WASHINGTON, May 11, 2022 — A Treasury Department program that provides capital to disadvantaged communities is helping invest in building broadband infrastructure in rural America, some of those recipient institutions said at a Tuesday event.
The department awards grants and certifies institutions such as banks, credit unions, loan funds, microcredit funds, or venture capital providers as community development financial institutions that provide financial services in low-income communities and people who do not have access to finance. , according to the government website.
The program also helps build much-needed broadband connectivity, as seen in rural Wyoming, where the Midwest Minnesota Community Development Corporation has previously used CDFI funds to fund a project to manage fiber optic networks in rural Wyoming.
“We believe there is capital available for rural broadband,” Gary Frankchief executive of CoBank’s communications group, said at the Local Initiative Support Corporation event on Tuesday.
LISC is an intermediary non-profit association that connects public and private resources with underinvested places. CoBank, however, is not a CDFI.
Such deals “will typically involve partnerships with state, local or federal programs in addition to private equity,” he said.
Suzanne AnardeCEO of Rural Community Assistance Corporation, a CDFI, said Tuesday that CDFIs need to “discover what our individual niche is and how we can build the capabilities that make us viable.”
Brian Vochief investment officer at Connect Humanity, said his organization may work with CDFIs in the future to fund their holistic approach to digital equity.
LISC alleges that major national financial institutions are not interested in making investments to improve the expansion of rural broadband across the country. The organization states on its website that “rural broadband is lacking in many areas because large national providers are not interested in investing”.
“We see a lot of opportunities there. With the right capital and the right funding programs, there’s a lot more to come,” Franke said.
There are currently over 1,200 CDFI funds operating across the country, many of which are now focused on bridging the digital divide by providing funds for rural broadband infrastructure.