U.S. Treasury dismantles locally important development fund

The Trump Administration on Friday reportedly fired the entire staff of an office in the Treasury Department that runs a broadly popular program that helps local loan funds in places that are typically underserved by banks, including Native American reservations.

The Community Development Financial Institutions that get the funds loan them out to small businesses to help develop local economies, often for higher rates than a bank might charge if they were interested.

Those CDFIs include the Coulee Dam-based Northwest Native Development Fund (NNDF) that has helped businesses starting up locally and around the Northwest.

That CDFI firm, with just three people on staff, is still in business. The federal CDFI money typically seeds local lenders with enough money to allow them to attract private funds, averaging eight times the federal investment in boosting local, usually rural, economies.

But that agency at the Treasury Department was reportedly shuttered Friday amid the federal government shutdown game of chicken now starting its third week in a fight over healthcare funding, with each side blaming the other for the impasse.

"We are tired. Tired of seeing our communities, our small businesses, and our livelihoods used as political pawns in a game where we all lose," the NNDF staff writes in a letter to the editor on page 2.

In business for 13 years, NNDF, with the motto "the little loan fund that could," has helped several local businesses grow, including Billups Sub Co., Auntie Dannee's, Coulee Kids Daycare, and more. And they're efforts extend at least as far away as Jackson, Montana, home of a "Bunkhouse Hotel."

They've made 253 loans, invested $14.538 million, according to their website, and also offer business planning services and help with marketing plans.

At Treasury, the CDFI Fund employed 102 employees, according to its 2024 financial report. Treasury was preparing to lay off 1,400 people. News reports on Saturday had the number of federal workers so far at about 4,000 with thousands more underway in many departments.

Bloomberg Law called it part of an effort to make the shutdown "as painful as possible" for Democratic constituencies, which President Trump stated last week that it would be.

The White House Office of Management and Budget had proposed eliminating the CDFI Fund in its latest budget proposal. Politico reported Tuesday that fired employees were told in a letter that their termination was necessary to implement the abolishment of the program.

The outlet reported that Republican senators from Idaho and South Dakota are pushing back, noting the latter state had received $13.3 million from the program last year - per capita one of the most of any state.

Sen. Mike Crapo, from Idaho, is the Senate Community Development Finance Caucus co-chair with Sen. Mark Warner a Democrat of Virginia.

Warner told Politico neither of them saw the layoffs coming and they were working to "show strong, bipartisan pushback."