The Community Investment Program (CIP) is designed to encourage member financial institutions throughout Kentucky, Ohio and Tennessee to increase their involvement in housing and community-based economic development and revitalization activities in the communities they serve.
The CIP provides a discount off regular advance programs to encourage and assist member financial institutions in providing favorable financing terms for eligible community investment activities.
Use of Funds and Qualifying Activities
The CIP is designed to finance the acquisition, construction or rehabilitation of owner-occupied and rental housing for families with incomes at or below 115 percent of
area median (pdf).
The CIP also provides financing for community economic development, commercial/industrial, and small business activities located in specifically defined areas:
·
A neighborhood with a median income at or below 80 percent of area median income;
·
A Champion Community, or an Empowerment Zone or Enterprise Community, as designated by USDA or HUD;
·
An Indian area, as defined by the Native American Housing Assistance and Self-Determination Act of 1996, Alaskan Native Village, or Native Hawaiian Home Land.
The CIP also provides financing for projects which meet one of the following criteria:
·
The annual salaries of at least 51 percent of the jobs created or retained are at or below 80 percent of area median income; or
·
At least 51 percent of the families who otherwise benefit are at or below 115 percent or area median income.
Funds Availability
CIP advances are priced daily at the FHLBank's cost of funds plus administrative costs. CIP advances are available daily and are processed within two business days from receipt of application.
Eligible Advances Types
All fixed-rate, mortgage-related advances with a term of one year or greater are eligible. Convertible Fixed Rate and Repo advances are not eligible for the CIP.
Limitations
Member institutions may borrow CIP funds in an amount equal to 25 percent of total advances outstanding with the FHLBank at time of drawdown of funds, or $50 million in CIP advances on an annual basis, whichever is less.
Terms, Fees and Conditions
CIP advances are made available to eligible financial institutions on a secured basis only and are subject to the normal underwriting and collateral policies of the FHLBank.
Application Guidelines
Member institutions applying for CIP advances should complete and submit a
CIP application form (pdf) that describes the eligible activity for which the funds will be used to the Housing & Community Investment Department which assigns the discount. After qualification, the funding becomes a regular credit transaction that requires completion of an Advances Application Agreement submitted to the Credit Department. Funds are disbursed into the member's DDA account with the FHLBank.
Reporting
Financial institutions receiving CIP funds will be required to identify a contact person and to submit an annual letter outlining the status of the CIP eligible activities.
For information and technical assistance, please contact the Housing
and Community Investment Department at (888) 345-2246.
