1559-0005_BEA Program Application_Supporting Statement

Supporting Statement for Paperwork Reduction Act Submissions

Community Development Financial Institutions Fund (CDFI Fund)

Bank Enterprise Award (BEA) Program Application, OMB 1559-0005

A. Justification

1. Circumstances necessitating collection of information

The Community Development Financial Institutions Fund (CDFI Fund) administers the Bank Enterprise Award (BEA) Program that awards insured depository institutions for increasing their support of CDFIs and their direct financing and service-related activities in economically distressed communities. The Application form and materials are used by applicants to apply for BEA Program awards. Applicants are required to complete and submit an application to the CDFI Fund to be considered for a BEA Program award.

2. Method of collection and use of data

The data collected via this form will be collected by voluntary submission once per funding round by insured depository institution applicants seeking BEA Program awards. The CDFI Fund uses data collected to evaluate the merits of individual applications and to determine BEA Program award amounts.

3. Use of Information Technology

The BEA Program application is available on Grants.gov. Grants.gov allows applicants to submit their applications electronically. In addition, the CDFI Fund has an online mapping system that allows applicants to geocode addresses and determine whether transactions occurred in BEA qualified distressed communities. The mapping system is simple to use and reduces the burden on applicants. The CDFI Fund also allows applicants to submit a list of all application materials electronically, which also reduces the burden on applicants and is a more efficient process.

4. Efforts to identify duplication

The BEA Program application does not request information that is publicly available from other Federal agencies other than the total asset size of the insured depository institution applicant.

5. Impact on small entities

This collection of information does not have a significant impact on small entities.

6. Consequences of less frequent collection and obstacles to burden reduction

The CDFI Fund is statutorily required to have an application process for making BEA Program awards. The CDFI Fund cannot meet its statutory requirement without an application that collects data from applicants. Required elements of the collection specified in the BEA Program Regulations limit the amount of burden that can be reduced.

7. Circumstances requiring special information collection

Not applicable.

8. Solicitation of comments on information collection

Comments on the BEA Program application were solicited in the Federal Register on December 23, 2014 (79 FR 77086). The CDFI Fund received seventeen responses. The majority of the responses were related to a proposed internal process change that respondents overwhelmingly opposed. As a result, the CDFI Fund has decided to postpone implementation of this internal process change to a later date that has not yet been determined. Respondents also expressed their support for the proposed program policy change and their understanding for the need to address new OMB Uniform Requirements. Three respondents also commented on the accuracy of the CDFI Fund’s burden estimates. The CDFI Fund updated its current burden estimate based on the average number of applications received in each of the past 3 years. It should also be noted that the CDFI Fund recently moved from a paper to a fully electronic application which significantly reduces applicant burden. Comments on other topics were also taken under advisement. A detailed summary of the comments and the CDFI Fund’s responses is included as Appendix I, Comment and Response Summary.

9. Provision of payment to respondents

No payments or gifts will be made to respondents.

10. Assurance of confidentiality

The CDFI Fund is subject to all Federal regulations with respect to the confidentiality of information provided in the BEA Program Application. No other assurances of confidentiality have been provided.

11. Justification of sensitive questions.

No personally identifiable information (PII) is collected.

12. Estimate of the hour of burden of information collection

Based on the average number of applications received in each of the past three years (Fiscal Years 2012-2014), the CDFI Fund anticipates 89 respondents to the application, with an estimated 44.4 hours per applicant. The total burden of this information collection is estimated at 3,952 hours.

13. Estimate total annual cost burden to respondents

There is no cost burden to applicants related to the collection of this data. No purchase of equipment or services will need to be made by applicants for this information collection other than as required as a part of customary and usual business practices.

14. Estimate of annualized cost to the Government

The cost to the Government is the CDFI Fund staff and contractor time required to develop the application, review submitted applications, collect follow-up information from applicants, and report the results.

15. Any program changes or adjustments

In response to feedback from the industry, the burden estimates were updated based on the analysis of actual applicant data from the last three years (Fiscal Years 2012 – 2014).  The analysis focused on two factors: (1) applicant reported burden in the application; and (2) the actual increase in applicants from 75 to 89.  Therefore, the increase of 14 responses and 2,827 burden hours is an adjustment reflected in the total burden requested of 3,952 hours.

16. Plans for information tabulation and publication

Confidential or proprietary information collected through the application will not be published.

17. Reasons for not displaying expiration date of OMB approval

The CDFI Fund’s requests not to display the OMB expiration date on the current application because the specific application period, as identified in the NOFA, may cause confusion on when the application is due.

18. Explanation of exception to certification statement

Not applicable.

B. Collections of Information Employing Statistical Methods

This section is not applicable.

Comment Date	Author Name	Author Position	Organization	File Name	Category	Comment	BEA Program Office Response
1/23/2015	Holly Logue		McKay Lawler Franklin & Foreman, PLLC	20150123 - Holly Logue - McKay Lawler Franklin Foreman PLLC	Internal Process Change: Baseline/Assessment Period	Concerned that the proposed requirement that applicants use their 2014 Assessment Period amount as their 2015 Baseline Period Amounts would negatively impact applicants that applied in 2014 using legacy eligibility data by making it more difficult to demonstrate an increase in activities in their 2015 application using the updated ACS data to determine Assessment Period activity levels.	Postponed this requirement
1/23/2015	Holly Logue		McKay Lawler Franklin & Foreman, PLLC	20150123 - Holly Logue - McKay Lawler Franklin Foreman PLLC	Program Policy: New Activity Type - Small Dollar Consumer Loans	Recommended a ceiling of $5,000 for New Activity Type - Small Dollar Consumer Loans	Adopted recommendation
1/26/2015	Myra Dunlap	Senior Vice President	Guaranty Bank	20150126 - Myra Dunlap - Guaranty Bank and Trust Company	Internal Process Change: Baseline/Assessment Period	Concerned that the proposed requirement that Applicants use their 2014 Assessment Period amount as their 2015 Baseline Period amounts would advantage new Applicants, adversely impact Applicants that planned to increase lending in previously eligible distressed communities, and discourage serving new areas.	Postponed this requirement
1/27/2015	Colette Loesher	President/CEO	ABC Bank	20150127 - Colette Loesher - ABC Bank	Internal Process Change - Baseline/Assessment Period	Concerned that the proposed requirement that Applicants use their 2014 Assessment Period amount as their 2015 Baseline Period amounts would advantage new Applicants, adversely impact Applicants that planned to increase lending in previously eligible distressed communities, and discourage serving new areas.	Postponed this requirement
1/27/2015	Joel Horton	President	RiverHills Bank	20150127 - Joel Horton - RiverHills Bank	Internal Process Change - Baseline/Assessment Period	Concerned that the proposed requirement that Applicants use their 2014 Assessment Period amount as their 2015 Baseline Period amounts would advantage new Applicants, adversely impact Applicants that planned to increase lending in previously eligible distressed communities, and discourage serving new areas.	Postponed this requirement
1/27/2015	William Dana Jr.	President/ CEO	Central Bank of Kansas City	20150127 - William Dana Jr - Central Bank of Kansas City	Internal Process Change: Baseline/Assessment Period	Concerned that the proposed requirement that Applicants use their 2014 Assessment Period amount as their 2015 Baseline Period amounts would advantage new Applicants, adversely impact Applicants that planned to increase lending in previously eligible distressed communities, and discourage serving new areas.	Postponed this requirement
1/28/2015	Sylvia Chung	Executive Vice President/ CFO	Pacific Global Bank	20150128 - Sylvia Chung - Pacific Global Bank	Internal Process Change: Baseline/Assessment Period	Concerned that the proposed requirement that Applicants use their 2014 Assessment Period amount as their 2015 Baseline Period amounts would advantage new Applicants, adversely impact Applicants that planned to increase lending in previously eligible distressed communities, and discourage serving new areas.	Postponed this requirement
1/29/2015	Jeannine Jacokes		Community Development Bankers Association	20150129 - Jeanine Jacokes - Community Development Bankers Association	OMB Uniform Requirements: Projected Use of BEA Program Award	Recommend that the CDFI Fund allow maximum flexibility with this requirement given that award size is uncertain and to allow applicants to amend their forecast when they receive notification of their award. Recommends that this requirement be treated only as an estimate with no penalties or restrictions on amending it post award notice.	Adopted recommendation
1/29/2015	Jeannine Jacokes		Community Development Bankers Association	20150129 - Jeanine Jacokes - Community Development Bankers Association	Internal Process Change - Baseline/Assessment Period	Concerned that the proposed requirement that applicants use their 2014 Assessment Period amount as their 2015 Baseline Period amounts would create unintended consequences and inequities in the applicant pool. Insufficient advanced notice regarding this change is problematic as banks were not aware of the change prior to planning their loans and investments. Recommends postponing implementation.	Postponed this requirement
1/29/2015	Jeannine Jacokes		Community Development Bankers Association	20150129 - Jeanine Jacokes - Community Development Bankers Association	Program Policy: New Activity Type - Small Dollar Consumer Loans	Pleased that the addition of this activity will help banks continue to provide these products in the future. Recommended that the CDFI Fund provide flexibility in defining this product to account for differences amongst applicants. Also recommends: (1) that the CDFI Fund allows community services used to promote financial literacy be reported and ranked as a distressed community financing activity and not a service activity: and (2) that auto loans be adopted as an eligible BEA activity.	Adopted recommendation that the definition of Small Dollar Loans by flexible to account for difference amongst applicants.
1/29/2015	Jeannine Jacokes		Community Development Bankers Association	20150129 - Jeanine Jacokes - Community Development Bankers Association	Burden	The CDFI Fund's BEA application burden estimates are incorrect. The CDFI Fund can minimize burden by: (1) enhancements to the CDFI Fund's geocoding system; and (2) adopting eligible activity definitions that align with reporting categories required for Call Reports.	The CDFI Fund has revised the burden estimates based on an analysis of the most recent data.
1/29/2015	Max Yates	Senior Executive Vice President and Chief Risk Officer	Bank Plus	20150129 - Max Yates - BankPlus	Internal Process Change: Baseline/Assessment Period	Concerned that the proposed requirement that Applicants use their 2014 Assessment Period amount as their 2015 Baseline Period amounts would advantage new Applicants, adversely impact Applicants that planned to increase lending in previously eligible distressed communities, and discourage serving new areas.	Postponed this requirement
2/2/2015	Faruk Daudbasic	Vice President	First Eagle Bank	20150202 - Faruk Daudbasic - First Eagle Bank	Internal Process Change: Baseline/Assessment Period	Concerned that the proposed requirement that Applicants use their 2014 Assessment Period amount as their 2015 Baseline Period amounts would advantage new Applicants, adversely impact Applicants that planned to increase lending in previously eligible distressed communities, and discourage serving new areas.	Postponed this requirement
2/2/2015	Robert Earl James, II		Carver State Bank	20150202 - Robert Earl James II - Carver State Bank	Internal Process Change: Baseline/Assessment Period	Concerned that the proposed requirement that Applicants use their 2014 Assessment Period amount as their 2015 Baseline Period amounts would advantage new Applicants, adversely impact Applicants that planned to increase lending in previously eligible distressed communities, and discourage serving new areas.	Postponed this requirement
2/3/2015	Buddy Mortimer	President/ CEO	Bank of Kilmichael	20150203 - Buddy Mortimer - Bank of Kilmichael	Internal Process Change: Baseline/Assessment Period	Concerned that the proposed requirement that Applicants use their 2014 Assessment Period amount as their 2015 Baseline Period amounts would advantage new Applicants, adversely impact Applicants that planned to increase lending in previously eligible distressed communities, and discourage serving new areas.	Postponed this requirement
2/3/2015	Connie Hawkins	CFO	First Security Bank and Security Capital Corporation	20150203 - Connie Hawkins - First Security Bank and Security Capital Corporation	Internal Process Change - Baseline/Assessment Period	Concerned that the proposed requirement that Applicants use their 2014 Assessment Period amount as their 2015 Baseline Period amounts would advantage new Applicants, adversely impact Applicants that planned to increase lending in previously eligible distressed communities, and discourage serving new areas.	Postponed this requirement
2/3/2015	Dawn Reiff	President	Community Funding Advisors	20150203 - Dawn Reiff - Community Funding Advisors	Internal Process Change - Baseline/Assessment Period	Concerned that the proposed requirement that Applicants use their 2014 Assessment Period amount as their 2015 Baseline Period amounts will have unintended consequences such as: (1) Baseline Periods for 2015 will not accurately reflect activity levels resulting in inaccurate Applications; and (2) additional effort for those that applied in 2014 as a result of having to determine the eligibility of transactions made under old data against the new data.	Postponed this requirement
2/3/2015	Dawn Reiff	President	Community Funding Advisors	20150203 - Dawn Reiff - Community Funding Advisors	Program Policy: New Activity Type - Small Dollar Consumer Loans	Recommended that the CDFI Fund provide flexibility in defining the small dollar consumer loan poduct to account for differences amongst applicants.	Adopted recommendation
2/3/2015	Dawn Reiff	President	Community Funding Advisors	20150203 - Dawn Reiff - Community Funding Advisors	OMB Uniform Requirements: Projected Use of BEA Program Award	Not sure what the intent of this requirement is. Claimed that it is difficult for applicants to project without knowing the award amount or what the market conditions will be. Concerned that failing to meet projections will have a negative impact on an organizations standing with the CDFI Fund.	This change is mandated by the OMB Uniform Requirements for all Federal grant award Recipients. Recipients will be allowed to modify its projected use of its BEA Program Award in its Award Agreement.
2/3/2015	Ruth Barber & Lolita Sereleas	Partner and Founding Partner	Fund Consulting	20150203 - Ruth Barber and Lolita Sereleas - Fund Consulting	Internal Process Change - Baseline/Assessment Period	Concerned that the proposed requirement that applicants use their 2014 Assessment Period amount as their 2015 Baseline Period amounts would advantage new applicants, adversely impact applicants that planned to increase lending in previously eligible distressed communities, and discourage serving new areas. Recommends implementing this requirement in 2016 and allowing for CDFI Banks to add new Distressed Communities year to year.	Postponed this requirement
2/3/2015	Ruth Barber & Lolita Sereleas	Partner and Founding Partner	Fund Consulting	20150203 - Ruth Barber and Lolita Sereleas - Fund Consulting	Program Policy: New Activity Type - Small Dollar Consumer Loans	Commends the CDFI Fund's addition of small dollar consumer loans as an eligible activity type.	Adopted recommendation
2/3/2015	Ruth Barber & Lolita Sereleas	Partner and Founding Partner	Fund Consulting	2015.2.3 - Fund Consulting - 2015 BEA Application	Other	Recommends the following enhancements to the application process: (1) consider reinstituting the mapping requirement for all applicants; (2) consider requesting loan documentation only from applicants whose applications are determined to have eligible activities and are being considered for an award; (3) consider requiring detailed baseline activity, similar to the assessment period.	The CDFI Fund is taking all comments under advisement.
2/3/2015	Ruth Barber & Lolita Sereleas	Partner and Founding Partner	Fund Consulting	20150203 - Ruth Barber and Lolita Sereleas - Fund Consulting	Burden	The CDFI Fund's BEA application burden estimates are incorrect. Although it may take 15 hours to complete the application itself there is between 45-75 hours of time spent collecting and confirming information.	The CDFI Fund has revised the burden estimates based on an analysis of applicant reported burden over the past 3 years.
2/4/2015	Andy Salk	President	First Eagle Bank	20150204 - Andy Salk - First Eagle Bank	Internal Process Change: Baseline/Assessment Period	Concerned that the proposed requirement that Applicants use their 2014 Assessment Period amount as their 2015 Baseline Period amounts would advantage new Applicants, adversely impact Applicants that planned to increase lending in previously eligible distressed communities, and discourage serving new areas.	Postponed this requirement
2/17/2015	Frank Cerrone	President/ Co-CEO	Pan American Bank	20150217 - Frank Cerrone - Pan American Bank	Internal Process Change - Baseline/Assessment Period	Concerned that the proposed requirement that Applicants use their 2014 Assessment Period amount as their 2015 Baseline Period amounts would advantage new Applicants, adversely impact Applicants that planned to increase lending in previously eligible distressed communities, and discourage serving new areas.	Postponed this requirement
2/23/2015	Kristin Faust	President	Neighborhood Housing Services of Chicago, Inc.	20150223 - Kristin Faust - Neighborhood Housing Services of Chicago	Burden	This CDFI Partner expressed concern that the Application and reporting requirement burden is currently too high and that it is too costly for local community banks to apply.	The CDFI Fund has revised the burden estimates based on an analysis of the most recent data.

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