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12 U.S.C. § 4706 — Selection of institutions
Federal law — U.S. Code and appendices · legal_authorities
**(a) Selection criteria** Except as provided in [section 4712 of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title12-section4712&num=0&edition=prelim), the Fund shall, in its sole discretion, select community development financial institution applicants meeting the requirements of [section 4704 of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title12-section4704&num=0&edition=prelim) for assistance based on—
(1) the likelihood of success of the applicant in meeting the goals of its comprehensive strategic plan;
(2) the experience and background of the management team;
(3) the extent of need for equity investments, loans, and development services within the investment areas or targeted populations;
(4) the extent of economic distress within the investment areas or the extent of need within the targeted populations, as those factors are measured by objective criteria;
(5) the extent to which the applicant will concentrate its activities on serving its investment areas or targeted populations;
(6) the amount of firm commitments to meet or exceed the matching requirements and the likely success of the plan for raising the balance of the match;
(7) the extent to which the matching funds are derived from private sources;
(8) the extent to which the proposed activities will expand economic opportunities within the investment areas or the targeted populations;
(9) whether the applicant is, or will become, an insured community development financial institution;
(10) the extent of support from the investment areas or targeted populations;
(11) the extent to which the applicant is, or will be, community-owned or community-governed;
(12) the extent to which the applicant will increase its resources through coordin
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Source file: Laws/federal/codes/united-states-code/title-12/section-4706-selection-of-institutions--a6e7ca018e.md
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Source location: Title 12, Chapter 47, § 4706; chapter-047-community-development-banking.md
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**(a) Selection criteria** Except as provided in [section 4712 of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title12-section4712&num=0&edition=prelim), the Fund shall, in its sole discretion, select community development financial institution applicants meeting the requirements of [section 4704 of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title12-section4704&num=0&edition=prelim) for assistance based on—
(1) the likelihood of success of the applicant in meeting the goals of its comprehensive strategic plan;
(2) the experience and background of the management team;
(3) the extent of need for equity investments, loans, and development services within the investment areas or targeted populations;
(4) the extent of economic distress within the investment areas or the extent of need within the targeted populations, as those factors are measured by objective criteria;
(5) the extent to which the applicant will concentrate its activities on serving its investment areas or targeted populations;
(6) the amount of firm commitments to meet or exceed the matching requirements and the likely success of the plan for raising the balance of the match;
(7) the extent to which the matching funds are derived from private sources;
(8) the extent to which the proposed activities will expand economic opportunities within the investment areas or the targeted populations;
(9) whether the applicant is, or will become, an insured community development financial institution;
(10) the extent of support from the investment areas or targeted populations;
(11) the extent to which the applicant is, or will be, community-owned or community-governed;
(12) the extent to which the applicant will increase its resources through coordination with other institutions or participation in a secondary market;
(13) in the case of an applicant with a prior history of serving investment areas or targeted populations, the extent of success in serving them; and
(14) other factors deemed to be appropriate by the Fund.
**(b) Geographic diversity** In selecting applicants for assistance, the Fund shall seek to fund a geographically diverse group of applicants, which shall include applicants from metropolitan, nonmetropolitan, and rural areas.
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Assistance**
(1) **In general** — The Fund may provide assistance for the purpose of providing capital to organizations to purchase loans or otherwise enhance the liquidity of community development financial institutions, if—
(A) the primary purpose of such organizations is to promote community development; and
(B) any assistance received is matched with funds—
(i) from sources other than the Federal Government;
(ii) on the basis of not less than one dollar for each dollar provided by the Fund; and
(iii) that are comparable in form and value to the assistance provided by the Fund.
(2) **Limitation on other assistance** — An organization that receives assistance under this section may not receive other financial or technical assistance under this subchapter.
(3) **Construction of Federal Government funds** — For purposes of this subsection, notwithstanding section 105(a)(9) of the Housing and Community Development Act of 1974 [[42 U.S.C. 5305(a)(9)](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title42-section5305/a/9&num=0&edition=prelim)], funds provided pursuant to such Act shall be considered to be Federal Government funds.
**(b) Selection** The selection of organizations to receive assistance under this section shall be at the discretion of the Fund and in accordance with criteria established by the Fund. In establishing such criteria, the Fund shall take into account the criteria contained in sections 4704(b) and 4706 of this title, as appropriate.
**(c) Amount of assistance** The Fund may provide a total of not more than $5,000,000 of assistance to an organization or its subsidiaries or affiliates under this section during any 3-year period. Assistance may be provided in a lump sum or over a period of time, as determi
Source: Supplied U.S. Code snapshot — release unconfirmed · 12 U.S.C. § 4712
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Form and procedures** An application for assistance under this subchapter shall be submitted in such form and in accordance with such procedures as the Fund shall establish.
**(b) Minimum requirements** Except as provided in sections 4705 and 4712 of this title, the Fund shall require an application—
(1) to establish that the applicant is, or will be, a community development financial institution;
(2) to include a comprehensive strategic plan for the organization that contains—
(A) a business plan of not less than 5 years in duration that demonstrates that the applicant will be properly managed and will have the capacity to operate as a community development financial institution that will not be dependent upon assistance from the Fund for continued viability;
(B) an analysis of the needs of the investment area or targeted population and a strategy for how the applicant will attempt to meet those needs;
(C) a plan to coordinate use of assistance from the Fund with existing Federal, State, local, and tribal government assistance programs, and private sector financial services;
(D) an explanation of how the proposed activities of the applicant are consistent with existing economic, community, and housing development plans adopted by or applicable to an investment area or targeted population; and
(E) a description of how the applicant will coordinate with community organizations and financial institutions which will provide equity investments, loans, secondary markets, or other services to investment areas or targeted populations;
(3) to include a detailed description of the applicant’s plans and likely sources of funds to match the amount of assistance requested from the Fund;
(4) in the case of an applicant that has previously received assistanc
Source: Supplied U.S. Code snapshot — release unconfirmed · 12 U.S.C. § 4704
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Application** An application for assistance may be filed jointly by a community development financial institution and a community partner to carry out a community partnership.
**(b) Application requirements** The Fund shall require a community partnership application—
(1) to meet the minimum requirements established for community development financial institutions under [section 4704(b) of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title12-section4704/b&num=0&edition=prelim), except that the criteria specified in paragraphs (1) and (2)(A) of [section 4704(b) of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title12-section4704/b&num=0&edition=prelim) shall not apply to the community partner;
(2) to describe how each coapplicant will participate in carrying out the community partnership and how the partnership will enhance activities serving the investment area or targeted population; and
(3) to demonstrate that the community partnership activities are consistent with the strategic plan submitted by the community development financial institution coapplicant.
**(c) Selection criteria** The Fund shall consider a community partnership application based on—
(1) the community development financial institution coapplicant—
(A) meeting the minimum selection criteria described in [section 4704 of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title12-section4704&num=0&edition=prelim); and
(B) satisfying the selection criteria of [section 4706 of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title12-section4706&num=0&edition=prelim);
(2) the extent to which the community partner coapplicant will participate in carrying out the partnership;
(3) the exte
Source: Supplied U.S. Code snapshot — release unconfirmed · 12 U.S.C. § 4705
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Federal law — U.S. Code and appendices · legal_authorities
**(a) Forms of assistance**
(1) **In general** — The Fund may provide—
(A) financial assistance through equity investments, deposits, credit union shares, loans, and grants; and
(B) technical assistance—
(i) directly;
(ii) through grants; or
(iii) by contracting with organizations that possess expertise in community development finance, without regard to whether the organizations receive or are eligible to receive assistance under this subchapter.
(2) **Equity investments**
(A) *Limitation on equity investments* — The Fund shall not own more than 50 percent of the equity of a community development financial institution and may not control the operations of such institution. The Fund may hold only transferable, nonvoting equity investments in the institution. Such equity investments may provide for convertibility to voting stock upon transfer by the Fund.
(B) *Fund deemed not to control* — Notwithstanding any other provision of law, the Fund shall not be deemed to control a community development financial institution by reason of any assistance provided under this subchapter for the purpose of any other applicable law to the extent that the Fund complies with subparagraph (A). Nothing in this subparagraph shall affect the application of any Federal tax law.
(3) **Deposits** — Deposits made pursuant to this section in an insured community development financial institution shall not be subject to any requirement for collateral or security.
(4) **Limitations on obligations** — Direct loan obligations may be incurred by the Fund only to the extent that appropriations of budget authority to cover their cost, as defined in [section 661a(5) of title 2](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title2-section661a/5&num=0&edition=
Source: Supplied U.S. Code snapshot — release unconfirmed · 12 U.S.C. § 4707
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Federal law — U.S. Code and appendices · legal_authorities
Page 1736
TITLE 12—BANKS AND BANKING
§ 4706
(d) Limitation on distribution of assistance
Assistance provided upon approval of an appli-
cation under this section shall be distributed
only to the community development financial
institution coapplicant, and shall not be used to
fund any activities carried out directly by the
community partner or an affiliate or subsidiary
thereof.
(e) Other requirements and limitations
All other requirements and limitations im-
posed by this subchapter on a community devel-
opment financial institution assisted under this
subchapter shall apply (in the manner that the
Fund determines to be appropriate) to assist-
ance provided to carry out community partner-
ships. The Fund may establish additional guide-
lines and restrictions on the use of Federal
funds to carry out community partnerships.
(Pub. L. 103–325, title I, § 106, Sept. 23, 1994, 108
Stat. 2171.)
§ 4706. Selection of institutions
(a) Selection criteria
Except as provided in section 4712 of this title,
the Fund shall, in its sole discretion, select com-
munity development financial institution appli-
cants meeting the requirements of section 4704
of this title for assistance based on—
(1) the likelihood of success of the applicant
in meeting the goals of its comprehensive
strategic plan;
(2) the experience and background of the
management team;
(3) the extent of need for equity invest-
ments, loans, and development services within
the investment areas or targeted populations;
(4) the extent of economic distress within
the investment areas or the extent of need
within the targeted populations, as those fac-
tors are measured by objective criteria;
(5) the extent to which the applicant will
concentrate its activities on serving its in-
vestment areas o
Source: Supplied 2024 U.S. Code historical extraction · 12 U.S.C. § 4706
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