, “see what life would bring.” As it would turn out, life would lead Allison to Roanoke, Virginia, where her husband put himself through medical school and became a nurse, and where Allison went to the local credit union and applied for a job.

That’s how Allison became the Housing Advocate at Freedom First Credit Union. Since 1956, Freedom First Credit Union has been serving communities throughout Virginia’s Roanoke and New River Valleys through local investments, lower rates on loans, higher rates on deposits, and innovative banking services that support members working to build their financial independence. Freedom First is also a CNote Impact Cash® Partner. CNote deploys Impact Cash®  dollars into mission-driven NCUA-insured partners like Freedom First, generating returns on institutional investors’ cash allocations while supporting financially underserved communities across the country.

In addition to its Responsible Rides® program, one of Freedom First’s signature programs is its Affordable Housing program, where Allison and her team take a “common-sense” approach to helping people get into homes, including in some of the most physically segregated cities in the country. In other words, Freedom First is willing to work with unbanked and underbanked individuals and to offer situational lending opportunities to nontraditional borrowers because the credit union knows its community better than anyone. 

Allison Wolf and Frank Miller, Marketing Specialist at Freedom First Credit Union

For example, around Roanoke, the majority of firefighters work about nine 24-hour shifts a month.  Although many of these firefighters also work as emergency room technicians or paramedics, a large percentage of firefighters in Allison’s community work seasonally. Therefore, unlike other lenders, Freedom First is willing to take the average of a firefighter’s seasonal or  part-time income when determining what kind of down payment assistance or first-time homebuyer loan for which they can qualify. Another example may be assisting single mothers who choose to work two part-time jobs versus full time to best align with young children’s school schedules.  Our program also allows for alternate credit documentation for individuals who do not have a credit score. “We really just try to make logical, common-sense decisions,” Allison said. “Especially for things that are common in our market.”

An Ecosystem of Support

Allison and her team are part of a much broader ecosystem of support, both within Freedom First Credit Union and within the surrounding community. For example, Allison works closely with Kim English of the credit union’s Responsible Rides® program and other colleagues within the Roanoke Financial Empowerment Center, which provides no-cost financial counseling services that are vital to helping someone reach their goal of homeownership. Counselors will work with individuals to look through pay stubs, make savings plans, create budgets, and set target credit scores. Unsurprisingly, Allison and the folks within the Financial Empowerment Center often work with members for months, or sometimes even years, to help first-time homebuyers build credit, save for a down payment, access down payment assistance, understand closing costs, find a trusted realtor, and, for unique cases, recommend custom underwriting.

Within the broader community, Freedom First’s Affordable Housing program works through a number of partnerships, including with Habitat for Humanity, the Federal Home Loan Bank of Atlanta, the City of Roanoke, the Community Development Financial Institution Fund, and others. Together, these partners have generated some major impact. For example, in 2022, Freedom First secured $223,000 in down payment assistance for borrowers through partner organizations. Additionally, during that same period, Freedom First distributed $85.6 million in home loans to hundreds of borrowers in southwest and central Virginia from a wide range of loan programs, including the Federal Housing Administration, Veterans Affairs housing assistance, Virginia Housing, the United States Department of Agriculture, and more. Incredibly, $26 million of the total home loans in that same year went to low-to-moderate income borrowers, who made up 31% of the total number of borrowers. Without Freedom First’s Affordable Housing program, many of those individuals wouldn’t have otherwise been able to become homeowners.

An important part of the community network that Allison works within is actually other banks and large financial institutions in her region. According to Allison, neighboring banks and mortgage brokers refer borrowers to her and vice versa. “If there’s a better program for someone at a mortgage company, I happily send them their way,” Allison said. “Those of us who work in this space understand that we can strip our egos and get down to helping folks, because there are so many more people that need our help than we can serve. It’s a pretty humble crowd that we work with.”

By focusing on serving their community rather than competing for borrowers, Allison and her team are able to do some truly inspiring work. That includes getting creative to help people in dire straits to be able to stay in their home by making non-conforming home loans for those who may not qualify for traditional lending. For example, a few years ago, Freedom First partnered with Habitat for Humanity to help purchase a home for a married pair of disabled veterans. However, when one of them passed away, the other was left to carry the mortgage with half of the family’s income source gone. Allison worked with Habitat to refinance the loan and to keep that family from becoming homeless. “Nobody else would have touched that loan, because she didn’t have good credit and it was a low loan amount,” Allison said. “It didn’t look pretty on paper, but we knew that this person was going to do absolutely everything they could to keep that home and that roof over their head, so for us, it was worth the risk.”

Allison Wolf​​​​ and Dave Prosser, SVP of Community Development

A More Holistic Approach to Purchasing

One of Allison’s dreams for the future is for there to be a central hub that borrowers could easily access. According to Allison, she sometimes feels like there are so many resources out there; however, those resources tend to be “so individualized.” If she could wave a magic wand, she’d like to consolidate resources, make processes more efficient, and align funding streams with shared initiatives, whether that’s creating more affordable housing opportunities in formerly redlined neighborhoods or investing more in community land trusts.

For example, Allison is on the board of Renovation Alliance, a nonprofit that focuses on improving the homes and lives of low-income homeowners. The nonprofit, along with Freedom First and other partners participate in Healthy Homes Roanoke,a public-private collaborative that works to make homes in Roanoke healthier, safer and more comfortable for our most vulnerable residents. Partners include The City of Roanoke, Carilion Clinic and other big players with a goal of taking a more holistic approach to funding home repairs. That means that if a home is deemed to need a new roof but the homeowner is on a fixed income, these partners will step up to not just replace the roof, but to also do things like evaluate the windows and conduct any lead-based paint abatement. “They’re pulling all those partners together and doing everything that needs to be done to sustain that home for a long time,” Allison said. “I’d love to one day see that in the world of purchasing.”

 Learn More: 

  • Freedom First Credit Union is a member-owned, federally insured community financial institution headquartered in Roanoke, VA since its founding in 1956.
  • Freedom First’s Affordable Housing Program | Through partnerships with Habitat for Humanity, the Federal Home Loan Bank of Atlanta, the City of Roanoke, the Community Development Financial Institution Fund, and more, Freedom First has a wealth of resources for down payment assistance and non-conforming home loans for those who may not qualify for a traditional mortgage.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Community Partners

How NYU Federal Credit Union Is Forging Partnerships To Support Their Members

Mira Ness comes from humble beginnings: in her words, she was born into a very big family in a very small town in Kazakhstan. Still, Mira found a way to become the president of one of her country’s biggest banks. However, when she moved to the United States with her American husband, Mira found herself in a country that makes it difficult for immigrants to translate their professional skills into meaningful work. Mira struggled to find a financial services job that leveraged her leadership skills, and she was repeatedly passed over for manager positions because of her lack of “American experience.” 

Mira Ness, CEO of New York University (NYU) Federal Credit Union

Eventually, Mira took a job as a customer service representative for a commercial bank. After that, she took a job at an investment bank; however, when she learned that her position was being relocated to Florida, Mira started to look for a new job that would allow her to stay in New York City. That’s how she learned about New York University (NYU) Federal Credit Union, which was looking for a new CEO. Mira interviewed for the position, and in 2006, she was hired as the credit union’s CEO. She quickly discovered that she and NYU Federal Credit Union were a perfect match.

NYU Federal Credit Union was founded in August of 1982 by then-NYU president John Brademas for the benefit of the university’s employees. Since its inception, the credit union’s services have been extended to faculty, alumni, students, retirees, and their family members. When Mira joined the credit union in 2006, it had approximately 2,000 members and roughly $7 million in assets. Today, NYU Federal Credit Union has about 10,000 members and more than $70 million in assets. Additionally, the credit union is a CDFI (Community Development Financial Institution) with a Low-Income Designation, meaning that all interest it accrues is passed on to its members in the form of better rates on loans and lower- or no-fee financial services. According to Mira, 86% of NYU Federal Credit Union’s members are minorities and low-income, which in New York City, means that they make less than $96,000 a year. 

Over the years, NYU Federal Credit Union has expanded what it’s able to offer its members. That includes online banking, Zelle, and Apple Pay, as well as student loan consolidation, quick cash loans, and credit-builder loans. “We are able to provide the loans that our members need,” Mira said. “We’re constantly trying to listen to our members about what they want.” 

Mira Ness with two NYU Federal Credit Union members

One of the first additions that Mira made at NYU Federal Credit Union when she joined 17 years ago was a mortgage program. Within six months of joining, she added five mortgage loans to the credit union’s portfolio, which allowed the credit union to begin making money on interest “right away.” Since then, NYU Federal Credit Union has continued to expand its mortgage program to include mortgage preparedness loans, first-time homebuyers loans, and down-payment assistance loans, which has become the credit union’s most popular offering. 

Given the popularity of its mortgage programs, NYU Federal Credit Union offers numerous financial education and information seminars. Although much of the credit union’s business flows out of these seminars, Mira says that that’s not her and her team’s goal. “Our goal is education and to help people,” she said. “We want people to get the best possible deal, and if someone else is going to be able to give it to them, we tell them to go for it. Educating people and gaining trust is the most important thing.”

Growing Alongside Partners

NYU Federal Credit Union relies on a number of partnerships to serve its members. For example, the credit union partners with Citibank to give its members access to the bank’s sprawling network of ATMs, and it partners with Neighborhood Housing Services of NYC to host its financial education seminars about available housing grants for low income members. It even partners with Citi Bike NYC to provide its members with a considerable discount to access thousands of bikes across New York City, Jersey City, and Hoboken. However, one of NYU Federal Credit Union’s most innovative partner relationships is with United Nations Federal Credit Union, a large, international credit union that has a presence in New York City.

Although NYU Federal Credit Union’s assets have grown considerably since Mira joined in 2006, the credit union is still too small to carry a high number of mortgages on its balance sheet, despite the demand from its membership. Therefore, to meet its members’ needs, the credit union forged a partnership with the United Nations Federal Credit Union. NYU Federal Credit Union sells its mortgages to United Nations Federal Credit Union, but holds onto 10% of each loan. In return, United Nations Federal Credit Union gets to improve its balance sheet, while NYU Federal Credit Union gets to serve more members. Last year, the arrangement resulted in NYU Federal Credit Union earning approximately $400,000 in fees, which Mira says was a “huge boost” to the credit union’s bottom line.

Another partnership that’s proving to be beneficial for NYU Federal Credit Union is with CNote. In 2023, NYU Federal Credit Union became a CNote Impact Cash® Partner. CNote invests Impact Cash® dollars in mission-driven and FDIC- and NCUA-insured partners like NYU Federal Credit Union, generating returns on institutional investors’ cash allocations while supporting financially underserved communities across the country. “Because we need cash flow, and we have to have liquidity for our transactional mortgages,” Mira said, “CNote has been very helpful for us.”

The Right Team Today for Tomorrow

Currently, NYU Federal Credit Union has 14 employees, including Mira. However, in the next few years, she would like to be able to hire more people so that NYU Federal Credit Union can expand its product offerings and better serve its members from its two branch locations. Specifically, Mira would like to hire one or two full-time certified housing counselors to help grow the credit union’s most popular programs. Doing so, however, presents a chicken-egg scenario for the credit union: “you have to make more money to hire people,” said Mira, “and to make more money, you need more employees who can provide services. That’s where our challenge is right now.”

Despite that challenge, Mira is confident that she has both the right team and the right board alongside her to continue to find new and better ways to serve NYU Federal Credit Union’s growing membership. “These people devote their personal time and this team works very hard,” she said. “Nothing can be accomplished by one person.”

The NYU Federal Credit Union team

Learn More:

  • New York University (NYU) Federal Credit Union is a financial cooperative that was created in 1982 by NYU employees under the leadership of James Ramsey, to exclusively serve the NYU faculty, staff, employees, students, alumni and retirees and their family members.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By CNote, Low Income Designated Credit Union

Resources for LID Credit Unions

What are Low Income Designated Credit Unions 

Low-Income Designated (LID) credit unions cater to communities predominantly falling within specific low-income thresholds, as determined by Census Bureau data and NCUA regulations.

The NCUA specifically describes a credit union that can be designated as low-income when “a majority of the credit union’s potential or actual membership qualifies as low-income, meaning their family income is 80 percent or less than the median family income for the metropolitan area where they live or for the national metropolitan area, whichever is greater.” More information about qualifications can be found on the NCUA’s website. 

Many LID credit unions bring vital services to under-resourced communities, providing essential financial services such as loan support, technical assistance, and financial education. These credit unions create an outsized impact for the low-income communities that they serve. But did you know that they also get special benefits for serving these communities? 

LID credit unions have a spectrum of resources uniquely available to them, designed to increase their access to deposits thereby enabling them to make impactful loans, grow their visibility and membership, and create valuable industry partnerships. 

The New Covenant Dominion Federal Credit Union team, an LID credit union based out of the Bronx, New York.

Resources 

Increasing Capital Access 

Non-member and Outside Deposits from any source 

LID credit unions are uniquely eligible to receive nonmember deposits up to $3M or 50% of total shares, whichever figure is greater. At a time when 70% of credit unions are naming growing retail deposits as a high priority, this flexibility is a key benefit that allows LID credit unions to better serve members by promoting lending, small business growth, and job creation. 

Examples of outside sources of capital include corporate impact investors, foundations, depository solutions like Impact Cash®, grants, and donations. 

TA grants and low-interest loans from the Community Development Revolving Loan Fund

 

The NCUA administers the Community Development Revolving Loan Fund (CDRLF) for credit unions. There are two programs within the fund: 

The NCUA provides financial support in the form of technical assistance grants through the CDRLF which help LID credit unions build capacity and provide deeper support to the under-resourced communities that they serve. Award applications typically open in May and must be submitted in June. (Source) 

In 2023, the CDRLF made approximately $3.5 million in awards available to LID credit unions, to support seven key areas of credit union development: 

  1. Training 
  2. Digital Services and Strengthened Cybersecurity
  3. Consumer Financial Protection
  4. MDI Capacity Building
  5. Underserved Outreach 
  6. Impact Through Innovation 
  7. Small Credit Union Partnership 

The maximum amount for an award is determined by the type of funding initiative. 

  1. Training—$5,000
  2. Digital Services and Cybersecurity—$10,000
  3. Consumer Financial Protection—$10,000
  4. MDI Capacity Building—$50,000
  5. Underserved Outreach—$50,000

The Impact Through Innovation and the Small Credit Union Partnership initiatives were awarded as continuation grants, where applicants applied for funding to cover three years of project costs (up to $300,000 for the Impact Through Innovation initiative and $150,000 for the Small Credit Union Partnership Initiative). 

The NCUA also provides for a revolving loan fund to assist LID credit unions’ efforts in supporting their members. A credit union can apply for a loan at any time, which will be repaid in five years. The NCUA Office of Credit Union Development (OCUD) can tailor the specific terms and conditions of the loans to meet LID credit unions where they are. All loans, however, carry a fixed interest rate, which the NCUA board sets annually (source).

Partnerships 

There are a variety of partnerships available to credit unions that can help them gain access to deposits, build capacity, improve their technological capacity, and serve more members. 

Available to all credit unions are partnerships in various state leagues as well as the Credit Union National Association, which is the national trade association for both state- and federally chartered credit unions located in the United States

CNote is a fintech platform committed to serving LID credit unions by providing a source of deposits through a network of corporate impact investors. There is no cost or fee for LID credit unions to participate (beyond the interest paid on deposits). CNote also shares marketing resources to spotlight partner LIDs.

LID credit unions can also consider partnerships with other LID credit unions. Drawing from the experience of these organizations, LID credit unions can pioneer new lending initiatives, products, and services to best serve their members. 

Visibility Benefits 

Many LID credit unions are creating transformational impact for the under-resourced communities that they serve. There is overwhelming evidence that today’s consumers, workers, and investors are interested in that work and in the impact that LID credit unions do on a daily basis. 

  • Seventy-seven percent of consumers are motivated to purchase from companies committed to making the world a better place, while 73 percent of investors state that efforts to improve the environment and society contribute to their investment decisions.”
  • Employees and consumers want to involve themselves with organizations that are benevolent stewards of their communities. More than 75% of employees want to be involved in their organization’s volunteering and philanthropic programs and 91% of millennials would switch brands to one associated with a cause. 
  • 72% of U.S. consumers believe it is more important than ever to buy from companies that reflect their values, and 81% of millennials expect companies to make a public commitment to good corporate citizenship. 

This is great news for LID credit unions. By demonstrating the impactful nature of their work, they can attract not only new members but also new employees and new investors. 

These statistics demonstrate how shareholders are craving opportunities to align themselves with community-minded institutions like LID credit unions.  By demonstrating the impactful nature of their work, LID credit unions can attract not only new members but also new employees and new investors. 

Exception from the Statutory Cap on Member Business Lending 

Another resource available to LID credit unions is exemption from compliance with the aggregate member business loan limit. A member business loan means any commercial loan, line of credit, or letter of credit. 

The aggregate limit on a federally insured credit union’s net member business loan balances “is the lesser of 1.75 times the actual net worth of the credit union, or 1.75 times the minimum net worth” (required under section 1790d(c)(1)(A) of the Federal Credit Union Act). 

LID credit unions are not required to abide by this rule. As a result, they can be more flexible with the lending they do to small businesses, which can be a lifeline to the low- to moderate-income communities that they serve. (Source) 

Conclusion 

The unique resources available to Low-Income Designated (LID) credit unions are invaluable assets in their mission to serve under-resourced communities. From access to capital, eligibility for grants and low-interest loans, to forging impactful partnerships and exemptions from certain lending limitations, these resources empower LID credit unions to make a substantial difference in the lives of their members.

In harnessing these resources, LID credit unions continue to demonstrate the profound impact they can make, not only within the financial landscape but in uplifting the communities they serve, ensuring financial inclusion and fostering sustainable growth for the members they serve. 

Infographic

View and download a copy of the infographic

 

This information should not be relied upon as research, investment or financial advice, or a recommendation regarding any products, strategies, or any security in particular. This material is strictly for illustrative, educational, or informational purposes and is subject to change. Investing involves risks, including possible loss of principal.

By Case Study, CNote

Expanding Access to Capital | UniBank and CNote’s Partnership for Inclusive Growth

CNote is proud to share a new case study with UniBank: Expanding Access to Capital | UniBank and CNote’s Partnership for Inclusive Growth

Before partnering with CNote, UniBank was striving to meet the growing demand for banking services and access to capital among Asian American business owners, many of whom are immigrants.

The management team often wondered whether it would be possible to receive deposits from ESG-minded companies, organizations and individuals outside of its target market. However, without the relationships and proper infrastructure, it did not seem plausible.

CNote’s Impact Cash® emerged as the ideal solution to address UniBank’s challenge of connecting with new sources of deposits. By facilitating partnerships with corporations and impact investors, CNote’s innovative program emphasized long-term community impact and sustainable growth.

“The deposits we’ve received from CNote’s program have increased our capacity to serve the our customers, enabling us to provide more loans and support to small businesses and individuals. We hope that this program will have a greater role in driving sustainable growth and fostering economic development, empowering our customers to succeed in their ventures and build generational wealth.” ~ Simon Bai, EVP and Chief Financial Officer at UniBank

 

 

 

By Borrower Stories, Low Income Designated Credit Union

How Karla Villanueva Grew Her Gymnastics Studio with Her Credit Union’s Support

Karla Villanueva-Bernal has been passionate about gymnastics and practiced the discipline throughout her life. Her dream of opening her own gymnastics studio was finally realized in 2012 when she and her husband started what was then called Karla’s Gymnastics. 

Karla Villanueva-Bernal, Owner of Garden Island Gymnastics

Karla started teaching one class every Saturday in the All Saints Red Barn, a multi-use space in Kapaa, Kaua’i. They had four-panel mats, one bar, a balance beam, and two ledges—just enough to accommodate ten young students. 

During this time, Karla worked full-time at a local financial institution, while her husband, Danny, worked in the travel sector. But Karla’s goal was always to offer higher-level gymnastics for girls and, ultimately, to provide the only USAG program based in the USA Junior Olympics Program on Kaua’i. 

Karla and Danny built and grew their business on word-of-mouth and reputation. 

After three years at the Red Barn, they found a 2400-square-foot warehouse space to rent in Kapaa and later a 4700-square-foot warehouse at the same locations. They rebranded, opening as Garden Island Gymnastics, embracing an incredible opportunity for them to expand and level up their game.

The Garden Island Gymnastics coaches supervise a class

How KFCU Saved Karla and Danny’s Dream

Though they were living their dream, it wasn’t easy. Running a small business in Kaua’i is expensive, and they needed solid financial advice and guidance to make it work. 

When Covid hit, Karla and Danny’s bank shut its doors for 67 days and had no answers for them. The situation could have been dire. Fortunately, the couple had a friend who worked at Kaua’i Federal Credit Union (KFCU), the island’s only Community Development Financial Institution (CDFI).

Whereas Karla’s financial institution could not help, advise, or provide resources for the business, KFCU was ready to step up. The credit union quickly facilitated a PPP loan to keep them afloat during the pandemic, along with two $5000 grants, one no-interest loan, and another through the Cares Act. 

KFCU didn’t know any better what was going to happen over the ensuing months, but they were willing to go above and beyond to get behind Karla and Danny and get them the financial aid they needed to stay in business. They asked, “how can we help?” and then showed up in ways that made all the difference in Karla and Danny’s life. 

“I think as an institution, their philosophy is ‘how can we help?’ where some financial institutions would approach it more like, ‘how can we build our portfolio and maximize profits for our shareholders?’ KFCU is really about helping the community, and it’s not just a marketing tool—that’s their philosophy. And it comes from the top down. Monica, the CEO, she was amazing. Her mindset and leadership are infused throughout the whole organization.”

One of the reasons KFCU was able to help is because they are a CNote Impact Cash® Partner. CNote deploys Impact Cash® dollars to mission-driven and FDIC and NCUA-insured partners, like Kaua’i Federal Credit Union, generating returns on institutional investors’ cash allocations while supporting financially underserved communities across the country. 

Karla and Danny’s experience with KFCU was so positive that they didn’t stop with the PPP loan they had received. They also refinanced their home for the down payment and obtained a commercial loan for the balance, acquiring a 5000-square-foot facility from which they could realize their vision of growing gymnastics on the island. 

Karla outside the new Garden Island Gymnastics location

Building Back Stronger: Envisioning the Future

KFCU had never done commercial loans before. Karla and Danny were their first commercial clients.“I asked the VP, Sean Kaley, ‘Do you do commercial loans?’ and they said, ‘You know what? We are just starting the program and you are going to be our first.’”

The real estate was zoned agricultural-commercial, which played well with Karla and Danny’s ideas. They’d have a world-class gymnastics studio indoors. Outdoors, they’d maintain a small farm operation where they would grow vegetables and food to sell, which would be allocated toward scholarships, travel, and competition fees for the kids they train, many of whom would not otherwise be able to participate.

Now that Karla owns the building they operate in, she and Danny can put money into the property and outfit it to their standards. Karla also wants to do more classes and therapy for kids with special needs, as she feels every child should have a chance to experience and enjoy gymnastics regardless of their financial circumstances. 

From their humble beginnings in the Red Barn with ten students on their roster, they now have over 100 kids and are setting their sights on obtaining college gymnastics scholarships. 

Karla describes their experiences through Covid and beyond as a “George Bailey” moment—that’s the lead character’s name from that old Jimmy Stewart film, It’s a Wonderful Life. At the end of the movie, Bailey realizes what a big impact he’s had on the people in his community and those who lived in it when they rally to his side. The true message of the film is delivered at the end when George reads an inscription in a book that says, “no man is a failure who has friends.” Those words, that sentiment, certainly apply in Karla’s case. 

“These clients had become part of our family, and they did not want us to go under. It was an incredible gesture. I think the point I’m trying to make is that our foundation for success has been the community. They have given us so much. It’s more than just a business transaction. It was the same with our credit union. If it wasn’t for KFCU and their willingness to work through this with us—even when there was no template—our business may not have survived the pandemic.” 

Learn More:

  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
  • Kaua’i Federal Credit Union helps the people of Kaua’i by keeping money on the island for a stronger financial future for our people. They offer their members the financial services and products that are right for them at preferable rates and at little or no cost, ensuring the wellness and wealth of future generations.
  • Garden Island Gymnastics is the only USAG Competitive Kauai Gym
By Borrower Stories, Community Partners, Low Income Designated Credit Union

How Kaua’i Federal Credit Union’s Rent Relief Program Has Stabilized Local Small Businesses—And Local Culture

The COVID-19 pandemic turned Chef John Paul Gordon’s life upside down. One day, John Paul was an executive chef catering to Kaua’i’s tourists, the next day, he was unemployed. After more than 20 years of being a chef, John Paul felt like COVID-19 stole his identity away from him overnight. Despite wanting to get back to work, John Paul says that there was no work to go back to—at least nothing that could provide him with the six-figure income he needed to survive on an island where a loaf of bread costs $7, and where rents are always on the rise.

Chef John Paul Gordon. Photo Credit: Kauai Federal Credit Union

During the COVID-19, Kaua’i’s median home price ballooned from $800,000 to $1.8 million. Although that was fueled in part by COVID-19 refugees from the mainland, it’s part of a larger issue, in which wealthy investors have been gobbling up Kaua’i’s modest housing stock. In 2020, 70% of the homes sold on Kaua’i went to owner-investors purchasing property as non-primary residences. In 2021, that number grew to more than 80%. Therefore, with homeownership out of reach for many locals like John Paul, people have to work two or three jobs, (where they earn some of the lowest wages in the country) to try to make ends meet in a tumultuous rental market that seems primed to evict them. “The rent situation out here is insane, especially with inflation,” John Paul said. “I’ve dealt with this problem here my whole life. I can’t tell you how many times I’ve had to move because the house that I was renting got bought.”

Dana Hazelton, Community Development Officer at Kaua’i Federal Credit Union

Dana Hazelton is similarly familiar with Kaua’i’s rental market. Dana is a Community Development Officer at Kaua’i Federal Credit Union (Kaua’i FCU), the only Community Development Financial Institution-certified (CDFI) credit union on the island. Dana oversees the credit union’s Rent Relief and Housing Stability program, which aims to create housing security for all Kauaʻi residents, regardless of whether they’re members of the credit union or not. As someone who was born and raised on Kaua’i, Dana knows firsthand just how difficult it can be to make ends meet on the island. Dana is a registered nurse, and she spent a decade “working in the trenches” of her community, providing end-of-life care and, later, in-house pediatric care to people experiencing absolute poverty. 

Over the course of a few years, Dana pivoted away from nursing and into education. However, despite finding joy in her work, she knew that if she was going to help people achieve better health and educational outcomes, then she was going to need to help them escape persistent cycles of poverty. Ultimately, that’s how Dana learned about credit unions, and that’s how she got to where she is today at Kaua’i FCU, where, as a CDFI, she and her team have the “flexibility … to radically empower and transform communities around Kaua’i,” and where Dana gets to use capital instead of medicine to heal people.

A Business Model Built Around Community Impact

That was especially true during the COVID-19 pandemic, when Hawai’i was flooded with federal dollars to drive economic impact at the county level. One such initiative was the rent relief program, which saw the state receive $100 million to distribute to nonprofits. The issue, however, was that Hawai’i couldn’t find enough nonprofits to help distribute the funds. The state went to the Hawai’i Credit Union League to ask every credit union in the state to help deploy the rent relief program; however, Kaua’i FCU was the only credit union on Kaua’i to step up and say yes. “We’re not a normal credit union,” Dana said. “Community impact is our business model, so if we see a need, we figure it out.”

The Kaua’i Federal Credit Union Team

Because of the administrative fee associated with deploying these funds, as well as a get-back-to-work grant that allowed Kaua’i FCU to hire new employees, Dana knew that the better she and her team did at running the rent relief program, the more income they could generate to support Kaua’i FCU’s members, expand product offerings, and distribute funds to the community. The win-win-win business model proved to be enough motivation for Dana and her team to succeed, as Kaua’i FCU became the number one provider under the Aloha United Way network in the State of Hawaii. Within two and a half months, the credit union deployed approximately $6 million. 

Unsurprisingly, when the second round of rent relief stabilization funds were announced, the County of Kaua’i again asked Kaua’i FCU to be the provider. “We won this $22 million contract in partnership with the County of Kaua’i, and we were told you probably can’t spend it down and do this,” Dana said. “I was like ‘you don’t know how badly people need this in our community.’ If there’s anything I know working as a nurse for 10 years, I know how to reach people, remove barriers, and meet people where they are.”

To get the word out, Dana and her team connected with trusted community leaders, they printed announcements in local newspapers, and they flooded the airwaves. However, most of Kaua’i FCU’s outreach has been word of mouth, with Dana and her team visiting grocery stores, gas stations, beaches, and small businesses. They’ve even forged a partnership with the public library system, and the CDFI has been intentional about doing community outreach in the Pacific Islander and Filipino communities. Kaua’i FCU strategically set the rental relief cap to $4,500 per month to take into account the rent increases it predicted would follow the island’s eviction moratorium. Additionally, the CDFI made the funds available to as large a swath of the population as possible, including to multifamily and multigenerational households, roommates, non-English speakers, and individuals who didn’t have formal lease agreements.  

By February 2022, Kaua’i FCU’s Rent Relief and Housing Stability program successfully spent down its contract funds. It took Dana and her team less than a year. The milestone meant that Kaua’i FCU was able to unlock another multi-million dollar tranche of remaining rental relief funding, which the CDFI has until 2025 to use. “When your teachers and nurses and doctors and restaurant workers don’t have anywhere to live, that’s an issue,” she said. “We’re in a major housing crisis, and so any capital we get literally changes lives. It stabilizes not only our economy, but our culture, and it prevents homelessness.”

‘The Freedom To Fail’

In the years to come, Dana hopes that Kaua’i FCU can help Kaua’i address its dearth of primary residences, whether that’s through building affordable housing, creating a secondary housing market, starting a first-time homeowners program, and/or developing deed restriction programs that buy back homes in order to keep them in the community to support the local workforce. Regardless of what housing solutions Kaua’i FCU and its partners push for, Dana knows that it’s going to take an unprecedented wave of capital to make it happen. She also knows that with the right partnerships, anything can happen. “I know it sounds impossible,” she said, “but if we could get a pool of $200 million, we could transform our community, build generational wealth, and everybody could win. That’s direct social impact.”

Photo Credit: Kauai Federal Credit Union

Although it’s too early to know how Kaua’i will tackle its housing shortage, for rent relief recipients like chef John Paul, they’re just happy to have made it through the last couple of years under one roof. With the money he was able to save through the rent relief program John Paul was able to take on close to $50,000 in debt to open his own restaurant, Table at Poipu. Within three months of opening, John Paul was debt free, and in his first year, John Paul projects Table at Poipu to make $1.6 million in revenue. Better yet, he’s been able to employ and provide full benefits for nearly 30 employees. In October, John Paul  purchased the restaurant where he used to work: The Bistro at Kilauea. “I now have a secure job,” John Paul said. “I have a secure place to live, and if it wasn’t for this program, me and my 30 employees wouldn’t be doing as well as we’re doing now. I can only imagine the impact that it’s had on the rest of the island.”

John Paul is back to paying $5,000 a month for his two-bedroom, one-bath rental duplex, but he’s thankful that he had 15 months of rent relief. It helped him both to get through the trials and tribulations of the COVID-19 pandemic and to make his dreams of owning his own restaurant come true. “The rent relief program gave me the freedom to fail,” he said, “and I just went for it.

Photo Credit: Kauai Federal Credit Union

Learn More:

  • Kaua’i Federal Credit Union helps the people of Kaua’i by keeping money on the island for a stronger financial future for our people. They offer their members the financial services and products that are right for them at preferable rates and at little or no cost, ensuring the wellness and wealth of future generations.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Community Partners

How Indian Land Capital Company Is Strengthening Tribal Sovereignty, One Loan At A Time

Rjay Brunkow, an enrolled member of the Turtle Mountain Band of Chippewa Indians, has dedicated his career to economic development within Indian Country. Rjay served as an investment banker for Wells Fargo, focusing on government infrastructure, before serving as Solicitor General for the Mille Lacs Band of Ojibwe and chief legal counsel for his own tribe. However, in 2015, after having negotiated two separate casino agreements and dealing with gaming legalese, he had an epiphany. “I came to the realization that I could do a lot more good for a tribe on the finance side than I ever could do as legal counsel,” Rjay said. “I started looking around for an opportunity.”

Rjay Brunkow, CEO of Indian Land Capital Company

As it would turn out, Rjay’s next opportunity presented itself to him thanks to a quick internet search by his now-wife. Indian Land Capital Company (ILCC) was looking for a new CEO. The job description felt like a perfect fit, and Rjay applied; however, he had one concern: despite spending his entire life in Indian Country, he’d never once heard of ILCC or its work. To Rjay, that was an issue. During his interview with the organization’s board of directors, Rjay said that if he was hired, then the board needed to be prepared to spend a lot of money on marketing. Rjay’s honesty struck a nerve with the board, and he was offered the job.

ILCC was created in 2005 by the Indian Land Tenure Foundation (ILTF), a national, community-based nonprofit that serves American Indian nations and people in the recovery and control of their rightful homelands. ILCC is a certified Native Community Development Financial Institution (CDFI) that provides alternative loan options to Native Nations for tribal land acquisition and economic development projects. As a Native-owned and operated business, ILCC understands the unique needs of Native Nations and creates customized, flexible loan packages that suit the specific needs of the tribe and the unique circumstances of the purchase. ILCC also works with the Indian Land Tenure Foundation to provide technical assistance to tribes as they develop and execute land acquisition strategies.

Part of ILCC’s mission is to help Native nations to recover, manage, and gain jurisdiction over 90 million acres of alienated tribal land. That includes assisting Native nations in consolidating undivided interests in land with fractionated ownership, and eliminating what’s called “checkerboarding,” or mixed patterns of land ownership and jurisdictions on Indian reservations. A large portion of ILCC’s loan portfolio is with tribes located in Northern California; however, the CDFI lends nationwide, including in places like Arizona, Idaho, Minnesota, Oklahoma, South Dakota, Washington, and Wisconsin.

Incredibly, in its 18-year existence, ILCC has never had a tribe default on a loan. Despite that perfect repayment percentage, traditional lenders haven’t started deploying more loans to tribes. Instead, according to Rjay, for most of ILCC’s loans, the tribes have been turned down by the traditional banks that they’ve had decades-long relationships with, making the CDFI the only lender willing to work with them. “ILCC came about because of the lack of capital in Indian Country,” Rjay said, “and we were started to help prove to big banks that tribes were good credit and would make their payments. That hasn’t been getting through to banks, but we’re thankful for their ignorance, because ILCC is there to fill those gaps.”

Since Rjay joined ILCC in 2015, the CDFI has consistently deployed three to four loans each year. Most of those loans go to first-time borrowers, and ILCC’s deals range in size from roughly $1 million to $10.5 million, with a typical loan amount being approximately $2.5 million. According to Rjay, all but two loans in ILCC’s portfolio are land acquisition loans. That isn’t to say that the CDFI isn’t open to other economic development-related loans. With the exception of casino loans, ILCC is interested in taking on any loans that have to do with strengthening tribal communities and sovereignty and building tribal infrastructure. However, regardless of the kind of loan that ILCC deploys, they tend to be among the most momentous moments in the history of the tribe.  

(From left to right) Gabriela Campos, Accounting Assistant, Rjay Brunkow, CEO of ILCC, and Cris Stainbrook, President of Indian Land Tenure Foundation.

More Capital, More Impact

According to Rjay, ILCC knows that it can scale its impact, and it would love to deploy more loans in Indian Country; however, the CDFI currently doesn’t have the capital necessary to do that. In fact, Rjay calls capital the CDFI’s only constraint, saying that the minute money comes in, it goes out the door to a tribe in the form of a loan. Therefore, ILCC is constantly looking to raise capital. 

Going forward, however, Rjay has ambitious goals to change the way that the CDFI raises capital, allowing ILCC to access larger amounts of money at better rates. One forthcoming strategy is to approach “big-money tribes” to back up loans to ILCC by guaranteeing the CDFI’s debt. According to Rjay, ILCC has good relationships with many regional banks across the country; however, ILCC can’t qualify for the loan amounts it wants (e.g. $50 million), because the CDFI doesn’t have the resources to put up as collateral. Big-money tribes, on the other hand, do. 

Additionally, ILTF and ILCC are already in conversations with several foundations who are interested in providing similar guarantees. Securing such backing wouldn’t just be a win for ILCC, it would also be a win for these foundations, as they would otherwise have a very difficult time connecting with and gaining the trust of tribes. “We have instant credibility with tribes because we’re Native-owned and Native-run,” said Rjay. “We understand tribes, and we understand how to honor their sovereignty. Another organization is going to have to work 100 times harder to get a tribe’s trust.”

Unsurprisingly, Rjay spends a lot of time on the road, visiting tribes, speaking with potential partners, and attending tribal land dedication ceremonies. For most of his tenure at ILCC, Rjay has actually been the CDFI’s sole employee. Earlier this year, however, ILCC hired its first half-time employee: an in-house loan portfolio manager who does loan administration. It’s an important first step in growing ILCC’s loan portfolio.

Even with the new addition to the ILCC team, Rjay’s job description hasn’t changed: underwrite debt, raise capital, and keep the board of directors happy. “I found a job that pays me to travel around the country and talk to tribal leaders about their hopes and dreams to make their community a better place for their tribal members,” Rjay said. “That’s what I get to do for a living, and it’s the most rewarding thing I’ve ever done in my life.”

Learn More:

  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
  • Indian Land Capital Company is a Native-owned, Certified Native Community Development Financial Institution (CDFI) providing alternative loan options to Native Nations for tribal land acquisition and economic development projects.
By Community Partners, Low Income Designated Credit Union

How Comunidad Latina Federal Credit Union Is Empowering Undocumented Immigrants to Achieve Financial Stability

For many, Azul Sanchez’s story is a familiar one. According to Azul, as the daughter of undocumented immigrants, she was supposed to be another statistic: a Latina who graduates high school and starts working a warehouse job to help her parents. However, that didn’t end up being the case. 

As both a first-generation American and a first-generation college student, Azul enrolled in classes at the same time that she took her first job as a commercial bank teller. It took Azul 16 years to finish college, which she pursued in parallel to her career in the financial sector. Azul transitioned to credit unions and became a branch manager, an assistant vice president, and eventually a director of branch operations. “Being the first generation in this country, I didn’t have any guidance,” she said. “I didn’t know where to start, but I always say that banking turned my life around. I didn’t have a degree, but I had opportunities to keep moving up. I want my team to have the same opportunity I had.”

Azul Sanchez, CEO of Comunidad Latina Federal Credit Union

One of Azul’s mentors is Eric Orellana, the former CEO Comunidad Latina Federal Credit Union. When Eric retired in 2022, Azul applied for the position. Despite not having experience as a CEO, she was drawn to the position because she wanted to be able to give back to her community.

Comunidad Latina Federal Credit Union was started in 2006 with the mission to serve its community “by offering unique, empowering, affordable financial services with compassion, care, and dignity” to individuals who aren’t documented and who don’t have a social security number. Approximately 98% of Comunidad Latina’s members are undocumented; however, not all of the credit union’s members identify as Latino. To qualify for membership, individuals must live, work, worship, or attend school in the city of Santa Ana, or through an immediate family member that is a current member. They must also have a Matrícula Consular de Alta Seguridad, an identification card issued through the Mexican government to nationals residing outside of the country, and an Individual Taxpayer Identification Number (ITIN), which is issued by the IRS to be used on a tax return by those without a Social Security number. Currently, Comunidad Latina has approximately 1,600 members, which is approximately 10% larger than it was in 2022.

Comunidad Latina’s members face a number of challenges, including those that come with being undocumented, DACA recipients, and/or first-generation Americans. Additionally, many of the credit union’s members are either underbanked or unbanked, live paycheck to paycheck, and come from cultures where it’s taboo to discuss finances with others. More than 90% of Comunidad Latina’s members have an annual household income of less than $50,000, and in most cases, its members work two or three jobs to be able to afford their living expenses. “Many of our members don’t trust the banking system,” Azul said. “We have members who literally keep their money under their mattress.”

Team members from Comunidad Latina help a member.

Given those realities, one of the most important things that Comunidad Latina has to do with its members is build trust. The credit union does that by being intentional about whom it hires. For example, each of Comunidad Latina’s five employees, including Azul, understand the challenges of their community because they also belong to the community. Similar to Azul’s own story, two of the credit union’s employees are students. Importantly, Azul tries to instill the belief in all of her team members that if they have a desire to learn and help their community, then one day, they too can become the CEO of a credit union.

Unique Community, Unique Products

Despite Comunidad Latina’s small team and limited resources, the credit union is able to offer high-impact products to its community. One such product is its Share Secured Loans program, which the credit union adopted from, and tailored to, its community’s practices. Tandas are rotating savings and credit associations (ROSCA) popular in many countries around the world, including throughout Latin America. In short, a tanda is a way for people who know each other to collaboratively save and lend money to each other. For example, if 10 friends agree to contribute $100 each month, every member of the tanda will get to collect $1,000 at some point during those 10 months. Depending on which month a member collects their money, tandas act as a short-term, zero-interest loan, a way to plan for a big expense, or an opportunity to save money over time.

Comunidad Latina does something similar to tandas for its Share Secured Loans program: individual members save and lend money to pay-off a loan before they receive it. The reverse loan allows members to not have to worry about coming into the credit union with a deposit to use as collateral for a loan. Additionally, because these loans have an interest rate of 3.5% (compared to between 12% and 20% at big banks), this product also creates opportunities for members to build their credit as they plan for big expenses. “We created these loans, because that’s what our members understand,” Azul said. “Being able to understand our members and to provide guidance while allowing them to preserve their dignity is very important to building trust with them.”

Another way the credit union is able to support its members is by helping them to think beyond their financial wellness to other aspects of their lives. Azul has attended countless resource fairs, where she’s forged relationships with community partners. That has allowed her to build upon Comunidad Latina’s curated database of community resources that range from English courses and citizenship classes, to medical services and college enrollment assistance.

Through those same community partnerships, Comunidad Latina is frequently invited to lead financial literacy classes and workshops to youth and adults in Santa Ana, many of whom have never had a bank account. During their six-week classes, Azul and her team strive to empower participants with skills, knowledge, and awareness about their financial goals and wellness so that they can achieve financial stability. The classes cover topics like credit, savings, and budgeting, but Comunidad Latina also encourages participants to think about how their values align with their financial decisions. 

A large component of these classes involves participant-learning circles, which provide individuals a safe space to ask questions and obtain guidance on how to overcome financial challenges. Each participant is also paired with a mentor, who supports them throughout the entire six weeks. At the end of the class, participants have to present a vision board along with an outline of how they’re going to achieve their goals in order to graduate. 

According to Azul, unlike other financial institutions, the reason why Comunidad Latina leads these financial literacy classes isn’t to boost membership. “We do these classes wanting people to have financial stability and the financial freedom that they need and want,” she said. “If that means they’re going to open a membership at the credit union up the street or at a bank, that’s okay. I just want community members to be equipped with the tools that they need to be able to be successful.” 

Education is Everything

When asked about her vision for Comunidad Latina’s future, Azul shared her three goals for the credit union. First, she wants Comunidad Latina to develop its use of technology so that it can empower community members to take advantage of the digital transformation taking place in the financial services industry. By doing so, the credit union will be able to be more efficient, thus elevating its members’ experiences. Secondly, Azul wants to continue to grow and build trust within Comunidad Latina’s community through new and existing partnerships with other organizations. Lastly, Comunidad Latina’s CEO hopes to be able to one day open another branch somewhere else in Santa Ana so that the credit union can have a second location to serve more members. 

One of Azul’s favorite quotes is from Nelson Mandela, who said: “Education is the most powerful weapon which you can use to change the world.” To Azul, the words capture the work being done by her team at Comunidad Latina. “We’re doing everything we can to educate as many individuals as possible so they can help make this community stronger,” she said. “I ultimately believe with all my heart that that will reflect in a better world. That’s what motivates me. That’s why I work here.”

Comunidad Latina’s Team, (from left to right) Albert, Maria, Azul, Juliana, Diana, Martha.

Learn More:

  • Comunidad Latina Federal Credit Union (CLFCU) is a not-for-profit financial institution serving the community of Santa Ana, California. Their mission is to Serve their community by offering unique, empowering, affordable financial services with compassion, care and dignity.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By CNote, Quick Tips

Unleashing Corporate Power: Credit Unions and Community Deposits

This article was originally posted on CUNA Strategic Services’ Website. 

Seventy percent of credit unions named growing deposits as a high priority in 2023 – almost four times the amount that articulated the same need in 2022. One nontraditional avenue that credit unions should consider is tapping into the strong movement of corporations channeling cash into the communities where they live and work.

Corporate investments in local communities are a sustained movement, with 51% of America’s largest companies actively engaging in community investments. This comes as no surprise given the research findings that revealed that “seventy-seven percent of consumers are motivated to purchase from companies committed to making the world a better place.”

Another study highlighted: “Nearly 90% of executives believe a strong sense of collective purpose within their organization drives employee satisfaction.” Corporations are acutely aware that supporting community initiatives, particularly in under-resourced areas, is crucial for differentiating themselves from competitors, attracting and retaining top talent, and ensuring continued growth.

With the increasing number of corporations seeking to demonstrate their genuine commitment to the community and their stakeholders, credit unions have a significant opportunity to benefit. By actively supporting credit unions, corporations can demonstrate their dedication to fostering economic growth, promoting financial well-being and addressing pressing social issues at the local level.

Apple is a prime example of a corporation that is actively making a difference with its cash. They utilized CNote, a women-led technology platform, to move $25 million in deposits into credit unions across the country as part of its Racial Equity and Justice Initiative – an effort to address systemic racism in America and expand opportunities for communities of color.

Kaua’i Federal Credit Union was one of the beneficiaries of these deposits, which they leveraged to support their local community with rental relief, environmental resilience and economic diversification efforts.

“Deposits from Apple came at a pivotal time for Kaua’i Federal Credit Union,” said Monica Belz, CEO. “We were able to increase our lending capacity within the community and provide support for local businesses and rental relief efforts.”

Apple’s partnership with credit unions demonstrates how corporations can directly support local communities through deposit initiatives. By channeling funds into credit unions, corporations further empower these financial institutions to become catalysts for positive change in the areas they serve.

As credit unions continue to prioritize deposit growth, they should consider the opportunity presented by corporations moving cash into communities. The movement of corporations investing in local initiatives aligns with consumer preferences and corporate objectives. By engaging with corporations, credit unions can leverage these partnerships to increase deposits, support local economic development and showcase their pivotal role as trusted financial institutions committed to their communities.

By Borrower Stories, Community Partners, Low Income Designated Credit Union

How Freedom First Credit Union Is Leveraging Creative, Character-Based Lending To Approve Community Members For Auto Loans 

When Norma Fralin needed a car in 2016, she didn’t know where to go. She’d never felt comfortable navigating dealerships and interacting with used-car salesmen, and because there were uncertainties surrounding her credit, Norma didn’t know what kind of auto loan she’d be able to get. 

Kim English, the Responsible Rides Coordinator at Freedom First Credit Union

That’s when Norma’s daughter, Catina, told her about Freedom First Credit Union’s Responsible Rides® program. Catina had used the program to get a vehicle of her own. Norma set up a time to speak with Kim English, the Responsible Rides® coordinator, and within a week, Norma had a car. “It was awesome to work with Kim,” she said. “She really made me feel comfortable.”

Since 1956, Freedom First Credit Union has been serving communities throughout Southwest and Central Virginia through local investments, lower rates on loans, higher rates on deposits, and innovative banking services that support members working to build their financial independence. Freedom First is also a CNote Impact Cash® Partner. CNote deploys Impact Cash® dollars to mission-driven and FDIC- and NCUA-insured partners like Freedom First, generating returns on institutional investors’ cash allocations while supporting financially underserved communities across the country.

A cornerstone of Freedom First’s work is its award-winning Responsible Rides® auto purchase program, which Kim has coordinated since September of 2015. The program is geared toward low- to moderate-income earners who need their own car but struggle to afford a traditional car loan due to credit challenges. Responsible Rides®, however, doesn’t just hand out car keys. Instead, applicants must meet specific guidelines, including having a valid driver’s license, the ability to have full-coverage auto insurance, and proof of employment that goes back at least 90 days. Applicants also can’t have more than $1,500 in unpaid collections, judgments, or charge-offs. Additionally, in order to qualify for Responsible Rides®, individuals must meet with a financial counselor and complete courses on finances and budgeting, as well as car maintenance and care. 

One thing that Kim regularly sees at Responsible Rides® is people who come in with zero credit. In those situations, Kim is able to look at alternative pay history, such as utility bills, insurance payments, rent payments, or even court funds, as a proxy for credit. Also, when Kim submits a loan application to Freedom First’s underwriters, the applicant gets to write about how having a car will change their life. By being creative and considering someone’s character and personal story alongside the above-mentioned criteria, Kim is able to get more individuals approved for auto loans. Those loans cap out at 18%, which is significantly lower than predatory lenders’ rates. However, once an individual’s credit begins to improve, Freedom First is able to refinance their auto loan to lower their monthly payment. 

Kim estimates that approximately 80% of the individuals she works with through Responsible Rides® are single mothers. Kim also works with a lot of young people who are getting their first jobs, but who don’t have transportation, and she works with older, fixed-income individuals who struggle to get themselves to doctor’s appointments and the grocery store. She recalled one story about a client whom she recently assisted. “We met at the dealership and she got in her car,” Kim said, “and the woman said ‘I don’t have to get on the bus now. I can work different hours at my job. I don’t have to be afraid that I’m gonna get off late and miss the bus.’ There are just so many stories like that within this program.”

Unsurprisingly, Kim finds her work with Responsible Rides® extremely rewarding—but she isn’t the only one who feels that way. Local used-car dealers also enjoy participating in the program. An important aspect of Responsible Rides® is that individuals have the option to pick their own car, including test driving it and getting it checked by a certified mechanic. Therefore, Kim does everything she can—including doing a fair bit of research—to ensure that Responsible Rides®’ clients have positive experiences getting their cars from dealerships. 

Over the years, Kim has curated two lists of dealerships: one is a do-not-use list of predatory and poor-quality dealers, and the other is a list of hand-picked, small, often mom-and-pop dealerships who are willing to roll out the red carpet for Responsible Rides®’ recipients. Local dealers have been willing to add extended warranties, waive processing fees, and cut selling prices by as much as $1,500 to get people in their cars. “The dealers I have are amazing,” said Kim. “They love this program and they want to stay on my list, because they know these people need to get into vehicles, but they also know that if they treat these people right, once their credit gets better, they’re gonna come back and tell their friends. It’s all about relationships.”

Relationships are one way that Kim has been able to originate 523 loans totaling $5.9 million since she began coordinating Responsible Rides eight years ago. Kim works closely with a network of local nonprofit partners, including Total Action for Progress (TAP), New River Community Action, and Solutions That Empower People (STEP, Inc.) to engage community members. Kim also relies on internal referrals from Freedom First’s team of financial counselors, and many people contact her thanks to previous clients’ word-of-mouth.

That was the case for the Fralin family. For them, Freedom First Credit Union’s auto-loan program has become a family affair: word-of-mouth has led four family members spanning three generations to participate in Responsible Rides®. After Catina referred Norma to the program, Norma in turn told her daughter, Tonya, and grandson, Isiah. Isiah connected with Kim last December, when he got his car. Since then, he’s been working with Freedom First financial counselors to build his credit, budget his money better, and save for a future home.

Tonya, too, has benefited from the credit union’s Responsible Rides® program. When she met with Kim in 2019, she needed to build her credit. Kim helped to get her a car, and Tonya opened a Freedom First account and completed her financial counseling coursework. Within five years, Tonya was able to build up her credit so much so that she and her husband were able to purchase their first home in 2022. “Just talking with Kim really helped me out a lot,” Tonya said. “I like the fact that Freedom First keeps in touch with you, not only with your car and your credit; they keep in touch with you to see how things are going as far as your finances and life. It’s not just about a car or getting a loan: it’s about helping you to achieve your goals.” 

Learn More:

  • Freedom First Credit Union is a member-owned, federally insured community financial institution headquartered in Roanoke, VA since its founding in 1956.
  • Responsible Rides® is a Freedom First Credit Union program geared toward low- to moderate-income earners who need their own car but struggle to afford a traditional car loan due to credit challenges.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Borrower Stories

How Jayme Murray is Creating Food Sovereignty for the Cheyenne River Sioux Tribe.

Long before the Cheyenne River Sioux Reservation was established in South Dakota in 1889, the people of the Lakota Nation sustained themselves off of the land, with the buffalo, or American bison, as its primary source of food. Over a century later, tribal ties to the sacred animal still run strong. The Cheyenne River Sioux Tribe and its retail operation, the Cheyenne River Buffalo Company, are creating new opportunities for economic development, expansion, and sustainability for the Native American community.

At the helm of the Cheyenne River Buffalo Company is Jayme Murray, a sixth generation rancher on Cheyenne River, who grew up on a cow-calf ranch in the area before attending South Dakota State University and working at the Bureau of Indian Affairs for almost 20 years. During his tenure with the organization, he held several roles, ranging from managing all the trust lands on the reservation to serving as the Fiduciary Trust Officer for the Office of the Special Trustee for American Indians.

In 2019, The Cheyenne River Sioux Tribe approached Jayme with an offer to take over the management of their buffalo corporation, a business corporation which operates independently of, but is owned by, the tribe. For Jayme it was a perfect opportunity to bring his expertise to an organization near and dear to his heart. 

The Cheyenne River Buffalo Company already owned a herd of 450 bison when Jayme came on, but he was quickly tasked with growing the organization and their profits. The company had a vision of being better able to grow, process, and market their products under their own label on the retail side. But there was more to this vision of growth than just finances; the Cheyenne River is one of the most economically distressed areas in the United States, where unemployment rates run as high as 80%. As a non-gaming tribe, The Cheyenne River Sioux had to seek out other avenues to develop economically. 

“We have had to lean on what we do have,” said Jayme. “We have agriculture, and we have buffalo, and we have beef that’s some of the best in the world. And if we’re going to stimulate economic growth here at home, it needs to be through what we’re able to do better than anyone.” 

In July of 2019, a golden opportunity presented itself which Jayme knew they couldn’t pass up: a local slaughter facility and associated real estate property went on sale on the border town of the reservation. Jayme knew that purchasing it would allow his team to increase the size of the herd and scale production to meet demand from local restaurants and butchers. 

The CDFI Difference 

Jayme and his colleagues faced a significant hurdle to purchase the facility and surrounding land—financing. 

To begin, the Cheyenne River Buffalo Company explored some traditional lenders. Jayme put together a pitch and a business plan, which, according to him, the lending teams did not even look at. “It was an issue of collateral,” Jayme explained. “This was a new venture for us. While we had profit and loss statements and tax returns, we were still essentially trying to borrow based on projections.” 

Jayme reached out to Cris Stainbrook, President of the Indian Land Tenure Foundation, who he had worked with on several occasions. He provided the company’s business proposal and plan, and the Foundation immediately stepped in to help. First, they provided Jayme’s team with an attorney, who had experience working on similar projects. “That was very helpful for us because we were already having to put up quite a bit of capital of our own to make this all happen,” said Jayme. “That provided an opportunity to save a little bit and make sure everything from the due diligence to the purchase agreement documents were done properly.” 

The Foundation also put Jayme in touch with the Indian Land Capital Company (ILCC), a Native-owned CDFI they had created in 2005 to provide alternative loan options to Native Nations for tribal land acquisition and economic development projects. CNote partners with CDFIs like The Indian Land Capital Company across the country through its customized impact investment offerings that allow corporations to invest in a portfolio of CDFI loan funds selected to meet their impact-aligned goals and to improve their performance on thematic ESG measures.

Jayme could instantly tell the difference between the traditional lenders he had attempted to work with in the past and ILCC. “Their approach as a CDFI really made a difference. They looked outside the lines a little more than conventional lenders and were able to work through a few kinks to support the Cheyenne River Buffalo Company.” 

Despite slowdowns due to COVID, the Cheyenne River Buffalo Company was able to close on the property and facility on February 1st of 2021, with $3M in financing from ILCC. As an added bonus, Jayme was able to retain all of the original equipment, inventory, and employees from the slaughter facility. “The facility closed down on Friday and then opened on Monday morning with us as the owners. If you didn’t know that we had bought it, you wouldn’t have even noticed the difference.” 

Local Impact with International Interest 

Despite the incredible effort it took to purchase the new land and facility, there was no time for Jayme and his team to rest. Initially, the Cheyenne River Buffalo Company was a direct to consumer business, whose biggest clients were local Native American restaurants and butchers. With time, however, Jayme had seen skyrocketing demand from domestic organizations as large as the Department of Defense and internationally from companies in the Middle East and Singapore. To keep up with this heightened demand, the company ballooned to owning over 1100 bison and now is getting ready to launch an online sales portal to enable consumers to more easily purchase their products from anywhere. 

Jayme’s motivation still ran deeper than just the growth of the company. COVID had exposed the volatility of food supplies, and what had started as a financial venture for the company had turned into a personal mission of food sovereignty. His goal is not only to become the premier buffalo meat company in the world, but also to put those products on local shelves to be made available for everyone in The Cheyenne River Sioux Tribe. 

“At the end of the day our goal would truly be to make our buffalo and locally sourced beef products available to all of our people. If we could do that, that would be a success. We have visions of being the premier meat company in the world, and we have the story; I mean, this animal is closer to us than to anyone else. I think there’s room for us to continue to grow and continue to be a resource to other tribes. It feels like the potential for growth just keeps reaching further and further.” 

Learn More:

  • The Indian Land Capital Company is a Native-owned, Certified Native Community Development Financial Institution (CDFI) providing alternative loan options to Native Nations for tribal land acquisition and economic development projects.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Community Partners, Low Income Designated Credit Union

Meet NorthPark Community Credit Union, The Country’s First And Only Fully Virtual Credit Union

How does an infant with hearing loss, an ill anesthesiologist, and a Chapter 13 bankruptcy lead to the first fully virtual credit union in the United States? It starts with Carma Parrish and her son, Logan. 

Logan was born with a fifty-percent hearing loss. The School for the Deaf in Indianapolis recommended surgery to help him regain full hearing, and in 2011, Logan received this life-changing surgery. Everything went great—until a $30,000 medical bill showed up.

Carma Parrish, CEO of NorthPark Community Credit Union. Photo Credit: NorthPark Community Credit Union

Despite obtaining approval from the insurance company before the operation, the company billed the Parrish’s, citing the surgery was completed out of network. When Carma pushed back, she learned that the in-network anesthesiologist had called in sick on the day of her son’s surgery. The surgeon called in a favor from an out-of-network anesthesiologist for Logan’s procedure. No matter who she spoke with at the insurance company or the hospital, she received the same answer: “You owe $30,000.”

Carma called her senator, her congresswoman, and even the attorney general’s office where she filed an official complaint. Despite this, the hospital administration sent the sheriff to the Parrishs’ employers to garnish their wages. At the time, Carma was a vice president at a small local credit union—with an equally small paycheck. While the family was financially responsible, the budget was tight. They did not have $30,000, and now without paychecks, the mortgage, utilities and groceries became daunting hurdles.

Carma and her husband saw no option but to file for Chapter 13 bankruptcy to save their home and regain their paychecks. However, to be eligible for bankruptcy, they actually had to take on more debt—a car loan. The couple hid their bankruptcy from family and their employers not just out of shame but because of the fear that she would be fired.

Per Chapter 13 rules, for the next five years, Carma and her husband were not allowed to take out any new debt, could not amass savings, nor could they receive a tax return—a nearly impossible feat to survive. Statistics indicate only 1% of people who file Chapter 13 bankruptcy make it out—the other 99% turn it into a Chapter 7 filing. If this happened to the Parrish’s, they would lose their home. “That we survived shows it wasn’t an issue of fiscal responsibility: we were in the wrong place at the wrong time.”

The All-of-a-Sudden CEO, and the Failing Credit Union

Carma’s right place/right time came in 2015. Her employer was grooming her to take over as CEO of the credit union ten minutes from her house. Carma was tasked with traveling around to credit unions near and far, learning about software, and choosing one to implement for a core conversion update for her institution. 

This endeavor led Carma to NorthPark Community Credit Union, where she was offered the position of vice president of marketing on the spot. Carma took the job.

Photo Credit: NorthPark Community Credit Union

Within two months, the entire senior leadership team was gone, and Carma became NorthPark Community Credit Union’s CEO overnight. Her first meeting was with the credit union’s accountant. The news was bleak: the electricity bill was past due, the power was set to be turned off, there wasn’t enough liquidity to make payroll, and a budget had to be ready for her first board meeting that evening. 

Carma had a decision to make: Find a new job or try to save NorthPark. Ultimately, it wasn’t a difficult choice when she met the staff and learned of the families depending on their employment—Carma stayed. “It was the most bizarre thing and made no professional sense, but I felt led there.”

In 2018, a year after the Parrish’s’ Chapter 13 requirements were finally complete, Carma crashed her car. “I couldn’t get a car loan to save my life,” Carma says, despite having A+ credit and a well-paying job.

Frustrated, Carma turned to Cindy Duke, the CEO at Natco Credit Union, known for offering lending options to people after a bankruptcy. Cindy didn’t disappoint, but there was a catch: “Cindy said ‘I will do this loan for you on one condition: You have to adopt this lending strategy at NorthPark.’”

Challenge accepted. Carma’s personal journey is how NorthPark Community Credit Union came to serve the underserved.

Photo Credit: NorthPark Community Credit Union

Strategically Thinking Outside the Box

NorthPark began serving individuals with what Carma refers to as “colorful credit,” including those who’ve had significant life events—medical emergencies, unexpected layoffs, divorces, loss of loved ones—that have negatively affected their ability to pay and consequently, their lendability. The transformation included partnering with CNote through its Impact Cash® Solution, which channels dollars from socially-minded investors to mission-driven and FDIC- and NCUA-insured CDFI partners, like NorthPark.

“We want to help people get back on their feet again,” Carma says. “We do not give handouts; we give hand-ups. We are not a charity; we are not for profit. If you invest in us and do the work, then we’ll take a chance and invest in you.”

Under Carma’s leadership, NorthPark has taken strategic steps to recreate itself, decreasing its portfolio of 80% participation loans by 30% as they switched to only organic loans while simultaneously doubling its average loan yield from 4% to 8%. Even though a high-yielding loan portfolio means higher charge-off ratios, the net loan yield still comes higher than most credit unions gross loan yield. 

Lending to those often considered unbankable, NorthPark has achieved a net yield of over 6%, including fee income. Compare that to other socially minded credit unions, which have a median yield of 3.75%. 

Photo Credit: NorthPark Community Credit Union

“You can’t just say we need to have a big heart and do this,” Carma says, “because that’s not going to work. If you look at the mathematics of this philosophy, it works. It’s not just good for the heart. It’s good for the balance sheet. It’s good for the income statement. This is what credit unions were built for.”

Passionate for the financial health of the community, Carma believes credit unions have become far too reliant on automated decisioning, which often selects against people with credit scores less than 640. Such practices tend to leave BIPOC borrowers—and people like the Parrish family simply in the wrong place at the wrong time—on the sidelines.

“How can you say you’re serving your community when you rely on auto-approvals?” Carma believes these people will turn to another lender who doesn’t meet their needs or who charges them predatory rates. “Even worse, they’ll go to a payday loan company. This is what we tell them are their options when we depend so heavily on automated decisioning.”

Motivated To Make Change

During the credit union’s makeover, Carma, her team, and her board decided to transition NorthPark Community Credit Union into the country’s first and only fully virtual credit union. Many of her staff stood behind the teller line, waiting to cash checks when Carma needed them to serve their community and perform more income-generating activities. By going virtual, NorthPark could also minimize its operating expenses to improve its owners’ capital for the greatest return.

Carma surveyed her staff to see what they wanted to do at the virtual credit union—she wanted to know what their dream jobs entailed. As NorthPark began educating members to prepare to switch to virtual transactions, Carma provided professional development opportunities for her team members to move up and develop within the virtual credit union, assuring them, “If you invest in NorthPark, we’ll invest in you.”

Photo Credit: NorthPark Community Credit Union

Things began looking up for NorthPark and Carma. The credit union readied itself to go fully virtual, with the first branch closing and the second one to be announced to the Board when COVID hit that same month. Overnight, NorthPark went 100% virtual and closed the remaining two branches. The credit union remains 100% virtual today for both its members and staff. 

Carma tracks NorthPark’s results to ensure the credit union continues to strengthen. The strategy seems to be working. NorthPark has attracted a broader pool of employees and members, and Carma can recruit top performers without the constraints of geography. Over 30% of Carma’s team lives outside Indiana, representing seven states and Puerto Rico. Nearly 30% of her team is dedicated to full-time community initiatives—and that number continues to grow.

“We say that we never sought to be a virtual credit union,” Carma said. “We sought to be a community credit union, and virtual just enabled it.”

As NorthPark continues to succeed, Carma continues to find motivation in her son—a strapping 6’4”, 16-year-old lineman—and in their shared story. In 2013, Indiana’s legislature passed ‘Logan’s Law,’ written to make sure insurance companies and hospitals cannot do to others what they did to the Parrish’s. An advocate for medical transparency and healthcare reform, Carma has testified in front of lawmakers about the interrelatedness of physical and financial wellness. 

Photo Credit: NorthPark Community Credit Union

Today, Carma challenges other credit unions to rethink their models and to train the next generation of CEOs to return to what credit unions were built for. Armed with NorthPark’s success stats, she explains that by taking on slightly more risk, these institutions can do so much more for their communities and their profits.

“It’s always a good reminder to not just accept things for what they are and to meet people where they are,” Carma said. “When we give people hope and opportunity, we make a difference in their lives, and that’s really what motivates me to seek change.”

Learn More:

  • NorthPark Community Credit Union serves Central Indiana and is the one and only fully virtual credit union in the United States.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By CNote, Quick Tips

Balancing Profitability with Purpose

This article, authored by CNote’s, Director of Deposits, Strategy, and Operations, Jessica Jacobson, was originally posted on CUNA’s Website

Collaboration enables expanded commitment to the community

Credit unions have always been dedicated to serving local communities, providing not only responsible, responsive, and reliable financial products and services but also addressing community needs through impactful community service.

However, bringing awareness of this transformative work to the wider community can be a challenge. Credit unions often have limited resources for promotion and outreach, which often leads to their remarkable community work going unnoticed.

Sharing the impact of their community service differentiates credit unions from their competitors and can attract new sources of sticky deposits from corporate impact investors, spark new member growth, and attract new employees.

Education Credit Union (ECU) in Amarillo, Texas, demonstrates the benefits of sharing their impactful work. ECU has been serving the Texas Panhandle since 1935, and offers the local community innovative products and services like “New Teacher Loans” for recently hired educators who have yet to receive their first paycheck.

Because it can take upwards of six weeks to receive that first paycheck, the credit union wanted to provide new teachers with a non-credit score-based product to meet those employees’ financial needs.

Additionally, more than 98% of ECU employees donate a portion of their paychecks to help fund Pocket Change Grants, a program that provides funding for classroom projects. Since launching the program in 2009, ECU has donated more than $758,000 to school districts across the Texas Panhandle.

ECU goes beyond creating these impactful programs; they actively strive to share their impact both within their organization and beyond.

Internally, the credit union keeps employees informed about the positive outcomes of their community efforts. Staff receive regular reports highlighting how the credit union supports community initiatives.

This transparent communication fosters a sense of pride and engagement among the staff, reinforcing their dedication to making a difference in the community.

Externally, ECU has partnered with organizations like CNote to amplify its community impact. By showcasing the innovative work it does to corporate impact investors, the credit union has successfully attracted deposits from industry leader Apple.

This collaboration has empowered ECU to expand its support for the community, solidifying its commitment to making a lasting impact.

In a world looking for good news, embracing the challenge of sharing their work becomes an opportunity for credit unions. Bringing the story of what they do to make a difference in their community helps credit unions stand out among competitors, attract new sources of deposits, drive member growth, and entice new employees eager to join a mission-driven employer.

By sharing more widely what staff already do daily, credit unions can not only achieve recognition for the important work they’re doing, they can attract resources that make an even greater difference.

By Borrower Stories

Meet David Akinniyi, the Baltimore Developer who’s Transforming his Adopted City with Each New Building

Once down on its luck, Baltimore, Maryland is now on a rebound. One entrepreneur helping to make the city a better place to live is David Akinniyi, founder and owner of the Akinniyi Group, a real estate development and leasing company. His goal is to enhance the lives of Baltimore residents by creating luxury communities designed to foster personal growth, wellness, and inclusion. 

David Akinniyi, Founder and Owner of the Akinniyi Group

Akinniyi began the business in 2020, providing apartments where upwardly mobile residents can become the best versions of themselves. “I want the people that live in these communities to have a good space to study, to learn, to be whatever they’re trying to achieve. I want them to have a functional space that allows for that.” 

With that in mind, the units feature balconies and outdoor space, so tenants can enjoy sunlight and exterior access. There’s even space for gardens and plants. Akinniyi also wants the buildings to be inclusive, places where everyone is welcome, regardless of their economic, ethnic, or racial background. In addition, the apartments are affordable, not high-priced units that push residents out of their own neighborhoods. 

Akinniyi started investing in Baltimore real estate in 2018, buying a single-family home to rent in the Pigtown neighborhood. It’s the same place where he’s opening his new five-unit apartment building. He’s purchased several other properties in the same location over the past few years. 

A software coder, Akinniyi grew up in Dallas, the child of Nigerian immigrants. After attending Boston University and earning an MBA, he joined a consulting firm. Akinniyi played football in college and even had a short stint in the NFL with the Minnesota Vikings. Many of his college football teammates came from the Baltimore area and Akinniyi was drawn to the city. He saw the area’s potential, a community where an aspiring entrepreneur might make a difference. Akinniyi has long had an interest in real estate and Baltimore was a place where a new developer like himself could get involved.

“I’ve always been interested in housing. I felt like real estate was a good place to be and that in Baltimore I could purchase something and make something happen here,” Akinniyi said. 

Akinniyi bought a parcel of land where he planned a multi-family apartment building. While he’d purchased prebuilt properties before, constructing a new build was a novel and more challenging experience. He needed zoning approvals, permits and other upfront paperwork that made the process more complicated. On top of that, he started in the middle of the COVID-19 pandemic, when labor and materials were in short supply. 

Akinniyi contacted Baltimore Development Corporation in search of help, and they connected him with Baltimore Community Lending. 

Baltimore Community Lending is a mission-based, certified CDFI (Community Development Financial Institution) whose loans help low-income, low-wealth, and other disadvantaged communities join the mainstream economy. CNote partners with CDFIs such as Baltimore Community Lending in communities throughout the United States, financing small businesses, providing technical assistance, and empowering local entrepreneurs like David Akinniyi. 

The local CDFI greatly sped up the process, helping him with better interest rates than regular lenders, and providing him with the mentorship he needed to make sure there was no overlooked detail. 

“I would work with Baltimore Community Lending as much as I can. I’m protected from a lot of things. Even the way they set up their draw schedules and payments and everything with the builder. It ensures that you’re protected and the building’s going to get built on time and on budget. So, their system is very helpful to anybody that’s new to trying to build anything. They protect you as an entrepreneur, somebody taking a risk,” Akinniyi pointed out. 

Thanks to Baltimore Community Lending’s diligent work and partnership, David completed construction on the building and hopes to welcome tenants this summer. The real estate investor has big plans for his properties and the larger area. However, this multi-family building is just the start. 

Within the next one or two years he’d like to buy a parcel of about an acre and build in phases in a residential community of some 50-75 units. The place will feature amenities including a gym, a business center, and a recreational center. Five years from now, David Akinniyi believes this new community will help transform the neighborhood and the larger city in a much more positive and uplifting way. 

Akinniyi hopes his new apartment building and the larger residential community he’s planning, will provide a home for residents who want a decent place to live and thrive. Unlike unscrupulous out-of-town real estate opportunists hoping to make a quick buck, he’s staying in Baltimore and making his investments part of the solution instead of part of the problem. 

“I just really want people to have a good place to live. It’s not just for money. It’s more to enhance the city. And for other investors out there, if you truly go at it with that approach, that will not only help you, but it will help everyone in the city, so you’ll increase the beauty for everyone. So, I think it’s a better approach than a lot of people that you see just trying to make money and that’s the only mission.” 

Learn More: 

  • Baltimore Community Lending supports the revitalization and strengthening of underserved communities throughout the Baltimore metro area through innovative and flexible financial assistance designed to promote community development.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Borrower Stories

Meet Flywheel Development, The Company Striving To Create Sustainable Communities In Washington D.C.

Jessica Pitts and John Miller founded their company, Flywheel Development, in 2014 to implement sustainability concepts and renewable energy in and around Washington, D.C. With backgrounds in policy, planning, and energy services, it was clear to both Jessica and John that industry leaders have a big impact on progress towards achieving sustainability goals on a regional basis. 

John Miller and Jessica Pitts, founders of Flywheel Development (Photo credit: Flywheel Development)

In the U.S., commercial and residential buildings account for 40% of energy consumed, and 30% of greenhouse gas emissions, making them a prime target for those interested in combating climate change, and in urban environments, such as Washington, D.C., the share of energy usage and GHG emissions produced by buildings can be significantly higher. This creates a meaningful opportunity to transition away from fossil fuels to clean energy, and to reduce greenhouse gas emissions at scale. While policy making efforts that help cities become more sustainable and reduce their energy use often take years to fully implement, companies such as Flywheel Development are at the leading edge of these efforts.  

“Policy follows what’s possible in industry,” Jessica said. “You need industry leaders out there creating change and demonstrating that it’s possible to build buildings and create urban environments that are more sustainable than the status quo.” With this philosophy, Jessica and John focused on solutions to climate change that can be replicated in communities across the country. 

Building Something Sustainable

Flywheel Development’s first project was a set of net-zero Passive House sustainable townhouses in Mount Rainier, Maryland, right across the line from D.C. The project was a resounding success, and the building program included innovations such as the region’s first combined solar-green roof installation. With this momentum, Jessica and John expanded Flywheel Development’s business to include green infrastructure projects. 

In 2017, Jessica and John  started with three solar projects, and that effort quickly grew to completing  approximately 10 commercial solar projects a year. To date, Flywheel Development has built over 49 solar projects in the District of Columbia and nearby Maryland. Many of the projects are part of the D.C. Department of Energy and Environment’s Solar for All program, which aims to bring the benefits of solar energy to 100,000 low- to moderate-income families throughout the District of Columbia. As a long-term partner with the program, Flywheel Development’s solar projects, such as those located in D.C.’s Wards 7 and 8, provide clean energy to those that need it most. And by opting into the program, Solar for All participants – including residents of single-family homes, multi-family buildings and rental units – can expect to see a 50 percent savings on their electricity bills for 15 years. 

“Because we’re able to meet with folks and learn and understand what a community’s needs are, we can create great outcomes, not only for our company, but for our partner communities,” John explained. “We want to partner with communities to share in the benefits of the green economy and leave them meaningfully better than we found them.”

More recently, the company has added stormwater projects — such as rain gardens — to its green infrastructure repertoire. These projects are largely part of a program in the District that aims to detain stormwater in critical watersheds to help restore the area’s rivers and streams. According to John, adding stormwater management infrastructure to Flywheel’s offerings was a natural step in the company’s evolution. That’s because, at its core, Flywheel is focused on reinvesting in urban neighborhoods by taking on responsive projects that are informed by partnerships that co-create value together with communities.

(Photo credit: Flywheel Development)

Working Together

It was through a mutual industry contact  that Jessica met Bill Greenleaf, the solar energy and commercial real estate loan officer at Virginia Community Capital (VCC). VCC was established by a group of bipartisan state legislators in 2006 to attract social investors to create jobs, enhance the quality of life, and promote vibrant communities in historically underserved areas. Interestingly, VCC is structured both as a for-profit bank and as a nonprofit Community Development Financial Institution (CDFI). CNote deploys Impact CashTM dollars in mission-driven and FDIC- and NCUA-insured CDFI partners like VCC, generating returns on institutional investors’ cash allocations while supporting financially underserved communities across the country. 

According to Jessica, once she and Bill got to talking about Flywheel Development’s involvement in the Solar for All program, the two discovered that they had a lot in common. Clean energy is one of VCC’s four lending areas (not to mention one of Bill’s passions), and VCC has done solar lending across Virginia, the District of Columbia, and as far away as New York. “Bill was on board immediately in terms of the work that we’re doing,” said Jessica. “VCC’s mission-driven nature and focus on community investing is evident in how they work with people.”

(Photo credit: Flywheel Development)

In fall 2021, Flywheel Development received its first loan from VCC for a portfolio of Solar for All projects. This financing included both a five-year loan from VCC and a 12-year loan from DC Green Bank. The relationship didn’t end there. Both Flywheel Development and VCC enjoyed working together so much that a year later, the two closed financing on Flywheel’s Solar for All 2022 portfolio of projects – getting them off the ground and onto the grid. Additionally, over the course of the past year, VCC has helped to connect Flywheel Development with other customers that the CDFI works with, helping to establish new relationships in the community. 

For co-founders Jessica and John at Flywheel Development, it’s these kinds of mission-aligned partnerships that keep them pushing toward a more sustainable future. “We can’t do this work alone,” said Jessica. “You can do more when you partner with people, have a larger vision, and put a team together to do it. We understand the importance of those relationships, and so does VCC. We couldn’t do this important work without them.”

Learn More: 

  • Flywheel Development is a leading sustainable development company. They are active in real estate, solar development, and stormwater management infrastructure
  • Virginia Community Capital is a Community Development Financial Institution (CDFI) with a mission to create jobs, energize places, and promote an enhanced quality of life for Virginians.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Borrower Stories

How Riff Raff Brewing Company Remains Down-to-Earth As Its Earth-Powered Beer Takes Off

Like most homebrewers, when Jason Cox began making his own beer in 2005, he daydreamed about one day becoming a professional brewer. Despite aspiring to make the leap from hobby brewer to full-time brewer, Jason wasn’t quite ready. At the time, he operated his own software company, but in his free time, he continued to pour himself into his hoppy side hustle, brewing beer for his friends and fellow homebrewers.

Come April 2012, however, Jason had grown bored with his full-time job, and he and his wife, Shelly, began to talk about their next professional moves — including Jason potentially starting his own brewery. The couple visited one of Jason’s old brewing buddies in Fort Collins, Colorado, who owned and operated his own brewery. Jason and Shelly toured the operation, and their time in Fort Collins left them feeling confident that they had what it took to run their own small business. Two days later, the couple met with some of Jason’s homebrewing friends back in Pagosa Springs, in Southern Colorado, and together, they decided to open a brewery by Memorial Day 2013.

At the time, Jason and Shelly didn’t have a name for their brewery, let alone financing or a location. However, the two were able to bring their “pipe dream” to fruition and to meet their target opening date. Riff Raff Brewing Company opened in Pagosa Springs on Memorial Day 2013 with 45 employees. “That’s the only deadline I’ve ever met in my life,” Jason said, laughing. “Somehow it all came together.”

Riff Raff Brewing Company is housed in a historic 1896 Victorian that Jason and Shelly selected out of a list of 19 potential properties because the building has access to geothermal energy. The couple wanted to place sustainability at the center of their small business, and natural heat-exchange systems like geothermal are a cost-effective way of slashing fossil fuel consumption. In short, Riff Raff Brewing uses subterranean water pumped from Pagosa Springs’ famous hot springs and uses that geothermal energy to heat the water in its brew house, its kitchen, and its snowmelt system. Riff Raff Brewing’s reliance on geothermal energy is why Jason and Shelly were able to trademark the brewery’s tagline: Earth-powered beer. In fact, Riff Raff was the second brewery in the United States to use geothermal energy, and according to Shelly, the brewery’s “beautifully engineered system” has attracted a number of scientists who’ve visited town simply to tour the facilities.

Jason’s quick to admit that it’s no mystery why Riff Raff Brewing has been able to establish itself as a successful business in Pagosa Springs: it’s because of his wife. From the very beginning, Shelly, a self-identifying “gin and tonic and vodka girl,” was willing to lend her retail, marketing, and business acumen to get the operation off the ground. She’s since stepped in as the brewing company’s COO, and she’s played a key role in launching the business, hiring employees, and growing the brewery. “I have no skill,” he said, “but I have a great wife and partner. That’s how this works.”

Working with the ‘Cheers’ of Banks

In addition to being lucky to have a great wife and partner to start Riff Raff Brewing Company, Jason feels equally grateful to have a wonderful partnership with First Southwest Bank. First Southwest Bank is a Community Development Financial Institution-designated (CDFI) bank that has served the San Luis Valley for more than 100 years. First Southwest Bank is a CNote Impact CashTM  Partner. CNote deploys Impact CashTM dollars in mission-driven and FDIC- and NCUA-insured  partners like First Southwest Bank, generating returns on institutional investors’ cash allocations while supporting financially underserved communities across the country. 

When Jason and Shelly were working to open their brewery, there were seven banks in Pagosa Springs, and according to Jason, First Southwest Bank was the only one who was willing to work with them. The couple met with Sherry Waner, who they continue to work with today. “Sherry literally came to our house to help us with Excel spreadsheets and financial statements,” Jason said. “She was willing to form a personal relationship with us, and that just made all of the difference.”

Although Jason and Shelly got private financing to acquire Riff Raff’s building, First Southwest Bank helped the couple to get a loan from the Small Business Administration (SBA) and it provided them with the operational capital needed to open Riff Raff Brewing Company. Over the past 10 years, First Southwest Bank has provided Jason and Shelly with three separate lines of financing, including a deal in 2018 with First Southwest Community Fund, which is targeted at creating new jobs in rural communities. 

Additionally, over the years, First Southwest Bank has provided Shelly and Jason technical assistance that has helped the brewery to grow into a million-dollar small business in less than a decade. “First Southwest Bank has really held our hand over the years,” said Jason. “Whereas many banks wouldn’t even talk to us, First Southwest provides that extra level of service, and it continues to help us in a way that leaves us feeling empowered.”

Hoppy About The Present, Buzzed About The Future

Around the same time that Shelly and Jason purchased Riff Raff’s iconic Victorian, they also bought a river-front commercial property. Although they didn’t know exactly what they wanted to do with the space at the time, the location — not to mention the price — was too good to pass up. Five years into Riff Raff’s existence, and as the brewery was outgrowing its production space, the couple decided to open Riff Raff on the Rio. The front of the building houses a brewery, and in the back of the building is the only restaurant patio in Pagosa Springs that’s directly on the river. Despite their close half-mile proximity to each other, both locations have been booming ever since.

Going forward, Jason and Shelly have considered expanding Riff Raff Brewing into Northern New Mexico and potentially Lubbock, Texas, where the two went to school at Texas Tech; however, in the short term, the couple is more interested in doing what they need to do to transition the brewery into an employee-owned business. Currently, between its two restaurants and its brew house, Riff Raff’s staff ranges from 62 to 85, depending on the season. For example, when Pagosa Springs population swells from roughly 13,000 residents to more than 50,000 during the summer months, Jason and Shelly rely on a larger pool of part-time employees to serve their customers. “I’m not gonna lie,” said Shelly, “I enjoy having our two locations. We’ll pursue opportunities that come to us naturally and that feel like the right fit for Riff Raff, but we’re being smart with our growth.”

“Vision wise,” added Jason, “we’re at a point where things are at a good spot. If we need more capital, First Southwest would definitely be our first choice, but we’re at such a stable point as a business. We’re not here to make a bunch of money, and we’re not here to be the best brewery. We’re here because we want people to come in, and we want everyone to feel welcome.”

Learn More: 

  • Founded in 2013, Riff Raff Brewing Company operates in downtown Pagosa Springs, CO in an 1896 Victorian style house – one of the oldest buildings in Pagosa.  Not only does RRBC brew all six of our yummy Flagship beers and five different seasonal taps that rotate constantly to keep things fresh and inventive, but we also feature eclectic and unique twists on burgers, nachos, and salads, including goat, lamb, and yak burgers
  • First Southwest Bank is a Community Development Financial Institution (CDFI) bank that works to improve Colorado’s social and economic landscape while putting community at the core.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Borrower Stories

Meet DREAM, Where Students Are Family, Families Are Community, And Community Is Front-And-Center 

Harlem RBI was founded in 1991, when a group of volunteers transformed an abandoned, garbage-strewn lot into two baseball diamonds for the youth of East Harlem. Over the years, the organization began to address the greater needs of its community, including low literacy and high school graduation rates, through its summer and afterschool enrichment programs. As graduation rates improved and college acceptance rates increased, the nonprofit decided that it needed to expand its work from out-of-school programming: it decided to launch a charter school.

DREAM Charter School was founded in 2008, and in 2015, the organization cut the ribbon at its founding school location: 1991 Second Avenue. It was the first public school building constructed in East Harlem in nearly 50 years. In 2017, a year after DREAM Charter School graduated its first eighth-grade class, Harlem RBI and DREAM Charter School combined and rebranded themselves under one banner: DREAM. Today, more than 30 years after it was created on that abandoned lot in East Harlem, DREAM is a network of public charter schools and community youth development programs striving to level the playing field for all children and to help them become lifelong learners 

James DiCosmo, the Managing Director of Finance and Administration at DREAM, describes his colleagues as selfless, hardworking, and high-performing, and according to him, the amount that DREAM’s team cares about the organization and its mission is palpable.“One of our maxims is DREAM is family,” James said. “That’s very much a mantra that we live by, because that’s what these young people deserve: to have caring adults in their lives as much as a rigorous academic schedule.” 

A Pandemic, And A Dream Financial Partner

That mantra was put to the test on Friday, March 13, 2020, when, in light of the COVID-19 pandemic, DREAM’s management team had to sit down and make the decision to send everybody home for an undetermined amount of time. At that point, DREAM’s future — and the futures of the students, families, community members, and employees — was anything but certain. 

However, despite the uncertainties, DREAM didn’t give up on its students. Although its schools closed on that Friday, remote classes began the following Monday. In the months that followed, things didn’t become any easier; however, during that time, DREAM distributed 1,200 Chromebooks and internet hotspots to its students. Additionally, the nonprofit established free weekly food distributions, handing out more than 11,000 bags of fresh produce and nonperishable goods to its families. DREAM was also able to offer $250,000 in direct financial aid for families to use for basic needs, such as rent, groceries, and bills. 

Fortunately, DREAM didn’t have to make that lift alone. Instead, the nonprofit had the support of Carver Federal Savings Bank, which is also headquartered in Harlem. Carver has spent more than 73 years providing New Yorkers with access to capital and banking services, with a focus on Minority and Women-owned Business Enterprises (MWBEs). Carver Federal Savings Bank is one of CNote’s Impact Cash partners. CNote invests Impact CashTM dollars in mission-driven and FDIC- and NCUA-insured CDFI partners like Carver Federal Savings Bank, generating returns on institutional investors’ cash allocations while supporting financially underserved communities across the country. 

DREAM has a long banking history with Carver. For example, Carver provided financing for DREAM’s East Harlem Center for Living and Learning project, which included a 450-seat charter school, space to serve 1,800 kids in afterschool and summer programs, 89 units of affordable housing, and a revitalized public park. In April 2020, the bank once again stepped up for the nonprofit in a big way. 

As most banks were struggling with how to navigate the Paycheck Protection Program (PPP), Carver was able to secure $6 million in PPP loans for DREAM, which allowed the organization to keep everyone employed. In the following months, Carver also helped DREAM to make sure that those PPP loans were ultimately forgiven. With that money, DREAM was able to hire and to maintain enough staff to run both online and, come October 2020, in-person classes for its charter schools. DREAM also maintained its extended-day, extended-year model, including its free afterschool and summer programming, while creating a healthy and safe environment for its scholars and families.

As approximately 1.1 million youth in the New York City Department of Public Schools spent an entire year doing remote learning, Carver’s ongoing support allowed DREAM to weather many of the pandemic’s threats to education. “We’re proud of the decision that we made to support our young people and our community,” James said. “It was challenging, but we’re really grateful and fortunate to have been able to work with Carver to make it happen.”

DREAM Team, Big Dreams

Unsurprisingly, given its name, DREAM’s team dreams big. The nonprofit is working to double its $53 million annual budget, which means that it would also like to double the amount of youth it’s able to serve. Currently, across its six charter schools and afterschool and summer programming, DREAM serves more than 2,000 scholars in East Harlem and the South Bronx, with more than 330 full-time staff members, and hundreds of part-time employees. In the next decade, DREAM hopes to serve approximately 4,000 youth in its communities. 

Last month, DREAM took another big step that will help bring its future dreams to fruition. The nonprofit cut the ribbon to its newest state-of-the-art school, located at 20 Bruckner Boulevard in the Mott Haven section of the South Bronx. The 200,000-square-foot school is located on the East River in a 120-year-old ice house formerly owned by the Yankees’ owner who signed Babe Ruth’s contract. World-renowned Ghanaian-British architect Sir David Adjaye designed the transformation from ice house to school, which will serve 1,300 PreK-12 students.

Additionally, DREAM recently signed a lease for a 100,000-square-foot space in the Highbridge section of the South Bronx, which will become the permanent home of DREAM’s charter schools in that neighborhood in the coming years. According to James, expanding DREAM’s charter schools is a direct response to what the nonprofit’s community needs and wants. For example, in East Harlem, DREAM’s waitlist is more than 1,000 students. That means that until DREAM is able to grow its charter schools to meet that demand, the organization will continue to find ways to engage with community members, create deep relationships with families, and provide ongoing services to youth.

Learn More:

  • For over 73 years, Carver Federal Savings Bank’s mission has been to provide New Yorkers with access to capital and competitively priced banking solutions. Carver continues in its mission by providing access to capital and banking services with a focus on Minority and Women-owned Business Enterprises (MWBEs) and consumers across the greater New York City region.
  • DREAM serves more than 2,500 youth annually in East Harlem, the South Bronx, and Newark. Our unique program model uses team-based methods to provide a comprehensive, enriching experience for young people.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Change Makers Series

Change Makers Interview: Mike Schenk

Mike Schenk has more than 35 years of experience in the financial services industry. In 1992, he joined the Credit Union National Association (CUNA), which is the largest and most influential trade association advocating for credit unions in the country. Today, Mike is both CUNA’s Deputy Chief Advocacy Officer for Policy Analysis and CUNA’s Chief Economist. In his concurrent roles, Mike simultaneously supports the organization’s advocacy initiatives and conducts economic research to help support those public relations efforts. Mike’s analyses regularly appear in trade publications like Credit Union Magazine, and he’s a frequent contributor to the financial media.

Outside of CUNA, Mike serves on the board of the Filene Research Institute, an independent, nonprofit consumer and cooperative finance think tank. Additionally, Mike has served on the board of Summit Credit Union—a $5 billion financial cooperative with over 220,000 members—for nearly 20 years. 

We caught up with Mike to talk about his advocacy work, the state of credit unions, and challenges facing the industry, and we got the opportunity to hear about why he’s so passionate about getting credit unions to share their impact stories with as many people as possible.

CNote: Having worked in the industry for more than 30 years, what keeps you excited about credit unions?

Mike Schenk: Obviously, credit unions are the superior model, because in addition to being member-owned, they’re democratically controlled. I spend a lot of time running around the country and talking about the economy and the economic outlook and how we think that’s going to influence credit union operations and interactions with members, but the other half of my job is to come up with numbers and data and analysis to support our advocacy and public relations efforts and activities. That’s what I get excited about. I do see the credit union charter as being the superior alternative for consumers, and the obvious effects are worth talking about. The transformative effect of cooperative finance is really obvious in the marketplace, and we’re now building out a really extensive data set around that idea, which gets me even more excited. 

CNote: How do your concurrent roles at CUNA complement each other?

Mike Schenk: I sometimes feel like going around the country and doing economic presentations takes me off my game, but there is a really strong connection between the two activities. Ever since I arrived here 30 years ago, in my economic updates, I have been talking about the obvious economic disparities in wealth and income that have existed for the past 30 to 50 years and that have been growing over that period of time. For example, the fact that so few people have rainy days funds set aside. Those are things that I talk about in my economic updates, and they have that direct relationship to the advocacy component of what I’m here for. 

People want to hear about the economy and some of them like to argue about where it’s going, but at the end of the day, I think the value in my travel and discussion about the economy is that we have these conversations around financial well being, even though we might not call it that, such as the fact that so many people live paycheck to paycheck. Then, we talk about how, operationally, credit unions can more effectively and efficiently deliver on their promise, despite all the challenges that we wrestle with.

CNote: How has your advocacy work shifted over time?

Mike Schenk: Historically, when I would advocate, it seemed to me like a lot of our messaging and the themes that we would cover would be the need for policymakers to relieve regulatory burdens. We spent a lot of time talking about how that relief would provide us with more opportunities to serve more people, but I think we kind of missed the boat from a messaging perspective, because there really is an obvious theme and obvious data points and behavioral differences between credit union members and non-members that are super helpful. So, part of our strategic shift as an organization has been to make sure that we emphasize this idea that the mission really revolves around delivering on the idea of financial well being on the one hand, but also operationalizing that and using that in everything that we do, including in advocacy, so that policymakers actually have the proof of impact.

CNote: You spend a lot of time meeting with policymakers and advocating for credit unions. What’re some of the changes that you and your colleagues are promoting?

Mike Schenk: We are interacting with policymakers almost on a daily basis. One example of what we talk about is getting legislation drafted to make changes to our imperfect credit union charter so that we can serve more people, because right now, we’re prevented from serving everyone we want to serve. One of the things that we say to policymakers is, ‘if you were to create a depository financial institution like a credit union today, there’s no way you would create an institution that was only able to serve certain people. You would want everybody to be served.’ Field of Membership restrictions are a vestige of times gone by, back from when credit unions were originally created and there was no such thing as a credit bureau. Field of Membership was created so there’d be a greater likelihood that members would know one another, and then when it came time to make a loan decision, you would have some input from the other members that would give you some idea of potential borrowers character and capacity and collateral. Today, that’s all automated and we have a bunch of ways to assess risk, so the reason for Field of Membership doesn’t exist anymore. 

CNote: What else comes up in those conversations with policymakers?

Mike Schenk: Because credit unions are not for profits, we don’t pay federal income taxes. The value of that income tax exemption is about $2 billion a year, so it’s a pretty significant advantage for us. Policymakers, however, want to know that they’re getting some bang for their buck with this $2 billion tax advantage. The answer is absolutely. We frequently say this isn’t just a good investment, it’s the best investment that policymakers make when it comes to investments in the consumer sector. Our pricing data shows that credit unions leverage the value of the tax exemption and deliver even more value in the marketplace. So, we’re not just passing through the $2 billion. In recent years, it’s been somewhere in the neighborhood of $13 to $15 billion that credit unions deliver back in direct financial benefits to members. We just want to make it as obvious as possible to anybody who will listen, not just policymakers, but to consumers who may not know about credit unions, and we’re in the middle of this transformation where we’re quantifying this stuff in a much more mindful way.

CNote: What’s something that you think that credit unions could do better?

Mike Schenk: There’s no question that credit union managers and credit union employees are out there doing great work every day and really transforming lives, and they do it because that’s what they’ve always done. However, what we don’t always do a great job of is communicating that out to a broad audience. Actually, I don’t think we always do a great job of communicating it internally in our credit unions: sharing stories with staff and with boards of directors and that sort of thing. It happens from time to time, but I feel like it would really be impactful to share those stories, measure those impacts, report out on those impacts and do it seven times, seven ways, over and over and over again, and then do it again. We really need to share our impact stories in a more mindful and regular way. 

When I speak to credit union audiences, they know this viscerally. They understand the credit union difference. They live it. But, especially for smaller institutions, people wear many different hats, and it takes time to document and to memorialize these stories. That means it kind of falls to the bottom of the list and sometimes doesn’t get done at all. This is definitely one of the challenges we face, but credit unions are really here to change people’s lives, so, first and foremost, we need to talk about and share these impact stories whenever we can.

CNote: According to the numbers, there are fewer credit unions today than there were 10 years ago. What’s your take on that?

Mike Schenk: That trend is real, but that’s because there have been a lot of mergers. In many respects, it’s a reflection of the regulatory burden placed on credit unions. Many credit unions are quite small. The last time I looked, close to 40% of credit unions were operated by five or fewer full time equivalent employees. It’s very difficult to operate a financial institution of that size when you have to worry about not just a large pile of rules and regulations in the first place, but constant changes to those rules and regulations, and the introduction of new rules and regulations against the backdrop of things like massive cybersecurity threats. Also, when you have a smaller organization, you lack economies of scale, you lack economies of scope, and if you’re competing on price alone, that makes it very, very difficult to stay alive, because the big guys just have more pricing power than you do.

CNote: What are some other reasons that help to explain the uptick in merger activity?

Mike Schenk: A few things come to mind. It’s increasingly difficult to find qualified directors. Being on the board of directors of a financial institution of any size is a pretty big responsibility. One CEO I used to work with liked to say to his board, “you’ve taken on a huge amount of liability for an occasional sleeve of golf balls,” which really gets your attention, because you realize there is a lot of responsibility. If you screw it up, you could be in big trouble. So, having qualified board members is critically important, and ensuring that those board members are diverse and that they represent the people that are able to join the credit union makes it doubly difficult these days. People are busy, and it’s definitely a time commitment.

Something that’s been magnified recently, especially for smaller institutions, is the war for talent. That’s a really big obstacle for many smaller institutions that can’t necessarily compete on price or pay above-market wages. Instead, they have to do more innovative things like trying to convey the value in learning a lot about a financial institution rather than specializing in one job, but all of that comes into play.

CNote: Would you say that staffing is one of the biggest challenges facing credit unions today?

Mike Schenk: Operationally, yes, that is the big challenge today. Everybody’s talking about getting people. It’s the same complaint and the same challenge that many businesses are facing. There are a lot more job openings than there are people looking for work, so attracting and cultivating and maintaining relationships with employees has been a really big challenge. Of course, while the increases in wages have not kept up with inflation, wages are increasing very quickly, so the cost of attracting people is also rising very quickly. Credit unions are one of those sort of frontline organizations where, at least to a certain extent, people are actually required to be physically present so that we can do our job. In the current environment, and even over the last couple of years, that makes it doubly difficult.

CNote: What’s on the horizon at CUNA that has you excited for the future?

Mike Schenk: In January, we purchased the Equifax database, and we intend to use that to actually measure outcomes across this 28-billion-record database. We are at the point where we’re beginning to make interesting observations that make it very, very clear that no matter where you sit on the credit spectrum, doing business with a credit union results in better outcomes. I’ll give you a quick example. For someone with the highest credit score, the price for a $30,000 automobile loan at a credit union versus a $30,000 automobile loan at a bank results in a savings of about $1,500 over the life of the loan for that consumer. That’s for someone with very high credit. People in the lower rungs of the credit ladder save even more. I estimate that if you’re a subprime borrower and you come to a credit union for an automobile loan and you get it, you’re gonna save close to $12,000 over the life of that loan. It’s a big deal. That’s real money for average people. At CUNA, we have some really smart people using Equifax’s database to build that narrative out in a really impactful way, and it’ll be less about how people feel about credit unions and more about actual impact and what happens to people along the way. 

By CNote, Impact Investing

Why Deposits Are Crucial Right Now

There is a frightening issue for many community-minded financial institutions across the country and the under-resourced communities they serve: a lack of deposits at their local banks and credit unions.

Depository institutions like banks and credit unions take in funds—called deposits—from those with money, pool them, and lend them to those who need funds in the form of loans. Communities across the United States rely on deposits at their local bank or credit union to support their small businesses, cover emergency expenses, consolidate their debt, and pay for housing, schooling, car payments, and more. 

During COVID, deposit levels skyrocketed. But that all changed in the second quarter of 2022, where deposits at FDIC-insured banks fell $370 billion; the first quarterly drop in four years. 

A report from Fitch in January of 2023 explained that they would expect to see bank deposits “shrink meaningfully through 2024, as “depositors seek higher-yielding alternatives for non-operating cash”, and “the Fed continues to shrink its balance sheet through quantitative tightening.” 

Fitch expects U.S. banking industry deposits, which stood at $19.4 trillion at Sept. 30, 2022, to decline by $1.6 trillion in 2023 and a further $1.4 trillion in 2024

Photo Credit: Fitch Ratings

So what changed? And what are the implications of fewer available deposits? 

In 1998, in a report from the Federal Reserve Bank of Minneapolis, John Franklin, president of First United Bank, gave a prescient warning. He was concerned that even though a decline in deposits would not lead to a reduced loan supply for most borrowers, “The next crisis in community banking, without a correction in the stock market, will be the lack of funds necessary for community banks to lend to Main Street and to farmers.” 

Additionally, Fitch’s report notes that banks with “stronger core deposit franchises will be less vulnerable to liquidity changes.” However, depository institutions could face liquidity challenges if they are “experiencing elevated loan growth at the same time deposits decline.” 

And that is exactly what is happening to financial institutions like low-to-moderate-income focused banks and credit unions. Deposit levels are dropping as these institutions are stepping up to serve the communities who need it most. 

According to Cornerstone Advisors’ eighth annual “What’s Going On in Banking” report, “Seventy percent of credit unions named growing retail deposits as a high priority in 2023 – nearly four times the 18% that said so in 2022.” 

On the consumer side, take this NYT’s article which explains that while higher-income households built up savings and wealth during the pandemic, lower-income households “are struggling more profoundly with inflation.” 

Assistance groups that provide food, rental assistance, and other forms of aid to in-need communities have seen more requests for help in recent months “as local families fall behind on their bills. The size of the typical request has gone up too, from a few hundred dollars to a few thousand.” 

Individuals and corporations seeking to create an impact have realized that one of the surest ways to do so is to use cash as a tool to support under-resourced communities. 

At CNote, we help corporations move fully-insured cash allocations to depository institutions to support impactful loan activity in under-resourced communities across the country. These deposits have helped individuals like Catherine Dorsey escape vicious predatory lenders and save thousands of dollars over the life of her loan. 

They’ve also helped entrepreneurs like Mellaney Williams survive, and grow, during COVID 

It’s important to remember that deposit levels are predicted to drop even further over the next two years, placing more stress on under-resourced communities and the depository institutions that serve them. As a result, cash allocations to community financial depository institutions are rapidly becoming one of the surest ways to create a transformational impact. 

Learn More: 

By Community Partners, Low Income Designated Credit Union

New Covenant Dominion Credit Union’s Small Staff Has Big Dreams For The Bronx—And Beyond

Since New Covenant Dominion Credit Union came to life in 2007, Rachel Macarthy has worn many different hats. She served as one of the credit union’s founding board members, and in 2019, she stepped in as the organization’s acting CEO. Despite becoming the permanent CEO in 2021, Rachel has done everything from working as a teller to serving as a loan officer for the Bronx-based credit union. However, Rachel wouldn’t have it any other way. She also isn’t the only one who wears more than one hat at New Covenant Dominion Credit Union. 

For the vast majority of its 16-year existence, the credit union has operated with a staff of two and volunteers as available. Last year, the credit union received grant funding enabling it to hire additional staff members—a marketing specialist and member service representative. As a team of four, they work together to provide amazing customer service and outreach to community members.  “Our team is amazing,” Rachel said, “and it’s exciting when you wear these multiple hats, because you’re able to hear the frontline stories of what’s really happening with our membership. There’s more work on the backend, but we can make decisions knowing who we’re serving and what would reach them best.”

New Covenant Dominion Credit Union was founded in March 2007, when the New Covenant Faith and Miracle Arena, Inc. decided to do something to address one of its community’s most daunting challenges: intergenerational cycles of poverty. According to Rachel, who’s been a member of New Covenant Faith for decades, the South Bronx is an underserved, forgotten neighborhood with “bad statistics all around.” To develop economic stability in its community, the church launched a three-pronged approach that included opening schools, developing a community center, and launching a credit union. Initially, the credit union’s members only consisted of the church’s congregation; however, over the years, the credit union has expanded to serve other churches and other community based organizations in the Bronx. 

Soon after Rachel became New Covenant Dominion Credit Union’s CEO, the credit union’s leadership applied to be certified as a Community Development Financial Institution (CDFI). New Covenant Dominion Credit Union received its CDFI designation in December of 2019, adding to its status as a low-income, black-led credit union and as a minority depository institution. According to Rachel, the timing of those credentials proved significant. When the COVID-19 pandemic struck in March 2020, New Covenant Dominion Credit Union was poised to benefit from the unprecedented amount of federal relief dollars flowing through the CDFI Fund and later in 2021, the Emergency Capital Investment Program (ECIP).

New Covenant Dominion Credit Union used COVID-era grant money to do a number of things, including increasing its staff, investing in technology, and making the shift to digital banking. The credit union was also able to pass along some of those relief dollars onto borrowers in the form of a three-month payment relief program. The credit union has also quadrupled its lending volume, and its loan portfolio has grown from primarily personal consumer loans to include more small business loans and vehicle loans. 

The credit union also used grant money to reorganize, rebrand, and reopen in a new 1,500-square foot location that has two member service desks, a financial counseling conference area and an eye-catching facade, which Rachel hopes will attract prospective members who stand to benefit from free financial counseling and the credit union’s other programmatic offerings. “The pandemic was terrible for our country and nation and world,” Rachel said, “but it created opportunities for us as a credit union that we didn’t have access to before. Because we were able to benefit from grant funding, that really changed everything about our credit union, from the ground up.”

Although New Covenant Dominion Credit Union continues to primarily serve members of the church community, Rachel says that at least 80% of new accounts opened in the past four months belong to non-church members. For Rachel and her team, that influx demonstrates that their presence in the community is growing, and in the coming year, it plans to focus on reaching and serving its target demographic: churches, nonprofits, and other community-based organizations in the Bronx, Brooklyn, and Westchester County. In the future, it would like to expand its field of membership even more.

Rachel and her small-but-mighty team at New Covenant Dominion Credit Union anticipate plenty of challenges on the road ahead; however, they have faith that their determination and passion will propel them toward achieving their goals. Part of that determination is rooted in the fact that the credit union came out of the COVID-19 pandemic stronger than it was before. Rachel and her financial leadership skills stepped in and took a struggling credit union through a pandemic and showed tremendous growth on the other side of it. “Without the funding and resources that we got as part of our CDFI certification,” Rachel said, “we probably wouldn’t be here right now. It’s a blessing and an opportunity that we want to pass on to others.”

Learn More:

  • New Covenant Dominion Credit Union (NCD CU) is a member-driven financial institution whose goal is to develop economic stability within the community and its membership. NCD CU was chartered on March 23, 2007 by the National Credit Union Administration because of the diligent efforts of the church leadership of New Covenant Faith and Miracle Arena, Inc.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Case Study, CNote

Leveraging Corporations to Support Community Impact 

CNote is proud to share a new case study with Optus Bank: Leveraging Corporations to Support Community Impact

Since 2017, Optus has seen the notoriety for their work skyrocket with a seven-fold growth. These investments allowed Optus to add staff and update its digital presence — allowing them to scale operations to serve more under-resourced community members.

This new environment left Optus with two main challenges:

  1. The need to increase sustainable deposits
  2. Increasing competition for previously available deposits

By partnering with CNote’s Impact Cash™ program, Optus Bank was able to increase deposit levels and elevate its visibility. 

“Impact Cash was exactly what Optus was looking for,” said Dominik. “Finding a new source of deposits that came from impact-minded corporations at low cost balanced the equity investments we received and allowed us to turn out more investments into the community to create impact.”

By Borrower Stories

Meet Chung H Lee, The Small Business Owner Helping New York Metro’s Graying Residents Age In Place

It was 2014, and Chung was tired of traveling for work. The business consultant’s job required him to travel around the globe, but Chung was tired of sitting in airports and sleeping in hotels. He wanted to work closer to home and be able to spend more time with his kids. Armed with years of professional experience in the finance sector, Chung began to research various industries, opportunities, and trends to plot his next career step. 

Chung H Lee, Managing Member of Alpha Care Supply // Photo credit: Chung H Lee

It didn’t take long for something to catch Chung’s attention: the United States’ population is aging. More so, as demographics continue to shift and America grays, more and more older Americans are wanting to “age in place.” That means that instead of selling their house and buying a condo in Florida or moving into an assisted living facility, most people want to stay closer to friends and family and remain in their home. According to a recent AARP survey, 77% of adults 50 and older want to age in place — a percentage that has been consistent for over 10 years. However, in order to safely and comfortably age in place, people often need to make adjustments to their homes, including modifications like rails, ramps, and walk-in showers.

Chung was intrigued. He liked the idea of working in healthcare and providing a service to people in need, but he wasn’t sure where he could carve out a niche for himself in the market. That’s when Chung met the owners of Alpha Care Supply, a durable medical equipment (DME) company serving the New York metropolitan area. Although Alpha Care Supply’s founders started the business in 1992, they were nearing retirement age and wanted to sell the company. Chung stepped forward as an interested buyer, and over a six-month period, the company’s founders transitioned Alpha Care Supply over to him. 

An Alpha Care Supply project // Photo credit: Chung H Lee

From day one, Chung set out to expand Alpha Care Supply’s operations to offer a full range of products. That meant becoming a Certified Aging-in-Place Specialist (CAPS) through the National Association of Home Builders (NAHB) and providing a full range of Americans with Disabilities Act (ADA) accessibility products. Prior to purchasing the business, the company primarily offered compliant wheelchair ramps and indoor/outdoor stair lifts; however, Chung expanded that list of products to include vertical platform lifts, patient handling lifts, and home elevators. Alpha Care Supply even provides full ADA bathroom and kitchen modifications, as well as broader home renovation projects, to help create safe and independent living environments for customers.

According to Chung, it took about 18 months to get his feet underneath him at Alpha Care Supply. “Obviously, it was something new,” he said. “It’s a big move and a challenge going from a corporate environment to now running a small business. As a small business owner, you’re responsible for everything, and I had a lot of things to learn.”

Two factors contributed to that steep learning curve. First, the company works with residential and commercial customers experiencing (or planning to experience) mobility or accessibility concerns: nurses, doctors, insurance companies, concerned children, obstinate spouses, other small business owners, city employees, lawyers, nonprofits, and third-party workers’ compensation administrators. Given that stunning breadth of customers, it’s no surprise that it took time for Chung to learn the nuances of his diverse customer base. Second, Alpha Care Supply receives payments from its commercial clients (i.e. 15% of its business) on a delayed timeline. It typically takes 30 days after a commercial project is completed (e.g. ramps and wheelchair lifts are installed in places like city parks, building lobbies, and restaurant bathrooms) before Alpha Care Supply gets paid. “In terms of funding your operation as a small business owner, getting paid is your bloodline,” Chung said. “That’s been an ongoing challenge for us.”

Avoiding the Cracks

By October of 2021, however, there was a new — and much more daunting — challenge on the horizon. For the first time, Chung and his team weren’t able to meet their inventory needs because of global supply chain disruptions. Faced with the same supply chain issues, manufacturers began to demand more up-front money from buyers like Chung. Whichever businesses could meet the manufacturers’ demands were then first in line to get the kind of ADA equipment and parts that are central to Alpha Care Supply’s operations. Without the necessary cash, Chung was sent scrambling to try to secure the inventory his small business needed to survive.

Fortunately, that’s when Chung received a call from Pursuit Community Finance, a Community Development Financial Institution (CDFI) that serves minority- and women-owned businesses across New Jersey, New York, and Pennsylvania. CNote partners with CDFIs like Pursuit through its Wisdom Fund and Flagship Fund, which invest in small business owners like Chung in communities around the country. 

Chung had first learned about Pursuit Lending through the Goldman Sachs 10,000 Small Businesses program; however, the​​ call from Pursuit’s Leo Zhang was completely unexpected. With Leo’s help, Chung was able to apply for and receive two loans through the CDFI, including one from the New York Forward Loan Fund, which was set up to help New York small businesses reopen after the COVID-19 outbreak. Together, the two loans ensured that Alpha Care Supply had the inventory it needed to get through 2021. “Pursuit was instrumental in helping us procure and shore up our inventory,” Chung said. “They helped us get funding so quickly, which was refreshing and energizing.”

For Chung, it felt particularly “refreshing and energizing” to work with Pursuit Lending because Alpha Care Supply’s go-to big bank wasn’t agile enough to step up for the small business when it needed it most. According to Chung, between everything Pursuit has been able to offer him — including new lending products and small business coaching — and his perennial frustrations with his bank, he’s now a CDFI believer. “The more opportunities small business owners have to connect with CDFIs, the better,” he said, “because it’s easy to fall through the cracks and not recover. For me, having Pursuit is good for my business because I can bounce ideas off of them and discuss things with them that have nothing to do with lending. They have somebody there to listen and give feedback, and that’s a great help.”

The Alpha Care Supply team // Photo credit: Chung H Lee

Today, Alpha Care Supply has about 20 employees covering installations, repairs, sales, construction, and operations. Considering the company’s service footprint includes approximately 16 million people, that means that Chung’s team is both small and mighty. While he’s pleased with the growth and maturation his business has experienced since he bought it nearly eight years ago, Chung is arguably happier with the work that his employees are doing day in and day out to make a difference in people’s lives. “Unless you’re in their shoes,” Chung said, “it’s hard to fathom what sort of challenges our customers face on a daily basis. My team bends over backwards to get things up and running beautifully and to make a difference, and it leaves people in tears. For me, those are the most exciting days as a small business owner.”

Learn More:

  • Alpha Care Supply is a provider of ADA accessibility equipment based in Nassau County for nearly 25 years serving the NY metro area, including the five boroughs, Westchester, Rockland, Yonkers, Nassau, Suffolk counties, and New Jersey encompassing over 16MM in population. 
  • Pursuit Community Finance, a Community Development Financial Institution (CDFI) that provides businesses with affordable small business loans and resources so that they can reach higher, transform and grow.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Community Partners, Low Income Designated Credit Union

How Opportunities Credit Union Is Setting Up Itself—And Its Community—For Financial Success

From a young age, Kate Laud dreamed about someday being a CEO. At Dartmouth, Kate was an English major who liked numbers, and her father encouraged her to aspire to “run something interesting” one day. Although that advice didn’t narrow down Kate’s list of possible career trajectories, over the years, her ambition to eventually lead an organization helped to guide her through various financial roles, from a portfolio manager at a bank in New York City to a futures and options strategist at a bank in Chicago. Eventually, Kate became the CFO for a New Jersey nonprofit dedicated to developing affordable housing. 

However, in addition to wanting to one day be a CEO, there was something else that Kate always wanted to do: live in Vermont. Not only was Kate drawn to the state’s natural beauty, but she had family in the area, and she had always been smitten by Vermonters’ community-oriented dispositions. When a CFO-related position opened up at the University of Vermont Foundation, Kate jumped at the opportunity. She left New Jersey, settled into life in The Green Mountain State, and dove headfirst into her new nonprofit role.

In 2019, a recruiter approached Kate about a leadership position at Opportunities Credit Union, a CDFI-certified financial institution founded in 1989. Although Kate had already seen the ad for the position in the local newspaper and was interested, she didn’t think that she knew enough about credit unions to be qualified to serve as one’s president. According to Kate, credit unions weren’t on her radar in New Jersey, and it wasn’t until after she’d moved to Vermont that she discovered just how much of a force credit unions were in the state. Kate agreed to meet with the recruiter, and in September of that same year, she became the credit union’s president. When the CEO retired a few months later, Kate assumed her role as well, fulfilling one of Kate’s professional dreams. “I had a lot of technical banking and nonprofit experiences,” she said, “and somehow those came together in the credit union world.”

‘We Don’t Say No, We Say When’

It didn’t take long for Kate to face her first CEO-sized dilemma at Opportunities Credit Union. During her first week as CEO, Kate was invited out to lunch with a colleague at a larger credit union. The agenda was collaboration. The topic of mergers had come up before, and although Kate acknowledged that a merger could be a smart thing to do long term, in the moment, she knew it wasn’t the right time. “I wanted to give running this a shot first,” Kate said, “and I wanted to see how the magic works and where we could make adjustments.”

Kate paired the decision to remain a standalone credit union with a number of internal institutional changes. For example, Kate leaned into her nonprofit background and hired a full-time grant writer. Together, they sought out new grant opportunities that could fund new lines of business lending and programmatic offerings. The credit union also chose to partner with CNote through its Impact CashTM Solution, which channels FDIC-and NCUA insured dollars from socially minded investors to mission-driven partners like Opportunities Credit Union. 

Additionally, soon after taking over as CEO, Kate and her team had the opportunity to sit down and draft the next iteration of Opportunities’ four-year strategic plan. After a lengthy SWOT analysis, it became evident that if the credit union was going to survive, then it was going to have to pursue its mission while remaining conscious of its margin. The subsequent document has served as a roadmap for Kate and her team as they strive both to serve Opportunities Credit Union’s members and to grow the institution’s margins. 

This was especially true during the early waves of the COVID-19 pandemic, when deposits drove up liquidity but falling interest rates meant that financial institutions like Opportunities earned very little interest on that cash. To bolster its margin, the credit union focused on lending areas like small business loans while continuing to help people in its community. The credit union also expanded its robust vehicle and credit-building loan programs. In 2021, Opportunities was able to assist in retaining 422 small business jobs and made 38% of its mortgage loans to New Americans, including to members of the Asian and African immigrant communities who resettled in Vermont.

Not only is the credit union intentional about collaborating with refugee and immigrant organizations to connect with these New Americans, but Opportunities is equally intentional about making sure that its staff reflects that global diversity. For example, Opportunities has a multilingual team that speaks languages from around the world. In fact, the credit union’s loan department head is a former Nepali refugee who’s able to connect with other New Americans on a personal level. “That is one secret to surviving,” said Kate. “People can get a mortgage anywhere, but it’s the relationship that is really hard to come by. I don’t think you can walk into a larger credit union and sit down with someone who mirrors you ethnically anywhere but here. That gives us an edge.” 

In addition to serving New Americans, Opportunities Credit Union also serves community members who are unhoused and underbanked, including individuals who are struggling with mental health, living in homeless shelters, and/or surviving on social security disability payments. According to Kate, the credit union works at the intersection of mental health and money. Although she acknowledges that she and her team aren’t social workers, Kate said that the credit union is able to “help people whose emotional needs touch their financial needs” through free financial counseling that’s aimed at building their credit back. Importantly, this financial coaching is offered to anyone in need, not just credit union members. That includes those who are behind on student loan and credit card payments.

Kate shared one recent story about a twenty-something mother of two who’d purchased a home just before the COVID-19 pandemic. However, when said mother lost her job, she fell behind on her mortgage payments. The big credit union foreclosed on her home, and the woman and her two children moved into the family car. Eventually, she found her way to Opportunities, who agreed to help her get her house back. Kate and her team contacted the other credit union and asked it to hold off on auctioning off the home. It agreed, and during that time, the woman was able to get a job and Opportunities was able to negotiate to get her and her kids back into their home. “Our informal mission statement is ‘we don’t say no, we say when,’” said Kate. “We knew we would find a way to get this woman’s house back because, as credit unions, we don’t compete, we collaborate. It’s a movement: we work together, and we move together.”

Opportunities Abound

When asked about the future of Opportunities Credit Union, Kate is quick to note that she isn’t a fortune teller. Still, she’s doing everything that she can in the present moment to make it easier for the credit union to survive—and thrive—for years to come. For example, Opportunities recently used grant money to invest in software that has helped it to drastically speed up onerous compliance tasks. The credit union has also outsourced much of its accounting, IT, and HR work to third-party entities, including to other credit unions. In this way, as a small credit union, Opportunities has recreated itself to be less dependent on individual employees and more resilient as an institution. 

Additionally, in 2022 alone, Opportunities made 10 staff promotions from within the organization. According to Kate, this has been a win-win for the credit union not only because those employees already know Opportunities’ culture, mission, and systems, but because it’s signaled to entry-level hires and prospective recruits that they can expect to receive the training and support they need to similarly move up the ranks at the credit union. Ironically, a couple of new recruits are coming to Opportunities from recently merged credit unions in the region. “Our membership is very different from larger credit unions, and thankfully we don’t compete with them head-to-head,” Kate said. “But, it can be good for Opportunities when larger credit unions merge. People don’t always have to leave, but when they do, they’re coming to us looking for a different opportunity—no pun intended.”

Learn More:

  • Opportunities Credit Union provides innovative and affordable loan and deposit programs for credit building and repair, business and home ownership, consumer needs, modified vehicles, adaptive equipment and energy improvements along with financial education and counseling solutions that have been tailored for our target market.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By CNote

CNote Has Been Re-certified as a B Corporation™

We’re excited to share that CNote has been re-certified as a B Corporation™, a company that uses the power of business to solve social and environmental problems. 

This certification shows that CNote meets high standards of verified performance, accountability, and transparency across various areas including employee benefits, charitable giving, supply chain practices, and input materials.

CNote was first certified as a B Corporation™ in 2019 with a score of 94 (a score of 80 is required to qualify for B Corp™ Certification and 50.9 is the median score for ordinary businesses). In our most recent re-certification, we achieved a score of 121.1 across our governance, workers, community, environment, and customer segments. This increase can be attributed to our ongoing efforts to better serve under-resourced communities, our employees, and more.

Maintaining our B Corp™ status is important to CNote because it provides a benchmark to continue improving our business. By using the B Impact Assessment tool and meeting the B Corp™ standards, CNote will continue evolving new ideas to serve our stakeholders. 

Additionally, the certification provides CNote with the continued opportunity to collaborate and engage with the over 4,000 B Corporations™. Across continents, countries, and industries, all B Corporations™ are united by a common goal of “transforming the global economy to benefit all people, communities, and the planet.” 

“Being a B Corporation™ is more than just a label,” said CNote’s Director of Impact Evaluation, Tamra Thetford. ‘“It’s a way of doing business that reaffirms our commitment to remaining accountable to all of our stakeholders. We’re proud to be part of this movement, and we’ll continue to be thoughtful and intentional in creating sustainable impact for years to come.”

By Impact Investing

A Bright Future Ahead: Why Impact Investing Matters in 2023

What is Impact Investing?

Before we dive into why impact investing is so important for the coming year and beyond, let’s quickly define what it actually means. Impact investing is an investment strategy that focuses on generating measurable social or environmental impact alongside financial returns. This could mean anything from investing in renewable energy projects to providing loans to small businesses in under-resourced communities. The idea is that you are not only earning a return but also having a positive effect on the world with your investments.

Image by rawpixel.com on Freepik

The Power of Impact Investing During a Volatile Economy

While impact investing has been steadily gaining traction over the past few years, its importance is more evident than ever when times get tough. For example, during 2020 as the COVID-19 pandemic swept across the globe, many businesses were forced to close their doors due to restrictions put in place by governments trying to contain the virus. This led to massive unemployment in many countries. However, thanks to impact investors who provided essential funding for small businesses during this difficult time, some of these companies were able to keep their doors open and provide jobs for those without them—which was especially crucial for low-income households who rely on these jobs for basic necessities like food and shelter.

Toni Hopkins received a loan during COVID-19 which allowed her to open her business, Cool J’s Apparel

The Benefits of Impact Investing Beyond 2023

Although its power has been made abundantly clear during times of economic hardship, impact investing isn’t just about getting through hard times—it’s also about using those challenging moments as opportunities for true transformation. By channeling capital into projects that bring change at both the local and national levels, individuals and corporations have an opportunity to make their investments count toward something greater than themselves—all while still receiving an attractive return on their investment!

2023 marks yet another exciting opportunity for all of us here at CNote—and we can’t wait to share our mission of closing the wealth gap through financial innovation with you all! By empowering under-resourced communities through impactful investments that deliver measurable social or environmental benefits alongside attractive financial returns, CNote remains committed to helping you make sound investment decisions while simultaneously driving meaningful change throughout society and making sure everyone has access to resources they need now and in the future. We hope you join us on our journey towards making a real difference in 2023!

By Borrower Stories, Community Partners

How First Southwest Bank Is Helping Community Banks Become Better Banks

In 2013, Kent Curtis had a question to answer. As the president and CEO of First Southwest Bank, he wanted to know which direction to steer the financial institution, which has served the San Luis Valley for more than 100 years. Colorado has three persistent poverty counties, and First Southwest Bank is located in the middle of them. Therefore, no matter what the future had in store for First Southwest Bank’s six Southern Colorado branches, Kent knew that continuing to provide capital to small businesses that supported rural communities in Colorado and New Mexico needed to remain at the heart of First Southwest Bank’s mission. 

Kent Curtis, President and CEO of First Southwest Bank

That’s when Kent had a conversation with another banker that changed everything. That other banker happened to be Kent’s brother, who introduced Kent to the U.S. Treasury’s Community Development Financial Institution (CDFI) Program. The conversation spurred Kent to do some research, and it didn’t take him long to realize that First Southwest Bank might qualify to become a CDFI Bank. In order to qualify, you must be able to demonstrate that at least 60% of your overall activities are to eligible populations and/or in eligible geographic areas, such as Persistent Poverty Communities. Kent and his team submitted an application, and in 2014, First Southwest Bank officially received its CDFI designation. 

Not long after, First Southwest Bank began to receive money through various programs, including the Treasury’s Bank Enterprise Award and the United States Department of Agriculture (USDA). However, because the USDA can’t allocate some of their program funds to for-profit entities, First Southwest Bank decided to start a 501c3 nonprofit called First Southwest Community Fund in order to be eligible to receive those federal dollars. Although First Southwest Community Fund doesn’t have CDFI status, the nonprofit essentially acts as a CDFI revolving loan fund by providing low-cost business lending to individuals that may not otherwise qualify for loans through conventional banks. Not only can the nonprofit provide small businesses with small loans, but it is also able to serve as a subordinate lender alongside First Southwest Bank, thus providing risk-mitigating gap-financing allaying any concerns raised by the bank’s lenders.

Another strength of this unique structure is that both First Southwest Bank and First Southwest Community Fund have access to different funding streams that enable them to make loans. For example, CNote invests Impact CashTM dollars in mission-driven and FDIC- and NCUA-insured CDFI partners like First Southwest Bank, generating returns on institutional investors’ cash allocations while supporting financially underserved communities across the country. Philanthropists, on the other hand, are attracted to First Southwest Community Fund because of its impressive leveraging ratio. For every dollar that comes into the nonprofit, it generates $5 worth of impact. “When you go out and talk to a philanthropist about a five-to-one leverage ratio,” Kent said, “that’s how we attract investors, because organizations don’t generally experience that kind of leveraging ratio.”

HelloBello is Here to Help

Roughly a year after launching First Southwest Community Fund, it became clear to Kent and his Chief Development Officer, Sherry Waner that there was an opportunity to help its own lenders access the myriad of programs that they now had, and to scale their collaborative approach to financing. That’s how HelloBello Financial, LLC was born, and  Sherry was appointed as the CEO. HelloBello is a technology platform that rural-based lenders can use as a tool to efficiently evaluate and filter through various risk mitigating tools available to help small business owners. This allows them to identify innovative gap funding resources and create lending opportunities to support their communities in ways previously not possible. In other words, HelloBello helps solve access to capital challenges and is a way for community bank lenders to fill in gaps and fund projects that otherwise wouldn’t be possible. HelloBello brings together and amplifies the impact of mission-oriented capital and the leveraging abilities of community bank funding.

Kent and Sherry  beta-tested HelloBello with regional community banks just prior to the COVID-19 pandemic. Part of that initial testing was to demonstrate to other lenders that First Southwest Bank isn’t competing for their customers. Conversely, with HelloBello, the CDFI Bank has been able to prove that it can enhance and offer special funding and resources that these banks in other communities don’t have access to. That was especially true during the Paycheck Protection Program (PPP), where many other banks and credit unions across Colorado collaborated with First Southwest Bank to help their clients access this critical resource. Today, Sherry is preparing to launch a new-and-improved HelloBello in the near future.  “We believe that HelloBello democratizes access to risk mitigated capital and will be transformational for community banking. This is one of our many tools that help other community banks create opportunities for their clients and deepen the impact in their communities,” Sherry said.  

HelloBello has already helped to deploy a significant amount of capital. For example, when Colorado’s State Legislature created a $30 million Colorado Agricultural Future Loan Program with economic recovery money to deploy statewide in rural areas, it ran into a major roadblock: it didn’t have any lenders. That’s when First Southwest Bank stepped in to assist the CO Department of Agriculture. As a CDFI Bank, First Southwest Bank is able to deploy the money through HelloBello, thus making those recovery dollars available to other lenders across Colorado. According to Kent, the  primary reason that First Southwest Bank received the money is because of its CDFI designation and its outreach in underserved communities in Colorado.

Working Together to Keep Residents in Their Homes

That wasn’t the only time that First Southwest Bank’s CDFI designation has attracted potential collaborators. In early 2022, La Plata County approached Kent and his team to see if First Southwest Bank could help keep the residents of Westside Mobile Home Park in their homes. The previous month, residents had been informed that Westside’s owners wanted to sell the mobile home park, and the prospective buyer—a real estate company—had a history of raising rents. According to one resident, Alejandra Chavez, at the time, 58 predominantly Latinx families lived in Westside Mobile Park, and if the park came under new ownership, 38 of those families would have been displaced. 

Because of a state law passed in 2020, Westside Mobile Home Park residents had the first right of refusal, which meant that they could put together an offer to buy their property from the owners. The challenge, however, was that they only had 90 days to come up with more than $5 million. Additionally, if the residents were going to successfully purchase their mobile home park, they were going to have to out-compete the real estate company’s no-contingency cash offer.

Given the narrow window of time and the hefty price tag, another CDFI nonprofit —Elevation Community Land Trust—began working with the residents to form a co-op and to get an offer in front of the mobile home park’s owner. That included getting La Plata County involved, which in turn brought First Southwest Bank to the table. La Plata County allocated $1.5 million to the initiative, a local business association invested $500,000, and the residents set up a GoFundMe, which brought in more than $30,000. Lastly, First Southwest Bank stepped up to finance the remaining $3.5 million. “I don’t know a lot of municipalities that would throw a bunch of money into this kind of thing,” Kent said, “but this mobile home park was so important, especially to the workforce of Durango businesses. The county felt that it was that important, and we had to do something.”

Unfortunately, the mobile home park’s owners rejected the residents’ initial offer. That’s because, according to Kent, First Southwest Bank had to order an appraisal, which became a contingency. Miraculously, within nine days of the rejection, Elevation Community Land Trust was able to bring in Impact Development Fund, another CDFI nonprofit, to structure a new funding stack. The new deal was made up of (1) a series of short-term cash loans to purchase the park and (2) additional loans to pay back those initial cash loans that Elevation could then pay off over time with other sources of financing. In this way, First Southwest Bank anchored the deal, providing the long-term financing to cover the short-term cash loans necessary to purchase the park. With that, the residents of Westside Mobile Home Park were able to make a no-contingency, cash offer on their land.

In the end, the residents’ second offer was accepted by the owners, and the co-op officially took over ownership of their land in late April 2022. It took the creativity, agility, and commitment of three different Colorado-based CDFIs to make it happen; but, according to Kent and his team at First Southwest Bank, the experience has been a win-win for everyone involved. There’s little question, however, that the biggest win belongs to the residents of Westside Mobile Home Park. Their success put an end to the inter-generational legacy of displacement experienced by many in their community. Just ask Alejandra Chavez-Alvarez. “The process started and somewhere along the way we lost our fear,” she was quoted as saying in The Durango Herald. “We felt the support of the community, and somewhere along the way, we became a part of that community. Many of us, for the first time, feel a part of Durango.” 

Learn More:

  • First Southwest Bank is a Community Development Financial Institution (CDFI) bank that works to improve Colorado’s social and economic landscape while putting community at the core. 
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Borrower Stories, Low Income Designated Credit Union

How One Detroit Credit Union is Giving its Members a Second Chance 

Catherine Dorsey had always dreamed of becoming a nurse. In 2016, the Detroit resident took a step closer to fulfilling her dream by beginning medical school in Ohio. And while she worked through the demanding courses, another difficulty materialized: her rapidly accumulating bills. 

In order to pay for her medical school loans, car loans, and other miscellaneous expenses, Catherine was forced to borrow on her credit cards. To make matters even worse, Catherine had taken out those loans from a predatory lender. 

“The first loan that I got actually wasn’t enough for me to do everything I needed to do. So then I had another one just to get enough money to move and get to school. I wasn’t thinking about rates and terms. I was just thinking that I needed money fast. I have to get gas. I have to get food. I have to get to work.” 

The One Detroit Credit Union employees that helped Catherine Dorsey and Sandy Waldrip.

Catherine’s expertise was in people’s wellbeing, not in finance. It wasn’t until the bills started coming in that she noticed something was wrong. On a day off, she sat down and calculated the numbers. She realized quickly that the numbers were high. Very high. One the first loan of $4,000, Catherine would be paying almost $12,000. On the second loan of $3000, she would be paying $10,000: A $22,000 total from a loan of just $7000. 

Fortunately, Catherine had been a One Detroit Credit Union member since 2017. One Detroit Credit Union is a Detroit-based low-income designated credit union that has been serving the local community since 1935. One Detroit is a certified Community Development Financial Institution (CDFI) and Minority-Depository Institution (MDI). CNote partners with credit unions like One Detroit across the country through its Impact Cash™ Solution, empowering individuals like Catherine who are looking to lead healthier financial lives. 

When Catherine walked into the door of One Detroit Credit Union in 2021 looking for help making payments on her predatory loans, she saw a brochure on the teller’s desk for a credit building loan. The teller informed her that the program was a way for individuals to borrow money using their own savings as collateral to help improve credit scores and build credit history. 

Sarneisa Whigham, the Branch Manager at One Detroit Credit Union who assisted Catherine Dorsey and Sandy Waldrip.

Catherine had many questions, all of which the teller answered thoroughly and patiently. Eventually, she recommended that Catherine speak with a branch manager for a full rundown on all the products and services that One Detroit offered that might help her. 

When the branch manager reviewed Catherine’s case, She was shocked. “Has anybody ever talked to you about consolidating your debt?” She asked. No one ever had. So the branch manager explained how One Detroit could potentially help her save thousands of dollars over the life of her loan. It seemed too good to be true. At the end of their meeting Catherine filled out several forms and was told that they would be in touch.

The call came just a few days later, and she had been approved. Catherine went from paying nearly $1000 a month to $320. “I was crying. I couldn’t believe it. I kept asking- are you sure? Are you sure?” 

Prior to the loan consolidation, all Catherine was able to do was work to pay the bills. After One Detroit stepped in, Catherine started saving and making purchases that she had been holding off on for years. 

Sarneisa Whigham, Branch Manager, and Hank Hubbard, President and CEO of One Detroit Credit Union

A Second Chance

One Detroit Credit Union’s field of membership is the entire city of Detroit. In order to be responsive to the needs of all those potential members, the credit union begins with the problems that members most commonly face and then designs the products or services which will alleviate those problems. 

For Sandy Waldrip, a lifelong Detroit resident and healthcare administrator, this philosophy ended up having a profound impact on her life. In 2018, Sandy lost her job due to an organizational restructuring and went from a six-figure salary to pulling unemployment. To make matters even more challenging, her mother got sick, and Sandy had to help take care of her for over a year. Payments fell behind, and Sandy’s credit score took a serious hit. 

When Sandy was able to start looking for another job, she knew that she would need a new and reliable car. Her search was complicated, however, by soaring interest rates on all makes and models due to her lowered credit score. When she finally selected a car, it was the dealer himself who recommended that Sandy go to One Detroit, as he had heard they had a strong refinancing program. 

Initially, Sandy applied for a consolidation loan. She was approved in a matter of days, and One Detroit suggested that she apply to Refi My Ride, their auto loan refinancing program. The program refinances auto loans at half of whatever interest rate the member is currently paying (sometimes over 20%) with the same term. For Sandy, that meant savings of $115 a month or $9000 over the life of her loan. 

And while Sandy is grateful for her new car and the reduced rate she received, she is most appreciative that One Detroit Credit Union took the time to look at her whole story. 

“People don’t understand that life happens. And while you would like to have perfect credit, sometimes things turn around and it just can’t happen. And I understand, some banks or credit unions won’t want to invest in you. But I appreciate the fact that One Detroit looked beyond just my credit score and gave me that second chance.” 

Learn More:

  • One Detroit Credit Union is a Detroit-based low-income designated credit union that has been serving the local community since 1935. One Detroit is a certified Community Development Financial Institution (CDFI) and Minority-Depository Institution (MDI)
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Community Partners

How Chicago Community Loan Fund Is Filling Lending Gaps To Grow Wealth

When Wendell Harris found himself out of a job in 2013, he wasn’t exactly sure where he was going to land within the world of banking and real estate. Fortunately, Robert Rose, one of Wendell’s former bosses, heard that he wasn’t working. At the time, Robert was in a leadership role at Chicago Community Loan Fund, a federally certified community development financial institution (CDFI). Robert called Wendell and told him to report to work in two weeks. Wendell joined Chicago Community Loan Fund as a senior loan and program officer, and six years later, he became the vice president of lending operations.

Wendell Harris and Sheneka Harris, General Manager of Amped Kitchens Chicago

Chicago Community Loan Fund was founded in 1991 by a group of social-investment advocates who wanted to create a nonprofit lender to provide flexible, affordable, and responsible financing and technical assistance for community stabilization and development efforts in Chicago. Additionally, the nonprofit wanted to fill community development credit gaps by launching initiatives that would benefit low- to moderate-income individuals, families, and neighborhoods throughout metropolitan Chicago. Like other CDFIs across the country, Chicago Community Loan Fund prides itself on ensuring that community developers in Chicago have an accessible lender to turn to for harder-to-underwrite projects and enterprises.

Wendell has been firmly behind Chicago Community Loan Fund’s mission from his first day with the CDFI. Wendell’s father, Moses Harris migrated to Chicago in 1956 where he landed a job as a machinist at the former Oscar Meyer meat packaging plant across the street from the Cabrini-Green housing project.  Wendell’s mother, Ruth, followed in 1957 after attending a year of college at Tougaloo College in Mississippi.  She continues to share her experiences on picking cotton in Mississippi.  Wendell’s parents were part of the Great Migration of Black Americans leaving the South for cities in the North and West. His parents married in 1958 and moved to Markham, Illinois in 1965.  Wendell’s parents were parents to the entire community of Markham.  Moses kept the kids occupied with sports while Ruth sang heavenly gospel notes throughout the South Suburbs and Chicago.  Wendell was surrounded by family members (including 3 older brothers), friends, and community members with varying levels of business acumen.  “I still remember Mr. Faulkner.  To see a black man in the 1980’s own a bumper company in Markham and a Chrysler dealership in Harvey, Illinois, meant a lot to us.  Slavery is more than just chains and shackles,” he said. “Economic slavery hit our communities had and we continue to be boxed in to limited opportunities”

Unsurprisingly, Wendell and his colleagues have an unmatched desire to shrink the wealth gap in metro Chicago, with an emphasis on the South and West sides of Chicago by giving people in the community the opportunities they need to be successful. For Wendell, that means underwriting deals — deals that traditional lenders won’t touch — that will ultimately benefit both community members and the CDFI. In the past five years, Wendell has underwritten investments at Chicago Community Loan Fund that leveraged more than $443 million in real estate transactions that strengthen lower-wealth communities. “We want to allow wealth to flow,” he said. “When that wealth flows, it opens up more opportunities, because families have more to do more with. At the end of the day, our role is to help create more wealth in these communities — period.”

It Takes The Whole Village

Chicago Community Loan Fund plays a unique role in community development efforts throughout Chicago. Not only does the CDFI offer complete financing for small projects that other lenders won’t cover, but Chicago Community Loan Fund also steps in to fill credit gaps for larger projects. That was the case with Amped Kitchens Chicago: a $25.3 million deal to turn a 117,000-square-foot vacant warehouse in Chicago’s Northwest Side into an “apartment building for food companies.” While Chicago Community Loan Fund only lent $4 million to the project, Wendell and his colleagues collaborated closely with a local team of nontraditional lenders like Local Initiatives Support Corporation (LISC) Chicago, BlueHub Capital, and Chicago PACE to bring the project to life. 

Amped Kitchens is a Los-Angeles-based “growth kitchen” company that rents out space and offers amenities and support to businesses wanting to grow. Unlike ghost kitchens, Amped Kitchens focuses more on creating space for wholesale production and distribution, including storage space, offices, conference rooms, and loading docks. Still, when Wendell initially learned that Amped Kitchens wanted to establish its third location in Chicago, he was skeptical. The concept wasn’t new to the Windy City — The Hatchery Chicago’s 67,000-square-foot facility, for example, was already one of the largest food incubation spaces in the country at the time. However, the more Wendell learned about the project, the more he understood how Amped Kitchens could serve the needs of chefs and small business owners in an important way, primarily by offering more space to entrepreneurs who’d outgrown their smaller kitchens. Additionally, given all of the factors at play, Wendell knew that this was a project that would be very difficult for a traditional lender to get behind. “This is part of the cycle of allowing entrepreneurs to really be able to stand on their own,” Wendell said. “And it’s taken the whole village. It’s taken the innovation of the folks in the kitchen, it’s taken the CDFIs’ patience to be able to figure out how to fund it, and it’s taken the large institutional investors to make this happen.”

According to Wendell, the Amped Kitchens project experienced its fair share of hurdles, including the COVID-19 pandemic; however, in October 2021, the new facility officially welcomed its first tenants. Amped Kitchens Chicago is divided into 64 commercial kitchens that range in size from 150 square feet to 2,000 square feet, and although it hasn’t reached full capacity yet, inquiries, tours, and new leases continue to trend upward. Amped Kitchens has already become an important partner in allowing local grassroots food businesses like Soul Vegan, Half Day, and Scone House Cafe to mature in Chicago, helping to give entrepreneurs another stepping stone on the path from their home kitchens to owning their own commercial real estate, having a more viable presence in the community, and building wealth. 

That’s precisely the kind of legacy that Wendell wants to leave behind. Although he isn’t preparing to retire anytime soon, Wendell wants to be able to look back at the work he’s doing at Chicago Community Loan Fund, including the Amped Kitchens project, and know that he was part of building wealth for people in his community. “I want a couple of generations down the line to be able to look back and not have to see how close they are to slavery,” Wendell said.  “I’m hoping to be able to help put the families behind these businesses in a better position to be able to pass on more wealth to their children.”

Learn More

  • Chicago Community Loan Fund is a a federally certified community development financial institution (CDFI) that provides low-cost, flexible financing and hands-on technical assistance to community development organizations for affordable housing, economic/commercial development & social service/nonprofit facility initiatives.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Borrower Stories, Community Partners

Meet The Disability Opportunity Fund, The CDFI Behind West Virginia’s First Fully Accessible Hotel

Charlie Hammerman didn’t aspire to start his own CDFI; however, since his daughter was born with special needs in 1990, Charlie has wanted to be a change agent. Specifically, Charlie’s been on a professional mission to get people to think about and acknowledge the world that he, his family, and some 20 percent of the United States experience: a world touched by the life of someone with a disability. 

Although Charlie spent time working as a federal prosecutor and later as an in-house attorney on Wall Street, it wasn’t until his career shifted over to the capital markets arena in 1997 that Charlie began to feel like he was in a position to begin to “gently persuade” CEOs and CFOs to look at disabilities as another market for their companies. This included pushing for more representation in companies’ marketing campaigns and more targeted marketing at special needs’ communities. For example, Charlie helped Research in Motion, which was later rebranded to BlackBerry, to realize that its technology would be perfect for the hard-of-hearing and deaf communities, as it provided a means for instant communication. Within six months, the company abandoned its B2B stance and placed an advertisement in a disability magazine. It was Charlie’s first taste of being able to have an effect on mainstream America.

In the early 2000s, those experiences motivated Charlie to want to create a social impact fund on disabilities; however, those three words fell foreign on the ears of his bosses. Despite people’s lack of familiarity with social impact funds, Charlie persisted, and one conversation led to another. Finally, he connected with a colleague who told him about Community Development Financial Institutions (CDFIs). According to Charlie, learning about CDFIs for the first time didn’t so much illuminate what he wanted to do, it shined a light on how he could do it.

In 2005, Charlie left Merrill Lynch to found Syracuse University’s Burton Blatt Institute, an organization to advance civic, economic, and social participation of persons with disabilities in a global society. Two years later, Charlie became the university’s director of CDFI initiatives. At the same time, he received a grant from the Citigroup Foundation to hire a consultant to do a market study to determine what a disability-oriented CDFI might look like. 

Once it became clear that (1) there was an available market niche and (2) other CDFIs were excited to welcome a disability-focused peer to the table, Charlie and his wife, Nanci, launched The Disability Opportunity Fund (DOF) in 2008 to provide financing, technical services, and policy advocacy to increase access to appropriate and affordable housing and related services for people with disabilities throughout the United States. “This is an organization that came out of a lot of professional and personal experience,” Charlie said. “We created it to fill a void, and it’s really just grown from there.”

And grown it has. According to Charlie, DOF’s first few years were difficult, especially when it came to fundraising; however, the CDFI has been able to grow its total assets from $390,000 in 2008 to $71.4 million in June 2022. Despite not knowing much about the CDFI industry prior to launching their own CDFI, over the past 16 years, Charlie and Nanci have found ways to expand DOF’s portfolio, work, and team in a way that’s demonstrative of the creativity and community-mindedness that’s often associated with the industry.

‘Something That’s Never Been Done Before’

Since its inception, DOF has been on a mission to reach as many low-income people with disabilities as possible through its lending activities and technical assistance. However, while creating affordable housing units, employment opportunities, and specialized educational programs might seem typical of CDFIs, DOF has established a reputation for itself as being anything but ordinary.  

For example, in 2018, DOF got a call that eventually brought Charlie and Nanci to West Virginia for a long weekend. While the scope of the visit was to learn about the needs of the autistic community there, Charlie and Nanci also got a crash course in opioid-use disorder. That eye-opening experience was punctuated by a stop in White Sulphur Springs, where a 2016 flood had essentially wiped out the town. Charlie and Nanci lived through Superstorm Sandy; however, proportionately, White Sulphur Springs’ flood was much worse. In the town of 2,500 people, 14 died in the flash flood, and of the 1,400 single-family homes in the area, 200 were wiped away in a matter of hours. Two years later, the small town’s commercial core continued to mostly sit empty, filled with mold. 

DOF saw an opportunity to get involved. At the end of 2018, the CDFI won a federal economic redevelopment grant through the CDFI Fund. When DOF received the money in early 2019, Charlie and his team didn’t have to think hard about where they wanted to focus their efforts. They returned to White Sulphur Springs, met with a delegation that included elected officials, town elders, and local merchants, and, ultimately, purchased a city block. Over the next three years, DOF gut-renovated the buildings, including 16 apartments, and the CDFI invested in enhancements to make sure that the town center would be prepared for the next 1,000-year flood. When the work was completed, the CDFI rented out the residential units at 50% market value and the commercial spaces at $5 a square foot.

DOF’s efforts in White Sulphur Springs attracted the attention of a local family, who began redeveloping and revitalizing the other side of the street. With the town’s two-block thoroughfare revived, Charlie and his team turned their focus to the lot around the corner, where a 50,000-square-foot former high school that graduated its last class in 1993 sat vacant. After consulting with the local community and doing a needs assessment, DOF paid $1 to have the 110-year-old high school transferred to the CDFI so that DOF could redevelop it into what the community said it needed most: a hotel. 

However, Charlie and his team didn’t just want to redevelop the building into any ordinary hotel: DOF wanted to create the world’s first fully accessible hotel. “I said if we’re going to do something like this, then we’re going to do something that’s never been done before,” said Charlie. “Let’s make every room accessible and think about every form of disability so that when you walk inside, you don’t have to worry about anything.”

Importantly, despite being the first fully accessible property of its kind, in which the 30 rooms and all public spaces exceed Americans with Disability Act (ADA) standards, DOF didn’t name it The Disability Hotel. Instead, the CDFI cemented the building’s place in White Sulphur Springs’ storied history and called it The Schoolhouse Hotel. Additionally, the CDFI used the hotel to create even more economic opportunity for the local community by incorporating a restaurant and a rooftop bar. Besides catering to tourists, road-weary motorists, and hungry locals, The Schoolhouse Hotel also serves as a space for weddings, conferences, and family-oriented educational events. Today, The Schoolhouse Hotel employs roughly 40 locals, a number of whom either graduated from the high school more than three decades ago or whose parents did. The hotel also participates in various programs to train and hire people with autism, which connects back to what initially brought Charlie and Nanci to West Virginia.

Like all of the loans it has funded in its 16-year history, DOF plans to make sure that The Schoolhouse Hotel will continue to benefit White Sulphur Springs’ community members. As such, even though the CDFI currently owns the building, that won’t always be the case. According to Charlie, he would one day like to turn the hotel back over to the community in some capacity. “This isn’t open-ended,” Charlie said. “As a CDFI, we don’t do 30-year mortgages and we don’t do 15-year mortgages. We do five-year pieces of paper, because the whole idea is to use our money and then to get rid of us so that you can learn how to run that project on your own. Same thing here: the whole idea is to get this back into the local community.”

Netflix, and The Next Generation of Change Agents

In order to make The Schoolhouse Hotel a reality, DOF relied on a combination of grant money and an overall increase in net assets; however, unbeknownst to Charlie and his team at DOF, while they were revitalizing downtown White Sulphur Springs, Netflix was designing a custom note with CNote. In 2021, CNote debuted its customized impact investment offerings to allow enterprises like Netflix to invest in a portfolio of CDFI loan funds selected to meet their impact-aligned goals and to improve their performance on thematic ESG measures. Once its custom note was created, Netflix invested capital in it to support loans for businesses that, among other things, offer direct services and products for disabled populations or that employ disabled populations. Ultimately, one of the CDFIs included in Netflix’s custom note portfolio was DOF, and with Netflix’s investment, DOF was able to complete its work on The Schoolhouse Hotel.

For Charlie, the experience was more than enough to get him excited about what other opportunities might exist when CDFIs like DOF and impact-seeking enterprises like Netflix are able to connect through CNote’s custom notes. “That’s the key point of CDFIs doing the work versus a private equity firm doing the work. In looking at community revitalization, PE firms’ first priority is the financial return of a project. CDFIs are asking, ‘what’s going to make sense for this community?’ We can’t give you a 22% return on your investment like PEs, but we are going to give you a 100% return on impact.”

Going forward, Charlie expects DOF to continue its work toward ensuring that people with disabilities have access to good education, good housing, and good jobs; however, while the CDFI is committed to creative lending and specialized technical assistance, it’s equally committed to recruiting the next generation of changemakers to perpetuate the CDFI’s mission. 

Although Charlie jokes that he’d love to go out of business one day, the reality is that no one is going to work harder to support the disabled community through economic redevelopment than DOF, and until the Marriotts, Hyatts, and Hiltons of the world catch on, DOF will continue to use its platform as a CDFI to lead by example and to prove that accessibility is good for business. “Our work will never be done,” he said, “and that’s exciting. Every single day, our job is to provide the technical assistance to try to either change somebody’s life or to change policy. From day one, our job has been to be a change agent. That’s what we’re doing now, and that’s what we’ll continue to do.” 

Learn More:

  • The Disability Opportunity Fund (DOF) is a community development financial institution (CDFI), launched in April 2007, located in Rockville Centre, New York and operating nationally. They are a 501c(3) tax-exempt organization which provides financing, technical services, and policy advocacy to increase access to appropriate and affordable housing and related services for people with disabilities throughout the United States.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.

 

 

By Community Partners

How VCC Bank Is Using Mission-Driven Lending To Strengthen The Commonwealth

When Virginia Community Capital was established by a group of bipartisan state legislators in 2006, the goal was to create a business model that would attract social investors near and far to create jobs, enhance the quality of life, and promote vibrant communities in historically underserved areas across the state. Part of that business model meant structuring the organization to be both a nonprofit Community Development Financial Institution (CDFI) loan fund and a for-profit CDFI bank, VCC Bank. Like other CDFIs, Virginia Community Capital and VCC Bank provide credit and financial services to people, businesses, and communities not served by traditional lenders. 

Photo credit: Virginia Community Capital / Photographer: Nick Davis Photography

VCC Bank, however, goes even further to challenge the narrative of what it means to be a traditional lender. Not only was VCC Bank one of the first regulated banks in the country to be designated as a Benefit Corporation (B Corp), but the bank is owned by a nonprofit (VCC Social Enterprises, a new holding company formed in 2021). That means that in addition to adhering to standards set forth by B Lab Global, VCC Bank’s shareholders are interested in more than quarterly dividends: they’re interested in tracking the impact created from their dollars. Fortunately, that impact is measurable. At its founding, Virginia Community Capital was seeded with a $15 million loan. Since then, the organization has turned that original investment into nearly $2 billion in statewide impact.

Over the years, VCC Bank has created the reputation for itself as being the “first in” on high-impact community projects that other lenders won’t touch. In general, those projects fall into one of four lending areas: small business, real estate, clean energy, and healthy food. Since its inception, VCC-financed projects have created over 11,000 affordable housing units, supported 30 food-access projects, backed 26 health-related initiatives, and generated or retained nearly 14,000 jobs. Additionally, VCC Bank staff provide thousands of hours of free advising to community members, including Black, Indigenous, or People of Color (BIPOC) and women small business owners. “A lot of these business owners feel that their needs aren’t being met or that the standards elsewhere are such that they don’t qualify for lending,” said Joey Barnes, VCC Bank’s small business lending manager. “Here, we get the opportunity to educate business owners so that they can then work with their bookkeepers to make sure that when they come back to the bank, their loan package is properly prepared.”

Photo credit: Virginia Community Capital / Photographer: Nick Davis Photography

Another way VCC Bank is supporting BIPOC and women small business owners is through its Economic Equity Fund: a $10 million loan fund that provides low-cost financing and technical assistance to entrepreneurs who were disproportionately affected by the COVID-19 pandemic and who weren’t able to take advantage of PPP funds. According to Joey, the fund has enjoyed a tremendous amount of success in just a short period of time. Since April 2021, VCC Bank has provided about a dozen small business loans totaling approximately $3.3 million. Thanks to a grant, VCC Bank will be able to extend those fund benefits into the future, including free consulting to qualifying small businesses throughout the state.

‘Opportunities Find Us’

When Bill Greenleaf joined VCC Bank as its senior vice president of real estate lending seven years ago, he was thrilled to have the opportunity to combine his background working in real estate finance with his interest in solar energy to help create VCC Bank’s clean energy loan program. Similar to its other lending programs, VCC Bank steps in to make clean energy loans — primarily relating to solar energy projects — when other banks aren’t willing to get involved, either because a given project is too small or because banks don’t want to invest the requisite time to “figure out how to do it,” says Bill. According to him, even though these projects tend to be small, they have high mission impact, as they often provide free solar energy to low- and moderate-income households. 

Bill Greenleaf, SVP of Real Estate Lending and Joey Barnes, SVP, Small Business Lending Manager. Photo credit: Virginia Community Capital / Photographer: Nick Davis Photography

Given its roots in Virginia, it’s not surprising that VCC Bank has done solar lending across the commonwealth, as well as in the District of Columbia; however, the organization has also done loans in places like New Jersey, New York, North Carolina, and Tennessee. Interestingly, VCC Bank’s expansion into neighboring states isn’t a result of proactive marketing efforts. Instead, Bill says that VCC Bank is able to make those loans for two reasons. First, traditional lenders’ avoidance of clean energy lending isn’t unique to Virginia. Second, VCC Bank enjoys a robust referral network that extends beyond Virginia’s borders. “We’ve developed some expertise, and we’re willing to lend out of state and to look at larger deals,” Bill said. “People hear about us, and because we’re willing to work on oddball deals, opportunities tend to find us.”

“Oddball deals” finding VCC Bank isn’t unique to its solar energy lending program. Whether it’s on the affordable housing side, the small business side, or the healthy food side, the bank’s lending team enjoys a remarkable number of incoming leads. Obviously, not all of those inquiries turn into deals; but, just last week, VCC Bank approved a loan to a nonprofit so that the nonprofit can continue its work supporting approximately 80 disadvantaged farmers and grain processors in Virginia while it waits for grant reimbursements from The United States Department of Agriculture. Over the next year, as the grant money comes in, the nonprofit will pay down its loan with VCC Bank. “We’re providing some of the upfront capital to help those farmers,” said Joey. “That’s just one example of how we’ve shifted to trying to serve producers, aggregators, and processors instead of retailers with our food access financing.”

Photo credit: Virginia Community Capital / Photographer: Nick Davis Photography

Going forward, VCC Bank plans to improve and expand upon its four lending programs while paying attention to evolving community needs. Although it’s too soon to know how the market will shape its future operations, one thing remains certain: whether it’s creating affordable housing, working with small business owners, funding clean energy projects, or investing in local farmers, VCC Bank will continue to meet the needs of the community when other banks won’t. According to Bill, continuing to forge strong partnerships will be key to the social impact lender’s future success. For example, in 2020, VCC Bank became one of CNote’s Impact Cash™ partners, which allowed it to greatly reduce its reliance on the kind of higher cost  deposits it previously needed to meet its increasing loan demand. However, thanks to its partnership with CNote, VCC Bank hasn’t had to book any wholesale funds in the last 12months. “We’re always trying to streamline the loan capital we provide,” said Teresa Martin, VCC Bank’s Director of Deposits, “and CNote’s Impact Cash™ solution is really allowing us to be more impactful with our dollars.” 

Photo credit: Virginia Community Capital / Photographer: Nick Davis Photography

Learn More:

  • Virginia Community Capital is a Community Development Financial Institution (CDFI) with a mission to create jobs, energize places, and promote an enhanced quality of life for Virginians.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Borrower Stories, Low Income Designated Credit Union

How The Council On Alcoholism And Drug Abuse Of Northwest Louisiana Is Leveraging A Credit Union Partnership To Rebuild People’s Self-Worth

Bill Rose recently celebrated a big milestone: 34 years of sobriety. That also happens to be nearly how long Bill has been active in rehabilitation facilities. Six months into his recovery from drug and alcohol addiction, Bill began volunteering in drug treatment programs. At the time, he worked for a local oil company, but he also helped out at a hospital-based inpatient recovery program near where he lived in Louisiana. When Bill was laid off from his job in 1989, his life could have spiraled back to late nights out and high-risk activities; however, instead, Bill continued forward on his path of recovery. 

Bill Rose, Executive Director of CADA

That’s because Bill was connected with Dan Talley, the Executive Director of The Council on Alcoholism and Drug Abuse of Northwest Louisiana (CADA). Dan’s wife, Bonnie, worked at the hospital where Bill volunteered, and when she heard that Bill was out of work, she introduced the two to each other. One week later, Bill was a full-time CADA employee. “CADA embraced me and gave me a place to land,” said Bill. “They helped to mentor me, support my recovery, and keep me in a safe place, and my career kind of took off from there.”

CADA was established in 1958. Since then, the nonprofit private health organization has continuously provided substance abuse and addiction treatment services to Northwest Louisiana. Today, CADA offers 12 programs out of four facilities that serve Shreveport, Bossier, Many, and many rural areas across Louisiana, including at every horse racetrack in the state. The nonprofit prides itself on offering services to anyone, including adults and teens, regardless of their ability to pay. CADA is able to do this through a wide variety of payment options that include Medicaid, private insurance, and, in some cases, state funding.

According to Bill, CADA helped him get into counseling, and after five or six years, he left the nonprofit to pursue opportunities that he never would have had without Dan Talley’s guidance and CADA’s support. However, in 1998, when a management position opened up at CADA, Bill didn’t have to think twice about whether or not to apply. He got the job, returned to CADA, and Dan Talley became his boss. Bill’s been at CADA ever since.

Over the years, Bill has served a number of roles at CADA. He’s been a program manager of the nonprofit’s drug court program, helping clients to avoid jail time by coaching them through an intensive, long-term recovery path. Additionally, Bill was a program director at one of CADA’s detox centers, during which time he was also responsible for a 71-bed care facility. More recently, since early 2012, Bill has served as CADA’s Executive Director, leading a team of roughly 100, which includes full-time, part-time, and contracted employees.

According to Bill, although it wasn’t easy to transition away from counseling and programming, he felt like stepping in to serve as executive director was something he needed to do. “Dan Talley left such an impression on me,” Bill said. “For whatever reason, he took an interest in my recovery and taught me how to be a counselor, and when he died, I said that I was going to commit myself to doing whatever CADA needed me to do.”

Bill Rose and Walter Abney, a Peer Support Specialist

Although these days Bill spends most of his time working with CADA’s accounting department, human resources staff members, and development team, he also gets to work closely with Susan Garcia, CADA’s Director of Client Relations and Engagement. Like Bill, and roughly half of CADA’s workforce, Susan is in recovery. However, when Susan first walked through CADA’s doors, she was wearing shackles. She completed CADA’s recovery program, applied for a cook job at the nonprofit, and steadily climbed the ranks to her current position. Susan played a vital role in CADA opening a location in Many, her rural hometown where she knew firsthand that there was a need for addiction recovery services. Today, Susan holds the honor of being Louisiana’s Peer Recovery Support Specialist of the Year.

“I still get chill bumps when I think about how Susan walked into our facility literally in shackles and now she’s in a position probably more than me to help people recover,” said Bill. “That story never gets old. That’s the cool part of being sober for 34 years: it’s to see the light come on in a person that’s broken, and their lives start progressing along in a manner that they didn’t even imagine.” 

The Financial Piece of Recovery

Two years ago, Susan happened to meet Cyndi Phillips at a fundraiser event with a CADA alumni group. Cyndi is the Director of Community Development at ANECA Federal Credit Union, a Louisiana-based credit union that first opened in 1939. CNote invests Impact CashTM dollars in mission-driven and FDIC- and NCUA-insured credit union partners like ANECA, generating returns on institutional investors’ cash allocations while supporting financially underserved communities across the country.

Cyndi and Susan met for lunch to discuss how they might work together, and ever since, ANECA has been one of CADA’s most supportive community partners. According to Susan, the credit union participates in just about every event that CADA hosts, and Cyndi is a regular fixture at CADA’s open houses and weekly Friday graduations, at which the credit union supplies the caps and gowns. “ANECA is a joy to work with,” Susan said, “and Cyndi supports everything we do.”

Susan Garcia and Tine Jolley, HR Manager at CADA

Importantly, ANECA also offers CADA clients financial literacy classes, which include training on how to detect and avoid predatory lending. Additionally, ANECA helps to get CADA clients on the path to opening up checking and savings accounts, as well as improving their credit scores. These are vital services, considering that many of CADA’s clients don’t have a state-issued identification card or driver’s license and would otherwise be unable to open a bank account. 

According to Bill, giving CADA’s clients the opportunity to take their cash and put it safely into an ANECA account is an important part of the recovery journey. “Money can be a trigger,” he said, “so for a big percentage of the folks that we treat, it’s not a good practice to keep money in your pocket. Bringing in a lending institution like ANECA has been beneficial for folks getting on their feet.” 

That was the case for Susan. According to her, before she was sober, and even early into her recovery, she thought that having a bank account was out of reach. However, thankfully, she was given the opportunity to open an account: a seemingly small accomplishment that helped to propel her forward in her recovery. That’s because, as she described it, having a bank account boosted her self-esteem and made her feel like a human again.

“Addiction has a significant impact in every area of a person’s life, including banking,” said Bill. “When we’re able to help someone get that first checking or savings account, do you know what it does for their self-esteem and self-worth? I can’t put a dollar value to it. The financial piece is a big part of the puzzle of trying to get some stability in life, and it’s amazing to see how ANECA’s work plays a part in people’s recovery.”

Learn More

  • The Council on Alcoholism and Drug Abuse of Northwest Louisiana (CADA)  is a 501(c)(3) non-profit, private health organization providing substance abuse services.
  • ANECA Federal Credit Union, a Louisiana-based credit union that first opened in 1939.
  • CNoteCNote is a women-led impact platform on a mission to close the wealth gap through financial innovation. Using the power of technology and a community-first framework, CNote enables corporations and individuals to efficiently invest at scale in fixed income and time deposit products that advance economic equality, racial justice, gender equity, and climate change initiatives.
By Borrower Stories

How Terri-Nichelle Bradley is Bringing Black Representation To Target’s Toy Aisles

Terri-Nichelle Bradley used to be frustrated with her job. What had begun as an exciting career with Sesame Street Live had shifted to working for a multi-national public relations agency. If handling corporate crisis communications wasn’t enough, Terri-Nichelle also had to carry the burden of being the senior-most Black woman at the company. She was tokenized by her white colleagues and saddled with the weight of expectation from her junior Black peers. According to Terri-Nichelle, she used to sit in her car every day and cry. She was miserable, and eventually, she was fired.

That’s when a 40-year-old Terri-Nichelle went on a quest to find her purpose — luckily, she didn’t have to travel far. On a popular mountaintop outside of Atlanta, Terri-Nichelle put the question “what am I supposed to be doing?” out into the ether. The answer she received was “look at your life.” Her subsequent reflections took her back to her Minnesotan childhood, where Terri-Nichelle’s mother surrounded her family with Black art and kept Black magazines on the coffee table. Even though she wasn’t necessarily surrounded by neighbors who looked like her, Terri-Nichelle grew up knowing that Black people could be successful. As a child, that knowledge allowed her to dream.

As Terri-Nichelle looked back at the Black representation that had been so integral to her upbringing, she had her mountaintop aha moment. As a mother of four, she’d been hearing more and more about the leaky STEAM pipeline — the educational pathway for students in the fields of science, technology, engineering, the arts, and mathematics in which underrepresented minorities, including women, often fall through the cracks. Terri-Nichelle wondered what she could do to reverse that trend. After some research, she decided to start Brown Toy Box, an educational play-kit company that makes toys to get BIPOC kids excited about STEAM careers.

Terri-Nichelle launched her company as a subscription service in October of 2017. By June the following year, she shut it down. According to her, she didn’t have the requisite business acumen, which meant that Brown Toy Box had been destined to fail fast from the beginning. However, Terri-Nichelle wasn’t discouraged. She’d learned about her customers and the market, and she was willing to give it another shot. “I said to myself, ‘if you’re going to do this, you’re going to do it right,” Terri-Nichelle said. “‘You’re going to have to do the training so that you can be very intentional and purposeful about how you’re going to relaunch this business.’”

Try, Try Again

Terri-Nichelle did just that. In total, she participated in eight incubator and accelerator programs. Terri-Nichelle decided to evolve away from subscription boxes, and although she still wanted to build her business around educational kits, she wanted to be “a creator of product, instead of a curator of product,” as she puts it. Despite the fact that she never wrote a book about astronomy or made puzzles about marine biology, Terri-Nichelle believed that, ultimately, it was better to believe in herself rather than to rely upon other small business owners to make Brown Toy Box work. “I’d never created anything like this before,” she said, laughing. “But I was like, ‘I can do it.’ It’s the audacity of just believing in yourself.”

Come the beginning of 2019, Terri-Nichelle was ready to make her second attempt at Brown Toy Box. She’d hired a toy designer, she’d created the Dadisi Academy crew (Black students at a fictitious school named after the Swahili word for “curious”), and she’d designed themed kits around subjects like chemistry, robotics, and coding. Initially, Brown Toy Box returned to selling primarily to schools, however, the company also began to sell direct-to-consumer. That’s when COVID-19 hit. The pandemic effectively paused all of Terri-Nichelle’s business operations. As schools shifted to remote learning, budgets were redistributed to provide hotspots and laptops for students, not educational kits. 

That’s when Terri-Nichelle got scrappy. She stopped paying herself and she grew her business into a full-scale educational toy manufacturing company that produces and curates STEAM toys and experiences for children, grades pre-k through 6th. Every toy, game, activity, piece of media, and DIY experience focuses on promoting inclusivity, celebrating Black children, cultivating curiosity, normalizing Black excellence, and building skills that create pathways to prosperous careers. When schools were once again ready to sign contracts and distribute Brown Toy Box kits to students in August 2020, so was Terri-Nichelle. “It’s about all kids having access to these toys,” she said, “because that’s how we’re going to change the narrative, and that’s how we’re going to make sure that Black people aren’t just seen as the athletes and entertainers.”

On Target

In January 2021, Terri-Nichelle got her biggest opportunity yet — pitching the toy buyers at Target Corporation. The meeting was on a Friday, and on the following Monday, Terri-Nichelle got the call: the retail giant wanted Brown Toy Box in every one of its stores. It was wonderful news, but it was also daunting. Despite previous funding she received from the Google for Startups Black Founders Fund and SheEO that helped her to grow during the pandemic, Terri-Nichelle didn’t have the money to ramp up production to meet demand — Target wanted nearly 40,000 kits. Terri-Nichelle reached out to her network to fundraise. “We didn’t have enough revenue to qualify for a bank loan,” she said. “One of my mentors who leads a bank told me ‘we won’t look at you for another couple of years.’”

Fortunately, Terri-Nichelle had previously been co-located in an incubator with Access to Capital for Entrepreneurs (ACE), a Community Development Financial Institutions (CDFI) that works in 68 counties in Georgia. CNote partners with CDFIs like ACE in communities across America, funding loans to small businesses, providing technical assistance, and empowering local entrepreneurs like Terri-Nichelle. 

Terri-Nichelle reached out to ACE, and the CDFI was able to get the toy manufacturer the necessary financing needed to execute the Target deal. Although the larger deal was eventually underwritten by many participating institutions, ACE funded the first $500,000 to Terri-Nichelle, which allowed Brown Toy Box to secure the inventory needed to enter 1,757 Target stores. However, in addition to lending, the CDFI’s founder and CEO, Grace Fricks, became a vocal advocate for Terri-Nichelle, and it helped to bring other Atlanta partners — including the Atlanta Wealth Building Initiative, 1863 Ventures, and Invest Atlanta — to the table to provide additional funding for Brown Toy Box’s inventory rollout across the country. 

“The reason that we are where we are right now is because we were able to get the capital,” Terri-Nichelle said. “That happened because some really strong women in the investment and finance sectors really showed up for me. So many small businesses have to leave Atlanta, and these women said ‘we want to change that narrative: we don’t want entrepreneurs to have to leave this city in order to make things happen. Women-owned businesses need that type of advocacy, because you don’t usually find it.”

Target Practice for the Future

According to Terri-Nichelle, once the ball started rolling, it never stopped. With funding in one hand and Target purchase orders in the other, she set out to secure office space, forge new partnerships, and grow her team. That’s when ACE provided Terri-Nichelle with technical assistance: the CDFI advised her on hiring and it reviewed contracts for her, particularly as she built out her executive team. “I’d never hired like this before,” she said, “so they were able to use their expertise to help me think through those important things.”

Terri-Nichelle fulfilled every one of those purchase orders, and Target has been selling Brown Toy Box products in its stores and online since October 2021. However, Terri-Nichelle and her team — which includes her two oldest sons — didn’t stop there. The company has a new partnership with Lakeshore Learning, its kits are available for purchase at The Village Retail, and it’s finalizing a partnership with Microsoft that will take the Dadisi Academy crew online by September 2022. If that wasn’t enough, Terri-Nichelle is also working on a licensing deal with a major global brand. According to Terri-Nichelle, she’s projecting $3.5 million in sales in 2022, which is up from $1 million in 2021 and $220,000 in 2020. 

Unsurprisingly, Terri-Nichelle is dreaming big for Brown Toy Box’s future. She wants to turn the Dadisi Academy into an animated series and she wants her company to be a global force of play-based, culturally responsive education. “We really want to blow out any limitations that anybody has ever put on us, including those limitations that we put on ourselves,” said Terri-Nichelle. “We can change the trajectory of so many kids’ lives. My goal is for a kid to walk up to me in 15 years and say ‘I’m a chemist because of Brown Toy Box. That’s my goal, and that’s my purpose.”

Learn More

  • Brown Toy Boxan educational play-kit company that makes toys to get BIPOC kids excited about STEAM careers.
  • Access to Capital for Entrepreneurs (ACE) – ACE is an SBA Microloan Intermediary, a USDA Intermediary Relender and a certified Community Development Financial Institution (CDFI).
  • CNote – Interested in helping create another story like Terri-Nichelle’s? CNote makes it easy to invest in great CDFIs like ACE, helping you earn more while having a positive impact on businesses and communities across America.
By Community Partners, Low Income Designated Credit Union

Meet Kaua’i Federal Credit Union, The CDFI Investing In Its Island Community

“I never thought I would end up working in a financial institution,” says Ivory Lloyd of Kaua’i FCU. Samoan born and raised on Kauaʻi, in her college years, she worked in non-profits mainly focused on sustainability. With an undergraduate degree in political science and an international master’s degree in sustainable development and corporate social responsibility, she had an ideal background for cooperative finance, but the financial services industry was the last place she thought she would find herself. 

Ivory Lloyd, COVID Recovery Program Manager at Kaua’i Federal Credit Union

Global travel led her back to her home on the island of Kauaʻi and after becoming a mom of two boys, Ivory started a business, The Lei Collective, teaching lei making. She realized quickly that her business, which was hosting workshops on how to make lei poʻo (Hawaiian flower crowns) was really more about creating spaces for people to gather than it was about working with flowers. Her lei poʻo workshops created the opportunity for her to meet women from around the world who, like her, were mothers or entrepreneurs, looking to do something constructive but also meaningful on a personal level.

“Finding time for yourself, as a mother or female entrepreneur, is no easy task,” she admits. “I discovered that women loved attending my lei workshops because it allowed them time to be surrounded by other women, and enjoy making something beautiful for themselves.” Quickly, she realized her ʻsuper powerʻ, inspired by the flowers, was in gathering people together and weaving their talents and conversations into a whole, a process embodied in the creation of a lei. When the pandemic hit, this opportunity to foster community through the business of lei making was put on hold. The silver lining was that COVID opened up time for her to pivot, as it did for many entrepreneurs. 

Kauaʻi is one of the smallest and most remote land masses on earth. In 1992, Hurricane Iniki caused devastating damage to the island. It is in times of great adversity that Kauaʻi and its community shine the brightest. Due to the inability of large groups to meet, Kauaʻi FCU began hosting small pau hana (after hours gatherings) at their newly opened Kilauea branch. The new branch provided a space for community members and leaders to meet, connect and talk about their challenges at a time when everything was shut down. Ivory attended, with a few other community members, and it was then that her interest in community building began to take a sharper focus. For the first time, she learned the distinction between credit unions and banks. The social mission behind credit unions and the way Kauaʻi FCU ʻfeltʻ and was being led, were completely different than any other financial institution she had ever known. 

“I knew nothing about credit unions until that day, and from that day forward, when I met with Monica (Belz, CEO at Kauaʻi FCU) and her team, all I knew was that I didn’t care how or when, but that I wanted to be a part of it,” she says. 

Starting as a teller, Ivory was able to meet the members and learn the mechanics of the credit union. She began helping Kauaʻi FCU’s Community Development team with rent relief programs including a program with Aloha United Way that no other credit union on Kauaʻi was involved in. In 2021, when it was clear the pandemic was not over, Kauaʻi FCU created a new position, COVID Recovery Program Manager, with a sole focus on creating economic resiliency for Kauaʻi. Ivory jumped into the role with trademark enthusiasm and was able to bring her work as a small business owner, mother and resident of Kauaʻi into full play. “I love bringing people together and I love to connect with them,” she says. “This really translates into the work that I do now, as an advocate for small businesses within the credit union space. I figure out how we can support them (however it may be) as a financial institution.” 

As the only credit union CDFI (Community Development Financial Institution) on the island of Kauaʻi, Kaua’i FCU is building resiliency in a network of public, non-profit and private sector partnerships in a way that has never been done before.

Tackling Kauaʻi’s Biggest Challenges

In 1947 — 12 years before Hawaiʻi became a state — Kauai Territorial County Federal Credit Union was established to provide county, state, and federal government employees and their families with basic financial support, and to invest in and grow the quality of life on the island. The credit union changed its name in 1990 to Kauaʻi Government Employees Federal Credit Union, and in November 2021, simplified it to Kaua’i Federal Credit Union. As its history suggests, the credit union’s membership primarily includes government employees and first responders, however, Kaua’i Federal Credit Union serves all of Kaua’i, and everyone can be eligible to join. This is a plus, considering that locals —  from keiki (children) to kupuna (elders) — face many of the same challenges living on Kauaʻi as their ancestors did. These challenges include a lack of affordable housing, natural disasters, and over reliance on a tourism driven economy. Unsurprisingly, each of these challenges was exacerbated during the COVID-19 pandemic.

As a partner of CNote’s Impact CashTM program, Kauaʻ’i Federal Credit Union has access to low-cost capital that it invests in its community. As an MDI with CDFI certification, Kauaʻi FCU has gained access to a lifeline of US treasury funds that channel resources to undercapitalized communities and create opportunities for local businesses and generate positive social impact. It couldnʻt be more needed. 

Here are three ways that Kaua’i Federal Credit Union is leveraging CNote’s Impact CashTM dollars in its community:

1. Rental Relief. At a time when mainland billionaires are gobbling up land on Kauaʻi, many locals live paycheck to paycheck, thus making Kaua’i Federal Credit Union’s Rent Relief and Housing Stability program one of its most impactful. Thanks to CDFI funding, the credit union partnered with the county to launch its Coronavirus Rent and Utility Assistance (CRUA). To date, the credit union has deployed more than $22 million to assist over 2,500 households. The program aims to create housing security for all Kauaʻi residents, regardless of whether they’re members of the credit union or not. “This is one of our strengths as a credit union,” says Ivory. “When we see an opportunity where we can be the conduit to support our community in ways that they otherwise would not have been able to: we say yes, 100%, we are in.”

Although there’s little that Kauaʻi Federal Credit Union can do to address the high cost of living, what it can do through rent relief is ensure that income disparity doesn’t drive local residents off the island. Anecdotally, Ivory shared this story:

“Kaua’i is a small island and our communities are even smaller. The people that we are helping to get rent relief are not just names and numbers on a spreadsheet; they are our friends, our kupuna, our neighbors, and our families! Every week I get a dozen texts thanking us for helping them with their rent, or asking us to come over and help them fill out paperwork. That’s what we do, we are small but we know our community because it is us. Just the other evening, we were watching the sunset on the beach and one of the guys who we had helped get rental relief came in from surfing, ran down the beach to me and said, ʻI didn’t think this could happen.’ He was in disbelief. Because of our rental relief program, he was able to save some money and go to school to become an EMT. Ensuring that the kids who grew up on Kauaʻi are able to survive the pandemic and better themselves is one of the impacts that this rental relief program is having.”

(From left to right) Monica Belz-President and CEO, Chantal Zarbaugh-Business Development Officer, Dana Hazelton- Community Development Officer, and Ivory Lloyd- COVID Recovery Program Manager.

2. Environmental Resilience. Kaua’i has an abundance of natural beauty but more and more, the island is subject to devastating natural disasters. While most people think of firefighters, police officers, and lifeguards as first responders, Kaua’i Federal Credit Union is also a first responder. Because Ivory and her colleagues are so connected to the community, the credit union is always just a text message away from responding to the next emergency and providing assistance in whatever ways it can. “We are always trying to think about how we can best prepare ourselves to be ready for anything,” says Ivory. “It’s part of our DNA.”

For example, in March 2021, following a major landslide in an area still recovering from catastrophic flooding, Kauai Federal Credit Union’s Monica Belz and the Community Development team launched the Hawai’i Sister Society via zoom at 8:00 a.m. By 10:00 a.m, they were in boots and gear, packed up to bring a truck load of food across the Hanalei River in a dinghy boat with other community members. With road access cut off in and out of Hanalei, Ivory set up a pop-up branch on the North side of the river to offer financial services, provide rental relief and accept deposits while roads and bridges were repaired. “I’ve never seen this from a financial institution,” Ivory says, “but this is who we are. We are a really small community, and this is one of our superpowers as a credit union: we show up.” 

3. Economic Diversification. Like the rest of Hawai’i, Kauaʻi’s economy centers around tourism. When the COVID-19 pandemic grounded planes on the mainland, the island instantly lost its major revenue stream. Once this happened, Ivory says people began to realize that they needed to do things differently, including thinking about their shared economic sustainability. As the owner of a small business that primarily catered to tourists, she herself had to think about how she could pivot her business to be tied more to Kaua’i and less to those visiting it. 

Programmatically, Kaua’i Federal Credit Union is also addressing this issue. First, the credit union immersed itself in the Paycheck Protection Program (PPP), distributing loans ranging from $300 to $300,000. These forgivable loans helped to keep small businesses afloat during the worst of the pandemic so that entrepreneurs had the necessary time to make changes for the future. To date, Kaua’i Federal Credit Union has deployed $24.2M in COVID relief.

Ally and Gabe Avalon, owners of Avalon Gastropub, were recipients of a PPP loan from Kaua’i Federal Credit Union

Secondly, the credit union partnered with Common Ground Kauai, launching an incubator program to help local small businesses to create and export agriculturally based products. Thirdly, the credit union collaborated with the nonprofit Lady Entrepreneurs + Innovators of Kauai to create women-focused courses on marketing, finance, and business. “We had women who worked in the tourism industry for 20+ years,” says Ivory. “When the tourism industry shut down, a lot of people made their side gigs their main gigs, so we created these courses to give them whatever they needed to help them succeed.” 

As the pandemic continues to change everyday life, Ivory’s position as the COVID Recovery Program Manager will become more focused on creating a resilient and diverse economy so the island can thrive in the long term. Whatever this looks like – whether through rental relief, small business wrap around services, or the creation of innovative lending products for the next generation of homeowners, Kauaʻi FCU is on the front lines every day. “We know that infusing capital back into our communities to support a more cyclical economy will ensure our island and its people can thrive and become a model for other places around the world.”

Learn More:

  • Kaua’i Federal Credit Union helps the people of Kaua’i by keeping money on the island for a stronger financial future for our people. They offer their members the financial services and products that are right for them at preferable rates and at little or no cost, ensuring the wellness and wealth of future generations.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Borrower Stories, Community Partners

How Metropolitan Economic Development Association Is Scaling Itself To Shrink Minnesota’s Racial Wealth Gap

Over the course of their careers as inpatient nurses, Murwo Elmi, Ikraan Abdulle, Farhia Abdulahi, and Faiso Abdulle have seen a bit of everything. From their first shifts, the Minneapolis-based health professionals have cared for patients struggling with mental health, chemical dependence, physical and cognitive limitations, and homelessness. After 10 years, however, the group shared a similar realization: once their patients were released back into their communities, they didn’t have the support and stability necessary to avoid becoming either hospitalized or institutionalized again.

The OurPlace Residential Services team: (from left to right) Farhia Abdulahi, Ikraan Abdulle, Murwo Elmi, Faiso Abdulle

In 2017, the quartet started having a conversation about how their marginalized patients could be better served. Rather than establish a group home, the Somali-born nurses wanted to create a community space that fostered healing, independence, and stability. They called it OurPlace Residential Services. “There’s a need for this population to be served in a community setting,” said Ikraan. “Instead of being institutionalized, we wanted to be able to work with individuals and to address their social needs through community support, which is essential to everyone’s health.” “Patients need a stable home where they can see themselves for a long time,” added Faiso. “Not a 30-day shelter.”

According to the nurses, their vision to establish such a space had never been done before — at least not in Minneapolis. However, regardless of how much research the team did to educate themselves on how to create the best possible programs, policies, and protocols, one daunting challenge remained: securing the capital necessary to acquire an apartment building and to renovate it to meet their needs. The entrepreneuring nurses approached multiple banks in Minnesota, but they were told the same thing everytime: they didn’t have the necessary collateral or capital to turn their dream into a reality. 

The Creativity To Say ‘Yes’

That’s when the nurses at OurPlace Residential Services connected with Patrick Pariseau, the vice president of lending and client services at Metropolitan Economic Development Association (Meda). Founded in 1971, Meda is a Minneapolis-based Community Development Financial Institution (CDFI) that works exclusively with Black, Indigenous, and People of Color (BIPOC) entrepreneurs. In its first 50 years, Meda has served more than 25,000 BIPOC entrepreneurs, helping to build generational  wealth and to address the racial wealth gap in the communities it serves. Meda partners with CNote through the fintech company’s Wisdom Fund, which was set up to serve the exact demographic that the CDFI strives to empower.

Eleven years ago, Patrick stepped out of semi-retirement to join Meda’s team. After 30 years of banking, Patrick wasn’t seeking another job, but one of his friends who worked at Meda asked him if he would be interested in helping out with a couple of the CDFI’s loans. Patrick said “yes,” and less than three months later, he was a full-time Meda employee. When Patrick joined Meda, the CDFI had 14 loans in its portfolio. Today, the CDFI has a portfolio of 647 loans, totaling approximately $21 million. That amount is quickly growing to $40 million. 

Patrick Pariseau, Meda’s Vice President of Lending

That growth, in part, is thanks to the work Meda was able to do during the second round of Paycheck Protection Program (PPP) lending. Meda tapped into its local community and told everyone from CPAs to other lenders to send any sole proprietor and small business owner who needed help to contact the CDFI. Incredibly, with only two employees dedicated to PPP, Meda deployed 467 loans to local small business owners: approximately $11 million. Each of those loans went to a BIPOC entrepreneur, and 97% of those entrepreneurs identified as Black or African American. To date, 97% of Meda’s PPP loans have been forgiven. 

While those numbers speak for themselves, Patrick gets more excited about how the CDFI is able to achieve those lofty numbers and to create tangible impact in its community. According to him, Meda’s success is rooted in the following:

1. Creativity is in Meda’s DNA. “You have to be creative in this business,” Patrick said. “There are things we can do as a CDFI that banks can’t do.” For example, like other CDFIs, Meda’s underwriters place less emphasis on a small business owner’s credit score and more emphasis elsewhere, such as the person’s character and the business’ scalability. The CDFI also double weights cash flow, which allows for more entrepreneurs to qualify for lending. “Businesses run on cash flow,” said Patrick. “That’s the way it should be underwritten.”

Meda believes so much in the importance of cash flow that its primary lending product is built around it. Meda is one of the few CDFIs in the country to offer operating lines of credit. According to Patrick, operating lines of credit require fewer dollars and effectively allow the CDFI to deploy more loans to more small business owners. Patrick refers to it as an “equity product,” because the loans have modified, interest-only payment terms and they give small business owners the opportunity to put their cash back into their young businesses. “People need to put payments into their business, not the banking system,” he said.

2. Meda is scaling to the size of the problem. Like CDFIs across the country, Meda invests in small businesses not just so they can keep the doors open, but so they can grow. However, while many small-but-mighty CDFIs bend over backwards to help entrepreneurs scale their businesses, Patrick says that many CDFIs forget that they too need to scale. 

Not Meda. Thanks to a technology grant, the CDFI is currently piloting a new, integrated computer system — the same one commercial banks use — to be able to offer automated loan applications from anywhere in the country. Similarly, Meda invested in state-of-the-art underwriting software that’s been rated as one of the top five scalable systems in the country to help businesses grow. According to Patrick, that’s why Meda was able to meet the community’s PPP demands: the CDFI had already laid the foundation for itself to grow. “We’re scaling Meda to the size of the problems here in the Twin Cities,” he said. “These disparities aren’t going away unless we scale and continue to deepen our impact.”

3. Meda views banks as partners. Having spent three decades in banking, Patrick knows that banks aren’t CDFIs’ enemies: banks are regulated. However, even though Meda can be creative to serve its community in flexible ways that banks can’t, the CDFI still works very closely with local financial institutions. Because Meda strives to help its borrowers scale to over $1 million in revenue in less than 36 months, Patrick says that it’s in banks’ best interests to refer customers to Meda’s technical assistance programs. 

Meda has a few business consultants on staff; however, to scale its impact, the CDFI created what it calls the Volunteer Accelerator Network, where skilled volunteers virtually assist entrepreneurs through curricula designed to prepare small business owners to be successful. “We know that technical assistance works,“ Patrick said, “and if a bank refers a client to us and if they become successful, then I’m going to send that business owner back to that bank, because that means Meda can recycle its cash quicker and deploy another loan. That leverage is crucial for us.”

Additionally, every year, Meda deploys $20-$40 million in companion financing with partner banks, primarily in the form of real estate deals. For example, Meda is involved with a $6 million deal to build Minnesota’s first detox center for women. The CDFI invested $2 million in the project, and a partnering community bank put up the remaining $4 million. “The bank feels more comfortable with it because they got less risk,” Patrick said. “And because we all worked to make it happen, somebody gets a new building and a brand new business opportunity that’ll pay taxes and hire workers. That’s what it’s all about.”

Kari Groth Swan, Meda’s Director of Philanthropy and Investment and Patrick Pariseau, Meda’s Vice President of Lending

It Takes A Village

In fact, after saying “no,” a bank referred the nurses behind OurPlace Residential Services to Meda. The bank knew it was the exact kind of project that Meda would want to fund. That’s because in addition to supporting BIPOC and women entrepreneurs, Meda is committed to revitalizing neighborhoods through commercial diversification. To do that, the CDFI favors working with entrepreneurs in struggling neighborhoods who own non-retail companies like manufacturing facilities, medical clinics, and child care centers. Additionally, Meda works closely with aging small business owners to sell their businesses to BIPOC entrepreneurs to help create neighborhood sustainability. By choosing to take on a more eclectic portfolio of small business borrowers, Meda is doing its part to revitalize neighborhoods in its community. 

Unsurprisingly, Meda was behind OurPlace Residential Services from the very beginning. The CDFI leveraged its contacts in the real estate community to locate a promising apartment building, and it was unfazed by the $2.5 million price tag to acquire and renovate it. Patrick had trust in his construction background, and Meda is engaging with potential funding partners, like the City of Minneapolis, to position OurPlace Residential Services’ new building for success.

Thanks to Meda, OurPlace Residential Services is on course to open its building to its first 14 clients later this year. The nurses have already grown their team to 15 direct support staff members: a number that is likely to keep growing. That’s because, longterm, OurPlace Residential Services’ goal is to help eliminate housing instability and homelessness in its community. To do that, the nurses want to multiply their innovative model for patient-centered care across the Twin Cities metropolitan area, providing long-term housing opportunities to patients, regardless of where they are in their recovery journey.

In pursuit of that goal, OurPlace Residential Services will continue to rely on and collaborate with community partners like Meda. “Sometimes, we look at one another, and we say ‘is this really happening?’” said Murwo. “It’s amazing, and we couldn’t have done it without Meda taking that chance on us. We needed an ally who had the knowledge and understood the community’s needs, and we needed a champion that really loved the idea. That’s what we got with Meda. They made this happen.”

Learn More

  • OurPlace Residential Services
  • Metropolitan Economic Development Association (Meda) was founded in 1971 with a mission of Helping BIPOC Entrepreneurs Succeed.
  • CNote is a women-led impact platform on a mission to close the wealth gap through financial innovation. Using the power of technology and a community-first framework, CNote enables corporations and individuals to efficiently invest at scale in fixed income and time deposit products that advance economic equality, racial justice, gender equity, and climate change initiatives.
By Borrower Stories

Meet Lorain Francis, Whose Full-Time And Volunteer Jobs Are To Fight Food Insecurity In Maine

Although Lorain Francis hasn’t always worked on the frontlines of food insecurity, she’s been surrounded by volunteerism for as long as she can remember. Lorain grew up in Fairport, New York, where both of her parents were active volunteers in the community. Unsurprisingly, when Lorain grew up and owned a local retail business, she started to volunteer with the merchant’s association to revitalize the town’s main street. 

Lorain Francis

Fifteen years ago, Lorain and her husband moved to his hometown of Union, in an under-served area of coastal Maine, where Lorain found a job at the Chamber of Commerce in Rockland. That ultimately led her to the Maine Development Foundation, where Lorain got the chance to work with communities across the state, doing what she loved. However, after about five years working with Mainers near and far, Lorain began to feel disconnected from the last place she expected: the place she called home. “I realized that I lost my sense of my own community, because I was in everybody else’s community,” Lorain said. “I wanted to make a difference in my own community again, so the thing to do was to get involved locally.”

That’s when Lorain took a job at Penquis, a community action organization in Maine. At Penquis, Lorain helps to administer a federal AmeriCorps grant that places senior volunteers in eight food pantries and a soup kitchen in Mid-Coast Maine. Lorain is the program director for an initiative called Knox County Gleaners, which partners with local and backyard farmers and residents to harvest and redistribute fruits and vegetables to nearby food pantries. Last year, Lorain’s team helped to distribute over 22,000 pounds of vegetables to 22 locations in Knox County. 

It was about two-and-a-half years after joining Penquis that Lorain ultimately found what she calls her “volunteer job” at Come Spring Food Pantry, one of Knox County’s food pantries. Come Spring was started over 20 years ago as a community service project, and when the founder decided to retire, Lorain decided that, given her background in community building, she was the right person to step in and help the organization grow.  

A Lender To Dream With

Even before March 2020, Come Spring was bursting at the seams in its cramped, hard-to-find space located in the basement of a town building. The COVID-19 pandemic exacerbated those struggles. According to Lorain, not only did social distancing restrictions limit how many people could be present in the tiny pantry at any one time, but it was challenging for community members to access new pickup locations, even as need increased. To make matters worse, Lorain says that there wasn’t enough space to store surplus food, which meant that the nonprofit had to rent another room, which soon became a financial burden for the organization.

Come January 2021, Lorain knew what she needed to do: find a larger space. She and her team began to look around Union to see what was available. A few weeks later, she toured 27 Common Road. Despite that the 2,800-square-foot building was in major need of repairs (snow was falling through the roof), Lorain knew that it was Come Spring’s new home. The next obstacle? Figuring out how the small (but mighty) food pantry was going to be able to purchase it.

Lorain reached out to a colleague at AIO Food & Energy Assistance, another pantry that had just gone through a building campaign, to ask for advice. That’s how Lorain learned about a Community Development Financial Institution (CDFI) called The Genesis Fund. Since 1992, The Genesis Fund has been working to develop and support affordable housing and community facilities across Maine, mainly by providing both financing and technical assistance to increase the supply of affordable housing. CNote partners with CDFIs like The Genesis Fund in communities across the country, channeling capital to fund social missions like affordable housing, women’s empowerment, entrepreneurial funding, and more. 

When Lorain connected with The Genesis Fund, she instantly knew she found the right financing partner. Not only did the CDFI have an impressive portfolio of similar projects, but, as Lorain describes, the CDFI “dreamed with us as a fledgling pantry wanting to grow big.” The Genesis Fund offered Lorain and her team everything Come Spring needed, including assistance with the loan application and coaching. In the end, being challenged to think about Come Spring’s past, present, and future ultimately helped the food pantry to “grow up,” Lorain said. 

On February 12th, Come Spring made its purchase offer to the building’s owners, and, incredibly, the deal closed on March 31st — 64 days after Lorain and the CSFP Teams initial decision to move the pantry’s location. Meeting the March 31st deadline was significant, Lorain explained, because doing so meant that Come Spring didn’t have to pay taxes on the building for the next year. Therefore, the speed for which The Genesis Fund and the lawyers were able to help Come Spring close on its offer saved the food pantry $3,500. “For us, that’s huge,” Lorain said. “Genesis was amazing to work with. They believed in us from the beginning, and everybody pulled together and made it happen.”

Food Brings People Together

These days, Lorain has a lot on her plate. Once the real estate deal was finalized and the pantry secured its larger space, it was time to get to work. The first thing that needed to be done was to repair the building, namely installing a new roof. However, because Lorain wanted the new building to be a beacon for those experiencing food insecurity, it had to be painted barn red. The addition of “huge signs” helped to ensure that the building can’t be missed — it’s now visible more than a half-mile away.

Come Spring officially opened its new pantry on July 10th, 2021 and the location has quickly become a long-term food storage hub for other food pantries and food security groups in western Knox County. Besides the much larger food pantry and a big parking lot, Come Spring now has in its plans a storage room, a classroom, and a commercial kitchen, where volunteers can process food (e.g. make apple cider) and prepare take-home meals. The pantry Knox County Gleaners was also able to acquire a CoolBot, an energy efficient walk-in cooler, which ties back to the work that Lorain does with produce redistribution at Knox County Gleaners. Another way Come Spring has established itself as a community center is by hosting Union’s weekly farmers’ market, which consistently attracts large crowds. 

Today, Lorain and her team of volunteers open Come Spring to the community every Wednesday with both daytime and evening hours. In July the pantry will switch from pre-packed boxes to a client choice shopping model just one year after moving to the new pantry. Providing a small grocery store experience and atmosphere allows people to shop for what their families’ preferences are, she said. “It gives people choices, it gives them dignity, and it empowers them to be able to choose what they want.”

Since moving into its new facility, Come Spring estimates that it will be able to increase its capacity to provide services to additional families, including the elderly, couples, veterans, large and small families and anyone struggling with food security in the region. 

“We encourage people to come and get food basics from us and spend their saved income on gas, heat and to keep their car running so they can get to work and children to school. I don’t want anyone in my community to not know that there are food pantries here where anyone can get food,” Lorain said. “It’s a labor of love, and I love making sure that everybody in western Knox County is fed. It doesn’t get any better than that.”

Learn More

  • Come Spring Food Pantry is a food pantry in Knox County, Maine, with a mission of feeding their neighbors with dignity while promoting health, opportunity and hope.
  • The Genesis Fund provides innovative financing by soliciting investment loans from individuals, churches, corporations, and foundations, and then re-lending the money at favorable terms to nonprofit organizations developing affordable housing and community facilities for underserved people and communities throughout Maine and beyond.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Community Partners

How Capital For Change Uses CNote To Create More Possibilities In Its Community

For the better part of 15 years, Charles Bodie worked for a large, multinational investment bank and financial services holding company, first in private wealth management, and later in credit risk. Although he enjoyed his work, when Charles relocated to New Haven, Connecticut nearly three years ago, he began to look for other employment opportunities. That’s how he learned about Capital for Change, the largest full-service Community Development Financial Institution (CDFI) in Connecticut. 

Charles Bodie, Capital For Change’s Chief Financial Officer.

While Charles didn’t initially set out to work in the CDFI sector, he says that he was attracted to Capital for Change because of its mission-driven practices. “The loans and other activities that Capital for Change do really make a difference for people that otherwise might not receive those opportunities from other financial institutions,” he said. “For me, that just meant so much.” In 2019, Charles became Capital for Change’s Director of Finance and Reporting, and he’s since stepped into the position of Chief Financial Officer. 

Capital for Change was created in 2016 after three established CDFIs — Community Capital Fund, Greater New Haven Community Loan Fund, and Connecticut Housing Investment Fund — merged into one. Today, each of Capital for Change’s programmatic, product, and service offerings are rooted in those founding CDFIs’ combined decades of experience and expertise. According to Charles, Capital for Change takes a diverse approach to lending, which centers around what the CDFI refers to as “The Core Four.” Those complementary missions include affordable housing, energy efficiency lending, loan servicing, and community development loans. “The need for affordable housing is paramount, but the fact that we can actually touch on multiple missions is even better.” Charles said. “The more we can do in more diverse ways, the better.”

Charles is especially excited about Capital for Change’s energy efficiency loans, which help homeowners to conserve energy usage and decrease costs through audits, retrofits, and alternative/clean energy improvements. Charles estimates that on the consumer side, the CDFI has originated more than $87 million in efficiency loans. These loans stem from various programs and funding initiatives — ranging from replacing 80-year-old oil furnaces to installing solar panels — led by Connecticut’s Public Utilities Regulatory Authority. Because the state utilities cannot be a lender , the utilities funds are “farmed out” to various lending organizations, including Capital for Change. “The utilities created the products, and what we do is we bring the consumers together with the contractors that can do the work and use the utilities’ money,” Charles said. “We’re the ones who bring all of that together.”

Capital for Change also offers multifamily energy loans through a program called LIME (Low Income Multifamily Energy), in which the CDFI works on a project-by-project basis with property owners to make energy efficiency improvements to multifamily properties and condominium developments that meet certain requirements (e.g. no fewer than 5 units and at least 60% of units affordable to households at no higher than 80% of Area Median Income). According to Charles, to make those loans work, the CDFI treats the energy efficiency updates as a kind of collateral. “If we know that you’re going to save, say, $50,000 in maintenance and utility costs over the next 10 years,” he explained, “then when we put these improvements in place, you pay it back to us with those savings. It’s a novel way to approach energy efficiency lending.”

Charles shared an example from a recent project in Bridgeport, Connecticut. A partner organization constructed a charter school on an old manufacturing site, and Capital for Change funded an energy efficiency refurbishment. Capital for Change worked with a company to install a fuel cell so that the school, housing for tutors, and a future housing project would be able to generate its own electricity. “We funded the fuel cell project when no one else would,” Charles said. “That one project in and of itself is a real boon for a CDFI like us because it touched on education, energy efficiency, housing, and urban blight, and it’s been phenomenally successful.”

It’s with that same kind of diversified lending approach and multi-faceted mission orientation that Capital for Change is looking to the future. Specifically, Capital for Change is interested in piloting a small business lending program in the next year or two. Most of the CDFI’s current business loans are greater than $100,000; however, if piloted, Charles said that Capital for Change might offer loans as low as $5,000 to small business owners. Additionally, Capital for Change is considering new ways to find out what its community needs, mainly through survey work and collaborations with community organizations. “Traditionally, we didn’t ask anybody about needs because we know there’s a need for affordable housing and energy efficiency,” Charles explained. “But, what is it that we don’t know? What are we missing? That’s where getting in touch with the community is really important.”

 

‘CNote Wants Exactly What We Want’

Given the diverse nature of Capital for Change’s work, the CDFI is able to get funding from diverse investors, including banks and the state; as is the norm, those dollars come with usage restrictions related to programs or loan types. While Charles and his team are appreciative of every loan and investment that flows into Capital for Change, he says that working with CNote changes the paradigm. “CNote wants exactly what we want, and they follow our mission,” he said. “Because so much of the funding that we receive is specific to project or loan type, there are only certain loans that qualify; but, everything can be funded with the money that CNote provides, and that’s been an excellent resource.”

Charles said that funds that come into the CDFI through CNote’s Flagship Fund create myriad possibilities for Capital for Change. For example, with CNote dollars, Capital for Change can free up capital from existing loans. That means that Capital for Change can replace money in one of its current loans with CNote money to free up capital for another loan. According to Charles, that creates other possibilities for the CDFI, including passing the benefits on to its clients by lowering interest rates on future loans.

Additionally, Charles has found that working with CNote has lightened typical CDFI reporting requirements, freeing up administrative time and costs so that he and his colleagues can focus on perpetuating Capital for Change’s missions. “CNote has really filled the space for CDFI borrowers like us,” Charles said. “For traditional banks, our world is a bit alien to them, but for CNote, they’re showing that lending evolves. They’re at the forefront of that evolution, and that’s another aspect that makes our partnership with them work really well.”

Learn More

  • Capital For Change is the largest full-service Community Development Financial Institution (CDFI) in Connecticut.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Community Partners

Easy As C-C-C: How Access to Capital for Entrepreneurs Uses Capital, Coaching, and Connections to Help Georgia’s Small Business Owners Thrive

Martina Edwards knows what it’s like to be given an opportunity to break down barriers. Thanks to a nonprofit that helps place high-achieving graduates of color in Wall Street firms, Martina started her career in 2001 and became Merrill Lynch’s first Black female broker on the floor of The New York Stock Exchange in 2004. She spent the next 10 years working on and off Wall Street, including time running the alternative investments program for the same organization that helped her land her job at Merrill Lynch. According to Martina, that’s when she truly began to understand the importance of capital, particularly in terms of creating generational wealth and economic growth.

Eventually, Martina returned to her southern roots and moved to Atlanta, where she started to reflect on what she wanted to do long term with her career. She knew she wanted to be on the forefront of working with minority women in business enterprises, but she didn’t know exactly what that might look like. That’s when Martina found herself listening to a panel discussion featuring Grace Fricks, the founder and CEO of Access to Capital for Entrepreneurs (ACE), a Community Development Financial Institutions (CDFI). Grace started ACE in 1997 in rural northern Georgia with an initial grant of $50,000 to support small business owners across the state. Like many financial services professionals, Martina wasn’t aware of CDFIs when she worked on Wall Street; however, as she learned more about ACE’s impact, especially with women business owners, she knew she wanted to get involved. 

Twelve months later, Martina joined ACE’s team as the CDFI’s chief of strategic partnerships. For the past three years, Martina’s main focus has been fundraising so that ACE can create more access to capital for small business owners. “We give folks a chance when others can’t or won’t,” said Martina. “But it’s not just helping one small business owner. When we create financial security for a business owner, that creates more financial security for their employees, and that allows their households to thrive.”

The Three C’s

ACE is the largest small-business-oriented CDFI in Georgia that focuses on women, people of color, and low- to moderate-income business owners. An important part of the organization’s mission is to decrease the gender and racial wealth gaps, particularly for Black and Latinx communities who continue to face the racial discrimination inherent to our modern financial systems. Importantly, ACE’s staff is a reflection of the ethnically diverse communities that the CDFI serves, and Martina and her colleagues live in rural, suburban, and urban communities throughout North Georgia. That representation is essential, especially as ACE works to build trust with small business owners who’ve traditionally been overlooked and undercapitalized by traditional lenders.

 

Like all CDFIs, ACE is mandated to deploy at least 60% of its capital to its target markets. While ACE has historically funneled at least 80% of its capital into those markets, in 2021, the CDFI managed to bring that percentage up to 94. Martina credits those percentages to intentionality on the part of her and her colleagues, but also to the geographic footprint in which ACE operates. ACE’s headquarters is in Cleveland, Georgia, a rural town of fewer than 4,000 residents, and while the CDFI supports metro hubs like Atlanta and Savannah, it also works in suburban counties such as Gwinnett, which is the most diverse county in the Southeast. In total, over the past 22 years, ACE has provided loans and business advisory services to support more than 2,000 small business owners across 68 counties in Georgia. 

According to Martina, ACE’s target demographic of small business owners face a host of challenges, including a knowledge gap, a capital gap, a trust gap, and, more often than not, a social capital gap (i.e. the lack of a network) — all of which are rooted in decades of inequality. To address these challenges, ACE employs what it calls the three C’s: capital, coaching, and connections:

1. Capital. Lending is at ACE’s core, and the CDFI offers small business loans (up to $50,000) and commercial loans ($50,001 to $1 million). However, ACE also collaborates with other organizations to deploy capital in different ways. Such creative collaborations have focused on interest rate buy-downs, loan guarantees, and longer term limits. ACE also participated in a number of initiatives that emerged during the COVID-19 pandemic, including the Southern Opportunity and Resiliency (SOAR) Fund, a program that matches small business owners with CDFIs across 15 states and Washington D.C.

ACE was actually able to increase its lending during the pandemic. In fact, between 2020 and 2021, ACE deployed more capital than it had in the previous five years combined. ACE was able to do this, in part, through the Paycheck Protection Program (PPP). In 2020, ACE lent just over $25 million, $4.5 million being PPP loans. In 2021, those numbers grew to $37.3 million and $10.5 million, respectively. Of the $10.5 million PPP dollars deployed in 2021, 54% went to women and $68% went to Black borrowers. Overall, 90% of ACE’s PPP loan recipients had five or fewer employees, and many were sole proprietors. “There were businesses that were on the brink,” Martina said. “Through the PPP process, we were able to stand with them in the gaps. We were really blessed to have great long-term relationships with lending partners like CNote that were willing to lend us low-cost capital that we specifically needed for PPP loans.”

2. Coaching. ACE knows that the key to growing sustainable businesses is to pair capital with coaching. As Martina puts it, “you got the capital, but what do you do with the capital?” To help small business owners answer that question, ACE has a growing team of business advisors who work hand-in-hand with entrepreneurs. ACE currently has a six-to-one client-to-employee ratio, which helps to explain why the CDFI’s default rates are typically  under 2%. In 2021, the CDFI dedicated more than 18,000 hours to business consulting. ACE’s “high-touch” approach, as Martina describes it, is especially centered around financial operations, business operations (e.g. cybersecurity best practices and human resources), and resiliency. “There’s relief, there’s recovery, and there’s reinvention,” she said. “We want our borrowers to be better operators, to be stronger, and to be sharper around those particular skill sets.”

3. Connections. Because ACE knows that many of its clients don’t have a network of other small business owners to rely upon, it strives to forge connections, whether between entrepreneurs or to resources. The CDFI has two women business centers that are certified through the Small Business Administration. It’s important to note that each women’s business center is gender agnostic and open to everyone. Although business coaching is an integral part of these hubs, these spaces are an ideal place for ACE to host lunch and learns, webinars, and training workshops. For example, in the wake of the COVID-19 pandemic, ACE partnered with LinkedIn to train local entrepreneurs how to pivot their brick-and-mortar businesses to e-commerce marketplaces.

ACE also offers small business owners the opportunity to participate in four different cohorts depending on where an entrepreneur is with their business at a given point in time. “As a business owner, it can be a lonely world,” said Martina, “and sometimes you feel like you’re the only person going through something. At the end of the day, it’s helpful to give small business owners a network of people that they can depend on, rely on, learn from, and possibly cross pollinate and share ideas.” 

Unlocking Opportunities

ACE recently engaged a strategic planning firm to help determine long-term strategy. In the coming years, Martina says that ACE sees a unique opportunity  to deepen their work and expand operations across Georgia, and the CDFI believes it can  deploy $100 million in capital to support women, BIPOC, and low- to -moderate income business owners in the next three to five years. Should the CDFI achieve its goal, it will be a noteworthy accomplishment: in its entire 22-year existence, ACE has deployed $140 million in capital. Martina notes that investments in improving the capacity of our people, technological infrastructure, and capital resources will be critical given the overwhelming volume of demand and the speed at which clients need capital. To set itself up for success, she says that ACE will establish new partnerships and deepen current ones. For example, ACE is a CNote Wisdom Fund Partner, which has given the CDFI access to a targeted pool of funds to further its lending. “Our mission is growing sustainable businesses, but the vision is also closing  wealth and opportunity gaps,” said Martina. “The Wisdom Fund is supporting us so that we’re able to do that.”

Additionally, just like ACE offers its clients an opportunity to network, Martina says that CNote has helped ACE connect with peer CDFIs across the country who’ve shared best practices, strategies, and ideas that have helped to make ACE more efficient. Similarly, ACE has gained visibility from CNote’s platform, which attracts impact investors, donors, and individuals from localities well beyond Georgia’s borders who want to support women business owners. “I feel like we’re the best kept secret, but we don’t want to be the best kept secret,” Martina said. “That’s why CNote is such an instrumental partner for us beyond capital, because CNote can talk about us in rooms that we don’t necessarily get access to.”

Learn More

  • Access to Capital for Entrepreneurs (ACE) is a Georgia 501(c)(3) nonprofit and community development financial institution (CDFI) that provides capital, coaching, and connections to help borrowers create and grow sustainable businesses that generate jobs.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.

 

By Community Partners, Low Income Designated Credit Union

Meet Education Credit Union, Whose Scholastic Roots Sprout Innovative Programs In The Texas Panhandle

While Education Credit Union (ECU) may be 86 years old, it’s finding new ways to empower its community in Amarillo, Texas. Founded in 1935, the credit union was originally named Amarillo School Employees Credit Union, and it catered to teachers and administrators in the district. However, in 2010, the credit union rebranded itself and dropped the requirement that members had to work in education. Rebrands, however, can come with a steep learning curve, and ECU soon discovered that it had to come up with new approaches to connect with new members.

To help educate community members that they don’t have to be employed by a school to join the credit union, in 2020, ECU decided to pair its decades-old brand recognition with a new tagline: “Learn More, Live More ®.” According to Eric Jenkins, ECU’s CEO, those words say it all. “We’re staying true to our scholastic roots, because we wouldn’t exist without the educators who founded us,” he said, “but the ‘education’ part of our name is we are striving to teach consumers financial responsibility and wellness so that they can live more.”

The new tagline seems to be working. Today, the credit union has seven branches (with another one on the way), and it serves more than 30,000 members in a 16-county radius. Like many financial institutions, ECU offers its members a variety of services, including checking accounts, savings accounts, and loans. Additionally, it offers free financial education classes focused on all ages from preschool to adults. However, what separates ECU from traditional lenders and other credit unions is its array of innovative, community-centric programs. 

Eric Jenkins, the CEO of Education Credit Union

Here’s a look at four of ECU’s most unique offerings:

1. New Teacher Loans: True to its roots, one of ECU’s flagship services is new teacher loans, which are offered to recently hired educators who have yet to receive their first paycheck. Because it can take upwards of six weeks to receive that first paycheck, the credit union wanted to provide new teachers with a non-credit score based product to help fill that gap and allow those employees to meet whatever financial needs they have during that time. 

2. AmTech Career Academy: This past fall, the Amarillo School District opened up a state-of-the art, 231,000-square-foot vocational campus called AmTech Career Academy. The academy is dedicated to training more than 2,800 high schoolers to pursue one of 37 career paths, free of charge. In early 2022, ECU will not only open its first branch inside an Amarillo School District school, but it will staff that branch with senior apprentices from AmTech’s School of Business, Marketing, and Finance. These students will be hired as paid interns, and they’ll receive high school credits while they gain valuable financial services experience that could one day translate into a full-time role with a credit union or bank.  

3. BUFF $MART Program: In partnership with West Texas A&M University (whose mascot is a buffalo), ECU launched a financial literacy boot camp designed for college students. Since 2018, more than 300 students have gone through the program, and many of those participants actually received college credit for completing the coursework. Additionally, graduates of the program are invited to return and help lead future iterations of the boot camp. According to Eric, this program could easily be replicated by other credit unions that serve university partners in their footprint. “You would think that college students would have a base level of education on financial services,” he said,” but it’s discouraging how little many know about basic things like how checking accounts and credit cards work. These are smart kids from diverse backgrounds and it is so rewarding to see them benefit from what in reality is financial success training.  We really hope other credit unions will build similar programs and stand ready to support those efforts and share our lessons learned.

4. Pocket Change Grants: ECU takes team members giving back to the community to another level and focuses on the importance from day one of employment. As a result, more than 98% of ECU employees donate a portion of their paychecks to help fund Pocket Change Grants. The credit union’s board matches all contributions, and every year, ECU awards grants up to $500 to local teachers to purchase learning tools, address students’ basic needs, or fund activities and field trips. Notably, grant recipients do not have to be members in order to be eligible to receive funding from ECU. Since the program was launched in 2009, ECU has donated more than $500,000 to school districts across the Texas Panhandle. In 2021 alone, ECU donated $149,753 to 325 local teachers. 

For Lindsey Murphy, ECU’s senior vice president of marketing and business development, Pocket Change Grants are arguably her favorite part of her job. Lindsey grew up in the community, and her mother was a teacher in the Amarillo School District. As soon as Lindsey turned 16 and got a job, her mom drove her to ECU to open her first checking account. All these years later, she feels blessed to be able to give back to local schools in such a meaningful way. “It’s so rewarding to see the smiles on our team members’ faces when they get to go into the schools and deliver the checks,” Lindsey said. “Every employee that donates gets the opportunity to go out and physically deliver one to a teacher and enjoy that experience and see that donation go to work.”

Lindsey Murphy, Education Credit Union’s senior vice president of marketing and business development

According to Lindsey, ECU is able to come up with and deliver on such unique programs because, collectively, her and her colleagues have their fingers on the pulse of what’s going on locally: not just in the area school districts, but holistically in the surrounding communities. Recently, that heightened level of awareness led ECU to be more intentional about attracting and recruiting bilingual employees who can better serve the credit union’s Spanish-speaking members. After strategizing with its HR team, ECU updated its job posting preferences, created an all Spanish ad and translated one of its job applications into Spanish. The credit union’s efforts were rewarded: 40% of its new hires are bilingual. “We knew that in order to effectively serve the communities where we exist in the language that they need, then we were going to have to make changes,” Eric said. “We had to be intentional, and we’re going to continue to make that a priority.”

As ECU continues to strive to look more like the community it serves, both Eric and Lindsey are excited for what’s to come for the credit union. As they look forward to exciting announcements in 2022 and beyond, one thing is clear: after 86 years, ECU’s best years are still ahead of it. “We have the opportunity to create more value for consumers in the Panhandle of Texas than any other institution here,” Eric said. “Like I said before: we’re going to help people learn more about their financial lives so that they can make their whole lives better.”

Learn More

  • Education Credit Union’s mission is to excel in service, care and financial protection for members and their families. The Education Credit Union proudly serves members in Amarillo, Bushland and Canyon, Texas.
  • CNote is a women-led investment platform that empowers individuals and institutions to invest locally to further economic equality, racial justice, gender equity, and address climate change.
By Borrower Stories

How Toni Hopkins Embraced Her Entrepreneurial Side To Open Cool J’s Apparel During The Pandemic

In the years leading up to the COVID-19 pandemic, Toni Hopkins and her husband talked about moving from their home in Springfield, Illinois to North Carolina to pursue what she describes as “something different.” They’d even gone as far as to meet with a real estate agent to explore selling their house. Ultimately, the couple abandoned their plans to pursue a fresh start at the onset of the pandemic. However, Toni’s desire for “something different” persisted. That’s when she began to listen to the entrepreneurial voice in her head that had spent the past three years telling her to start her own business.

Toni Hopkins, Founder of Cool J’s Apparel.

For Toni, the idea of opening her own business was something of a fantasy. After more than 18 years working in accounting and finance, she was tired of the monotony. Over her career, she’d heard people — coworkers, friends, family members — vocalize wanting to do something different with their lives but never acting on those wants. Toni’s problem was that she knew she wanted to start a business, but she didn’t know what kind of business she wanted to start. She’d even stumbled across a vacant commercial space near her home in Springfield that she determined would be perfect for her nameless, yet-to-be-created future store.

During the early weeks of the COVID-19 pandemic, when stay-at-home mandates went into effect and Toni began to work from home, something changed inside of her. Not only did she and her husband decide to stay planted in Springfield, but that’s when she decided that she was going to shift from talking about opening her own business to actually making it happen. “The pandemic hit, and I said ‘okay, this is the time for me to actually do this,’” she said. “Like everybody else, I started working from home, and I realized that I could be doing something else with my time that I wanted to do instead of pushing numbers.”

Fortunately, Toni was surrounded by a supportive husband, daughter, and son who encouraged her to embrace her entrepreneurial side. She set her fears aside and began to look for the right business opportunities in her community. It didn’t take her long to connect the dots between one of her passions — fashion — and the fact that there weren’t many black-owned clothing boutiques in town that sold trendy yet affordable clothes and accessories. Toni had found her business idea: Cool J’s Apparel. Amazingly, the “perfect” commercial space that she’d seen from her car window a year earlier and fallen in love with was still available. Even more amazing was the fact that Toni was able to work with the landlord to sign a lease.

Falling Into Place

According to Toni, every aspect of her business seemed to effortlessly fall into place. Through her research, she’d learned that women were continuing to purchase clothing during the pandemic and that boutiques like the one she wanted to open continued to be profitable amidst the wide-scale economic uncertainty. That helped to shape the business plan that Toni wrote and carried with her to her local bank to apply for a small business loan. Although the banker told Toni that he couldn’t help her because the loan request wasn’t big enough, he told her to reach out to Justine PETERSEN, a Community Development Financial Institution (CDFI) that offers a variety of financial tools and service to help low- and moderate-income individuals and families achieve their personal financial goals. CNote partners with CDFIs like Justine PETERSEN in communities across the country, funding loans and empowering local entrepreneurs like Toni through CNote’s Flagship and Wisdom Funds.

Toni reached out to the CDFI in November 2020, and she quickly connected with Aida Richardson, Justine PETERSEN’s chief lending officer. “Aida was so helpful from the very beginning,” Toni said. “She just knew so much, which was the biggest help. This was my first time opening a business, but she’d done this hundreds of times, so Aida just made it so easy. She answered all of my questions and emails and didn’t hesitate to always point me in the right direction.”

With micro-enterprise lending from Justine PETERSEN, Toni was able to do everything she needed to open Cool J’s Apparel on May 28, 2021. According to her, the loan money from the CDFI helped her with every aspect of her business, from paying rent to completing renovations and from purchasing inventory to buying the iPad that she uses to complete sales. Additionally, Toni says that the CDFI helped her to make her business “become legit and successful,” meaning she was able to leverage those loan dollars to invest in marketing, advertising, and signage. Most importantly, even though Toni received her small business loan roughly 12 months ago, Aida and her colleagues at Justine PETERSEN continue to tell Toni that they’re always available whenever she needs anything, whether that’s a quick question that can be answered over the phone or ongoing technical assistance to help take her business to the next level. 

Unsurprisingly, Toni’s positive experience with Justine PETERSEN is largely why she describes opening Cool J’s Apparel as “so easy.” In the process, she’s inadvertently become one of the CDFI’s biggest cheerleaders. “I’ve been telling everybody about them,” she said, laughing. “They’ll let you know right away if they can help you or not, and if they can’t, then they’ll put you on the right path and they’ll give you the steps to help you. It’s a relationship that I’m really appreciative of, even today.”

‘I Love Doing What I’m Doing’

Although the COVID-19 pandemic couldn’t deter Toni from opening Cool J’s Apparel in May 2021, it did limit her ability to have a grand opening celebration — something she’s considering remedying in the coming weeks. That doesn’t mean that the women’s clothing store where “cute meets comfortable” has struggled to find its footing in Springfield. Business is going well, and Toni says the store enjoys support from both local customers and shoppers who drive down from Chicago. The broad geographic interest in Cool J’s Apparel stems from the fact that Toni carries stylish yet affordable clothes and accessories for all ages. “My customers are Black and white, young and old, and just really diverse,” she said. “I’m not joking. It’s craziness. I don’t know how people target one specific group, because I have such a big range of customers here.”

Cool J’s Apparel even attracts the occasional male customer, which has prompted Toni to consider incorporating a menswear section into her store — or perhaps into a larger location. In the nearterm, Toni would like to hire some help. Currently, Toni operates the store while she continues to work her part-time, remote nonprofit job, and although she appreciates the help she gets from her family, including her niece, she wants to either hire two part-time employees or one full-time staff member as soon as she’s able to. Additionally, Toni is interested in deepening her small business’ connection to the surrounding community, such as sponsoring events where all proceeds go to donating backpacks to the local school.

Even though Toni has the occasional quiet day at Cool J’s Apparel, she’s pleased knowing that when customers do come into her boutique, they tend to walk out with a bag of new clothes. “People that have never been my customers before, they come in and they find something that appeals to them,” Toni said. “I love that. Even on slow days, I still love being here and doing what I’m doing.”

Learn More

  • Cool J’s Apparel
  • Justine PETERSEN is a CDFI that connects institutional resources with the needs of low-to-moderate-income individuals and families in Missouri, helping them to build assets and create enduring community change.
  • CNote – Interested in helping create another story like this? CNote makes it easy to invest in great CDFIs like Justine PETERSEN, helping you earn more while having a positive impact on businesses and communities across America.
By Borrower Stories, Low Income Designated Credit Union

How Project Fighting Chance Is Going Beyond The Boxing Ring To Build Trauma Resiliency In San Bernardino’s Youth

When Terry Boykins was first approached to serve on the board of directors for a nonprofit called Project Fighting Chance, the social entrepreneur politely said “thanks, but no thanks.” It wasn’t because Terry wasn’t aligned with Project Fighting Chance’s mission to function as a viable safe space and trauma resilience support system for youth in San Bernardino, California. Terry’s own work was similarly rooted in community engagement; however, his background was admittedly in the corporate world, and Terry was hesitant to get involved with a nonprofit. 

Terry Boykins

A few years later, in 2016, Terry got his next offer to consider joining Project Fighting Chance’s board, just months after a terrorist attack left the community — and the country — in shock. This time, Terry visited the organization, he spoke with current board members, and, most importantly, he saw the nonprofit’s potential. Terry joined the board, and a year later, he stepped in as the organization’s interim executive director. In July 2020, he dropped the “interim” label and became the nonprofit’s full-time executive director.

One of the reasons that Project Fighting Chance was established in 1999 was to give youth a safe place to go after school. According to Terry, the hours between 3 p.m. and 7 p.m. are the most deadly for young people, especially in San Bernardino, the second-most dangerous city in California. That’s why the nonprofit opened its doors: to create a place for students to escape the pervasive poverty, food insecurity, prostitution, drugs, violence, robberies, car jackings, and home invasions around them. “When you talk about PTSD in the hood, it’s here,” Terry said. “These students are trying to navigate an environment where they’re confronted by violence and destruction on a daily basis, so we created a space for them to get away from that, where they can focus on their academic well-being, their emotional well-being, and getting an afternoon meal five days a week.”Since its inception, Project Fighting Chance has built itself a championship reputation within the national amateur boxing community. For example, in 2018, PBS released a docu-series following three of the nonprofit’s top boxers. However, when Terry came onboard, he set out to expand the organization’s programmatic offerings beyond boxing. “The boxing program was already a place where kids wanted to go,” he said, “but I’d been focusing on the obstacles that youth were confronted years down the road. I asked ‘what exactly can be done that will help these young people apply the techniques of boxing as they relate to overcoming issues or struggles or problems to get somewhere else in life?’ That’s when we began to have a different dialogue.”

Through that “different dialogue,” Terry and his colleagues at Project Fighting Chance have put together a dizzying assortment of programmatic offerings for youth between the ages of eight and 18 from San Bernardino and the surrounding communities. While boxing and workouts are still an integral part of Project Fighting Chance, the nonprofit has expanded to offer additional after-school enrichment programs like chess, art classes, horticulture, tutoring, and spoken word. There’s also a mental-health tranquility garden, where students can sit outside and eat lunch, meet with a counselor, or learn about nutrition. Additionally, the San Bernardino City Unified School District helped the nonprofit secure 40 guitars — a mix of acoustic and electric — for its Guitars Not Guns program. “We have a trauma-informed staff, so we understand who’s coming in the door,” Terry said. “It’s a very interesting time here when the guitar instructor and the students are able to come together through music to deal with some social-emotional dynamics that happened in their day.”

Going Toe-to-Toe With A Global Pandemic

Every Monday through Friday, Project Fighting Chance welcomes roughly 120 students through its doors, and in its 22-year existence, it has trained and mentored over 6,000 youth, free of charge. However, the nonprofit’s ability to fulfill its mission was thrown into question at the beginning of the COVID-19 pandemic. With both uncertainty around the virus’ transmission and state-mandated stay-at-home orders, Project Fighting Chance had to close its doors to the youth who needed it most. To make matters worse, much of the grant money that Project Fighting Chance relied on was retracted, which meant that the nonprofit was in immediate need from the Paycheck Protection Program (PPP) to keep afloat. 

Fortunately, a pastor from a nearby church referred Terry and his team to Self-Help Federal Credit Union. Self-Help is a low-income designated credit union that was chartered in 2008 to build a network of branches that serve working families and underserved communities. It currently has more than 78,000 customers across 19 branches in California, 10 branches in Illinois, and one branch in Wisconsin, and it has over $1.2 billion in assets. Like many credit unions in the U.S., Self-Help rose to the challenges presented by PPP loan issuance and forgiveness and acted as an economic shock absorber for the economy. CNote partners with low-income designated credit unions like Self-Help across the country through its Impact Cash Solution. 

Thanks to Self-Help, Project Fighting Chance applied for and received two rounds of PPP loans, which meant that the nonprofit did not have to lay off any of its six employees. The PPP funding also kept fuel in Project Fighting Chance’s tanks — literally. For the first 18 months of the pandemic, the nonprofit used its two vans to deliver 170 meals every day to youth around San Bernardino, ensuring that those experiencing food and transportation insecurity at home could still be served. “The PPP funding proved critical, because it allowed us to repurpose the organization to support young people and their parents in the community,” Terry said. “We were the place they could count on every day, and we basically got those funds and invested them into the community to make sure that we could stay available to these youth.”

Life Outside of the Boxing Ring

Although Project Fighting Chance had to limit its daily capacity to 15 students at the beginning of the pandemic, today, Terry and his team are back to serving over 100 youth a day. Despite the extended time away from face-to-face interactions, programmatically, Project Fighting Chance didn’t miss a beat during the pandemic. In September 2021, for example, the nonprofit kicked off a program called Civil Liberties for Boys of Color, where students got to speak with law enforcement officials — police officers, probationary staff, employees from the district attorney’s office — for 90 minutes every Friday. “These were real conversations,” said Terry. “These kids were scared of the police and not knowing if they’re going to make it back home today. So these folks came in and talked about the law, about behavior, and they talked to these young boys about having a voice for their concerns about living in their communities.”

To say that Project Fighting Chance has become much more than a place for youth to learn about boxing is an understatement. Today, youth are exposed to programs related to nutrition, mental health, sex trafficking, partner violence, civic engagement, and career development. Whether or not a student walks through the nonprofit’s doors wanting to be the next Muhammad Ali or the next Jimi Hendrix, they’re encouraged to train in the boxing gym, visit the tranquility garden, talk about mental wellness, and explore every aspect of STEAM (science, technology, engineering, arts, and math). 

Why? According to Terry, it’s not only about reducing childhood violence, trauma, and food insecurity, it’s about preparing these youth to be productive members of society. That means developing the coping skills to thrive in the labor force and the civic engagement skills to become informed voters and taxpayers. Therefore, it isn’t surprising that Terry’s most exciting day as executive director of the nonprofit was when he and the youth at Project Fighting Chance were invited to attend a San Bernardino City Council meeting to learn about how local government works. The organization filled every seat in the house, and, as Terry put it, the students got “a lesson outside of the boxing ring that was priceless.

Whether it’s local council members, California state assembly members, school district administrators, teachers, mentors, counselors, therapists, coaches, parents, or credit unions like Self-Help, Terry is quick to acknowledge the broad community support and partnerships that Project Fighting Chance not only enjoys, but relies upon to be successful. “We are not where we are because we’re doing great things,” Terry said. “We are where we are because there are some great people helping us do some very good things after school in this community.” 

Learn More

  • Project Fighting Chance‘s Mission is “to function as a viable safe space and trauma resilience support system for youth and young adults at-progress while assisting them to become positive contributing members of the community.”
  • Self-Help Federal Credit Union was chartered in 2008 to build a network of branches that serves working families and underserved communities. Serving more than 78,000 members, Self-Help Federal is one of the fastest-growing low-income designated credit unions in the country. 
  • CNote – Interested in helping create another story like this? CNote makes it easy to invest in great Credit Unions like Self-Help, helping you earn more while having a positive impact on businesses and communities across America.
By CNote

Impact Platform CNote Announces Conversion to Public Benefit Corporation

New legal designation affirms CNote’s longstanding commitment to closing the wealth gap and uplifting communities with sustainable solutions.

 March 30, 2022 // Oakland, CA // CNote, a woman-led impact platform, has announced its official conversion to a Public Benefit Corporation (PBC).

 Since its founding in 2016, CNote’s fixed income and cash products have streamlined millions in scalable investments from individuals and corporations. Dollars invested and deposited on the CNote platform are deployed with mission-driven financial institutions to fund underserved communities and BIPOC entrepreneurs in line with the firm’s mission to close the wealth gap.

A supermajority of CNote’s stockholders voted to formalize a transition to a PBC, further aligning the company with its practice of enhancing equitable community development through financial empowerment. CNote’s specific public benefit purpose is to advance greater economic and social justice for underserved communities by unlocking access to impact investments. Now, unlike traditional corporations that primarily focus on maximizing only shareholder value, CNote can also ensure that decisions are made in light of achieving this specific purpose.

“Becoming a Public Benefit Corporation has allowed the company’s charter to reflect CNote’s core values that motivate us every day,” said Yuliya Tarasava, COO and co-founder of CNote. “This conversion means CNote will always be pushing for greater capital access for underserved groups that have long been neglected by the financial mainstream.”

As a Delaware Public Benefit Corporation, CNote’s Board of Directors will have a mandate to balance the economic interests of stockholders with its stated public benefit purpose, allowing it to take into account the material interests of all stakeholders affected by the company’s operations, including the underserved communities CNote supports and CNote’s partner financial institutions, clients, and employees.

 

About CNote