As President Biden approaches his 100th day in office, one of the campaign promises looming over his presidency is this: ensuring underserved and low-income communities are at the forefront of any economic recovery.

It’s a conversation that he’s had in public and behind closed doors with high-level administration officials, particularly Vice President Kamala Harris. Funds that could help put that goal within reach could start going out in June, according to a Treasury Department official. 

“The vice president’s been just tremendously focused on American small businesses,” a senior White House official said, with a focus on the role of community lenders.

Community Development Financial Institutions (CDFIs) make up the thousands of community lenders throughout the country that provide capital to the small businesses that have trouble obtaining loans from big banks. The pandemic disproportionately hit minority- and women-owned businesses, and studies have found business owners of color faced greater challenges getting loans, even when they posed a low credit risk.

CHICAGO, IL – APRIL 06: Vice President Kamala Harris makes a stop at Brown Sugar Bakery on Chicago’s Southside with Cook County State’s Attorney Kim Foxx and Illinois Lt. Governor Juliana Stratton on Tuesday, April 6, 2021 in Chicago, IL. 

Kent Nishimura / Los Angeles Times via Getty Images

Associate Small Business Administrator for Capital Access Patrick Kelley referred in a statement to CDFIs as “trusted agents” that “play a critical role in lending to underserved communities.”

“[W]e want to maintain that continued strong partnership under the Biden-Harris Administration,” Kelley said in a statement. “We have been working with CDFIs to redouble our efforts to assist eligible borrowers in these communities and ensure small businesses in communities of color and underserved communities can better access the PPP and other COVID-19 emergency assistance programs. “

“It was one of the first issues the vice president raised with me after she swore me in – the importance of Community Development Financial Institutions and Minority Depository Institutions (MDIs),” Treasury Secretary Janet Yellen said in a statement to CBS News. 

Yellen, observing that the racial wealth gap has remained the same since the 1960s, added, “The Vice President understands deeply that if we want to change that very unjust number – and create an economy that works for everyone – then we need to inject capital into communities that, historically, haven’t had access to it so people can buy homes and start small businesses.”

When the pandemic struck, only 43% of Black business owners received all the Paycheck Protection Program funding they sought, the lowest share of any group, according to a study by the Federal Reserve. One in five Black-owned businesses that applied for PPP received nothing, a higher proportion than any other group.

In December 2020, Congress passed a second COVID relief bill, which included $12 billion in funding for CDFIs and MDIs. This consisted of $9 billion of indirect capital investments to financial institutions, with the remaining $3 billion providing two pots of grant money.  The first tranche of $1.25 billion for rapid-response relief will be disbursed first, and the second tranche of $1.75 billion will go into a minority lending program. A Treasury Department official says the rapid-response money will be distributed no later than the end of June.

Harris, who was still a California senator during this period, signed on early to a bill by Senator Mark Warner, a Democrat from Virginia, that provided the blueprint for eventual funding for community lenders.   

“My two biggest supporters on this were [former Treasury Secretary] Steve Mnuchin and Kamala Harris,” Warner said in a phone interview with CBS News. “She completely understands the challenges that go with most of the Black and Brown communities. We lost 440,000 Black businesses, the majority of which were sole proprietors, and they didn’t get as much access to PPP because African Americans didn’t have traditional banking relationships. So, she did her due diligence and became a big advocate as we were then trying to take it from the bill during the summer to actually getting it in [the COVID-19 Relief Bill].”

According to White House and Treasury Department officials, the staffs of both the vice president and the treasury secretary have remained in close contact on this issue and also held two formal meetings to ensure funds would be allocated to communities that need them most. 

The first, a public event in early February, also included participants from local Black chambers of commerce throughout the country. A second private engagement was held in the vice president’s West Wing office in late March. During that meeting, both staffs discussed the implementation of the $12 billion appropriated by Congress in December.

Working alongside the Treasury Department, the vice president and her staff have also been speaking with various CDFIs.

“We started hearing from this administration in the transition. We were called by Janet Yellen and the Deputy Secretary Wally Adeyemo to brief them — before they took office even — to explain what was happening with current PPP loans,” said Lisa Mensah President and CEO of Opportunity Finance Network, a network of more than 300 member CDFIs with nearly $27 billion in assets. The vice president’s staff has also reached out. “We feel like part of the promise of this administration is that they hit the ground running with a very sensitive ear to the double burden of rebuilding, but rebuilding in a way that was sensitive to how we were going to actually implement racial healing,” Mensah said.

As the administration continues to figure out how the grants and investments will be distributed, Harris is pressing small businesses to apply. 

“The vice president, for her part, has been really focused, at this stage, on making sure that the biggest, best applicant pool possible is out there, putting their best foot forward in terms of being seen as competitive applicants for these funds,” a senior White House official said. 

Some heads of CDFIs stress that time is of the essence. “Dollars that have already been approved by the Congress, those dollars need to flow quickly,” said Brad McConnell, CEO of Allies for Community Business, a non-profit CDFI focused primarily on businesses serving underrepresented areas of Illinois and Indiana. “We’re really encouraged that all signs are that they are, in fact, going to flow quickly. We just don’t know exactly by what date quite yet, but the signs are positive on that.”

Harris has also been seeking help from the private sector to bring wealth and opportunity into underserved communities.

According to a White House official, the vice president has had phone calls with Bank of America CEO Brian Moynihan and JPMorgan Chase CEO Jamie Dimon.

A spokesperson for JPMorgan Chase said, “We appreciate the opportunity to continue to engage with the Vice President and her office about PPP lending and the importance of community lending and to discuss best practices.”

Bill Bynum, the CEO of Hope Enterprise Corporation, an organization that has invested $2.9 billion in rural areas in the South, said he, too, has heard from Harris. 

“In my conversations with Vice President Harris, she made it very clear that she is looking for ways to make sure that the infrastructure resources that the administration is prioritizing addresses this in the most vulnerable communities, including those like Mississippi Delta and Alabama Black Belt,” Bynum said. “We talked a good bit about CDFIs ability to leverage private capital from banks that have not served these areas. But CDFIs are very effective in partnering with major banks, with philanthropy, with corporations, as a way to import investment into places where wealth has been extracted for generations.”