                                 CODE OF VIRGINIA

VIRGINIA COMMUNITY DEVELOPMENT FINANCIAL INSTITUTIONS FUND AND PROGRAM; REPORT
(§ 36-140.01)

A. For the purposes of this section:
			&#8220;Financing&#8221; means (i) loans, grants, or forgivable loans that are
used to start, expand, or support small businesses or nonprofit organizations;
to provide operating and working capital to small businesses; or for property
renovation or development or (ii) ancillary services related to such loans,
grants, or forgivable loans, including technical assistance and credit
counseling.
			&#8220;Fund&#8221; means the Virginia Community Development Financial
Institutions Fund described in subsection B.
			&#8220;Microfinancing&#8221; means providing financing to small businesses in
amounts of $100,000 or less.
			&#8220;Program&#8221; means the Virginia Community Development Financial
Institutions Program described in subsection C.
			&#8220;Qualifying institution&#8221; means a community development financial
institution (CDFI), community development bank (CDB), or community development
credit union that the Secretary of Commerce and Trade finds is (i) legally
qualified to do business within the Commonwealth, (ii) subject to oversight by
the applicable federal or state financial institution or insurance regulatory
agencies, and (iii) eligible for certification by the U.S. Department of the
Treasury as a CDFI.

B. There is hereby continued in the state treasury a special nonreverting fund
known as the Virginia Community Development Financial Institutions Fund,
originally established in Item 114, Chapter 552 of the Acts of Assembly of 2021,
Special Session I. The Fund shall be continued on the books of the Comptroller.
All funds appropriated for such purpose and any gifts, donations, grants,
bequests, and other funds received on its behalf shall be paid into the state
treasury and credited to the Fund. Interest earned on moneys in the Fund shall
remain in the Fund and be credited to it. Any moneys remaining in the Fund,
including interest thereon, at the end of each fiscal year shall not revert to
the general fund but shall remain in the Fund. Moneys in the Fund shall be used
solely for the purposes of providing financing to qualifying institutions as
part of the Program established by subsection C. Expenditures and disbursements
from the Fund shall be made by the State Treasurer on warrants issued by the
Comptroller upon written request signed by the Director of the Department of
Housing and Community Development.

C. 1. There is hereby created the Virginia Community Development Financial
Institutions Program to provide grants and loans to qualifying institutions to
provide financing to support small businesses, housing development and
rehabilitation projects, and community revitalization real estate projects in
the Commonwealth. In providing financing to small businesses, qualifying
institutions shall emphasize microfinancing.

   2. a. Qualifying institutions shall be required, as a condition of receiving
   funds from the Program, to use such funds only for the purposes described in
   this section. Such funds shall be kept segregated by the qualifying
   institutions from all other funds. In the event that funds provided by the
   Program are used for any purpose other than those described in this section,
   the qualifying institution shall repay such funds to the Program.
   				b. Notwithstanding the provisions of subdivision a, (i) income in the form
   of interest, fees, or gains earned by a qualifying institution from providing
   financing and (ii) administrative costs incurred in administering Program
   funds shall not be subject to the restrictions provided by subdivision a.

D. The Department shall develop appropriate criteria and guidelines for the use
of funding provided from the Fund and shall establish monitoring and
accountability mechanisms for organizations receiving funding. Additionally, the
Department shall (i) identify qualifying institutions based on criteria
developed by the Department and in accordance with this section; (ii) ensure
that grants and loans provided by the Program are utilized in a manner that
aligns with the Program&#8217;s goal of promoting housing and community
development, capital access, housing access, and small business support; (iii)
ensure that in using funds provided by the Program, qualifying institutions
emphasize microfinancing to small businesses; (iv) establish a mechanism for
obtaining repayment of misused funds in accordance with subdivision C 2 a; and
(v) utilize Program funds to promote collaborative and cooperative projects with
public and private sector partners that align with the purposes of the Program.

E. On or before December 1 of each year, the Department shall submit a report to
the Secretary of Commerce and Trade, the Governor, and the Chairmen of the House
Committee on Appropriations and the Senate Committee on Finance and
Appropriations. The report shall describe the number of projects funded; the
geographic distribution of the projects; the costs of the Program; and the
outcomes, including the number and total amount of loans, grants, and forgivable
loans deployed, the number and type of jobs created or retained, and other
community revitalization projects associated with the Program. The report shall
also provide information on such other matters regarding the Fund as the
Department may deem appropriate or other items as may be requested by any of the
foregoing persons to whom such report is to be submitted.

HISTORY: 2023, cc. 639, 640.