Successfully accessing funding through the CDFI Bond Guarantee Program (BGP) involves more than just securing the capital—it’s equally important to comply with the program’s disbursement requirements. These guidelines ensure that funds are used responsibly and effectively to achieve the program's mission of supporting underserved communities.

Understanding BGP Disbursement Requirements

BGP disbursement requirements outline how the funds provided through the program must be distributed and used. These requirements include guidelines on how funds should be drawn down, how they can be allocated, and how often disbursements are allowed.

Key elements of the disbursement process include:

• Fund Allocation – The funds must be applied to eligible projects such as affordable housing, commercial development, or community facilities.

• Drawdown Timing – Funds are generally disbursed in stages, based on project milestones or capital needs.

• Tracking and Reporting – CDFIs must demonstrate progress and ensure funds are used per the approved project plan and CMF guidelines.

Ensuring Compliance

Meeting BGP disbursement requirements is crucial for staying in compliance with program rules. Failure to adhere to these guidelines can result in delayed disbursements, penalties, or even disqualification from future funding.

By adhering to BGP disbursement requirements, CDFIs can ensure that their funds are effectively managed, leading to successful project implementation and continued access to BGP resources.

Best Practices for Disbursement Compliance

• Track project expenses diligently and ensure alignment with project goals.

• Coordinate with financial advisors or program consultants to manage disbursement schedules.

• Report regularly on the usage of funds to ensure transparency and compliance.

1. What are BGP disbursement requirements?

They are the rules and procedures that govern how and when funds from the CDFI Bond Guarantee Program can be drawn down and used for eligible community development projects.

2. How often can funds be disbursed under the BGP?

Disbursements are typically made in tranches, based on milestones or documented need. The schedule is outlined in the disbursement agreement and must align with the approved use of funds.

3. What documentation is needed to request a disbursement?

CDFIs must provide project budgets, progress updates, and proof of eligible expenses to support each disbursement request.

4. Can BGP funds be redirected to a different project?

No. Funds must be used for the specific, pre-approved purposes outlined in the BGP agreement unless a formal amendment is approved by the program administrators.

5. Where can I get support with meeting BGP disbursement requirements?

You can find tools, templates, and expert help through technical assistance providers familiar with BGP disbursement requirements and CDFI Bond Guarantee compliance.