The U.S. Department of the Treasury announced that the Community Development Financial Institutions Fund (CDFI Fund) will issue rules on how CDFI Fund awards are treated under the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA) and will implement reforms aimed at ensuring certified Community Development Financial Institutions (CDFIs) comply with federal anti-discrimination laws. A forthcoming notice of proposed rulemaking will clarify that certain benefits constitute “federal public benefits” for PRWORA purposes, meaning illegal aliens and other non-qualified aliens would not be eligible to receive those taxpayer-funded benefits. Treasury is also adding a new provision to relevant CDFI Fund agreements to address practices that violate federal anti-discrimination laws, including employment or financial preferences or set-asides based on race, ethnicity, or sex in a manner inconsistent with federal laws; certified CDFIs must adopt and maintain compliance policies and procedures, certify annually regarding their existence and administration, and make them available for CDFI Fund review upon request. The CDFI Fund indicated it may pursue remedies for noncompliance with agreements, including potential decertification, termination of unused funds, and recapture of past award funds.
U.S. Department of the Treasury 2026-04-09
U.S. Department of the Treasury announces PRWORA rulemaking for CDFI Fund awards and new anti-discrimination compliance requirements for certified CDFIs
The U.S. Department of the Treasury’s Community Development Financial Institutions Fund will issue rules clarifying the treatment of CDFI Fund awards under the Personal Responsibility and Work Opportunity Reconciliation Act of 1996, including that certain benefits are “federal public benefits” not available to non-qualified aliens. Treasury will also amend CDFI Fund agreements to require certified Community Development Financial Institutions to maintain and annually certify anti-discrimination compliance policies, with potential remedies for noncompliance including decertification and recapture of past awards.