WASHINGTON—In a sharp reversal of the Trump Administration’s earlier move, the mass reduction-in-force (RIF) notices issued to all employees of the CDFI Fund last month have been rescinded, according to internal emails reviewed by Punchbowl News.
The notices had threatened terminations in December as part of a broader effort by the Office of Management and Budget (OMB) under Director Russ Vought to pressure congressional Democrats to drop their objections in the budget-funding fight.
For the credit-union movement, the signal is loud and clear: critical community-development infrastructure may yet be preserved, sources stated.
“Reinstating the entire CDFI Fund staff is an essential and welcome step toward restoring a program that has proven itself indispensable to underserved and military communities,” said DCUC Chief Advocacy Officer Jaso Stverak. “The CDFI Fund isn’t just another federal initiative—it is a lifeline for servicemembers, veterans, and low-income families who rely on mission-driven lenders for safe, affordable financial services.”
Stverak pointed out that defense credit unions have seen firsthand how CDFI resources strengthen financial readiness—an issue that directly impacts military readiness.
“Eliminating staff would have severely disrupted the ability of community-focused institutions to offer affordable housing solutions, small-business lending, emergency loans, and financial counseling to those who need them most,” he told CUToday.info.
Monday’s reported reinstatement is progress, but the job is not done, Stverak said.
“We urge Treasury and Congress to fully restore the CDFI Fund’s operations, funding, and award cycles,” he said. “DCUC stands ready to work with policymakers to ensure this program remains strong, stable, and fully capable of serving the communities that depend on it. Our military families deserve nothing less.”
ACU Responds To Decision
“On behalf of the nearly 500 CDFI-certified credit unions and their members, America's Credit Unions thanks the Administration for acknowledging the importance of the CDFI Fund and continuing its workforce," said Scott Simpson, America's Credit Unions president/CEO, adding that ACU is a leader in CDFI Fund advocacy, fighting for funding and reforms to maintain its effectiveness. "We are grateful to the congressional leaders who championed the fund and fought alongside us to protect it. Our unified advocacy made clear that communities across the country rely on CDFIs to spur business investment, innovation, affordable housing developments, and more. These credit unions are essential to the financial resiliency and vibrancy of our country, and we look forward to continuing to work with the administration to strengthen the effectiveness of the fund.”
Dennis Dollar Not Surprised
“While this is a great development, it is not necessarily a surprise," stated former NCUA chairman Dennis Dollar. "The Trump Administration took some actions such as this to put pressure on the other party -- which supports the CDFI program big time -- during the government shutdown.
"I don’t think they ever intended to shut down the program because Secretary (Scott) Bessent has stated his support for the CDFI program several times publicly," continued the principal of Dollar Associates, based in Birmingham, Ala. "But there are always gives and takes in negotiations, and it is good for credit unions and a lot of underserved communities that this is now clearly a giveback as many of us expected. Although not a surprise, still a nice win.”