American Indian CDFI Gets $1 Million to Help Finance Tribal Lands
Jun 15, 2012
ILCC provided the Yurok Tribe of California with $2 million to buy watershed land from a timber company; it will now be sustainably managed.
Indian Land Capital Company, an American Indian Community Development Financial Institution (CDFI) that specializes in financing tribal lands, has received a $1 million low-cost loan from Bank of America to finance local economic development programs. The seven-year investment will enable ILCC to help Indian nations in the western and southwestern U.S. acquire lands for business development, housing and community-based projects.
Limited financing available for the purchase of tribal lands is one of the biggest barriers for Indian nations that want to pursue economic development opportunities and community-based projects on reservation land. Many conventional financial institutions are not familiar with financing for trust land and shy away from land acquisition lending to Indian nations, regardless of the tribe's financial position or track record. ILCC was established in 2005 to fill this gap in lending.
ILCC, headquartered in Roscoe, Montana, is a certified Native CDFI that provides alternative loan options to Indian nations to acquire their tribal lands. Unlike traditional lending institutions, ILCC takes into consideration the unique financial needs of Indian nations, and as a Native-run business, recognizes the importance of land to Indian people. ILCC offers term loans, and lines of credit or bridge loans, to Indian nations seeking financing. ILCC provides its loans based on the "full faith and credit" of the tribe, basing its decision on each tribe's financial condition, borrowing track record and ability to make loan payments; it does not require the land to be used as collateral.
Since it started, ILCC has made approximately $5.7 million in loans to Indian nations, and has assisted in the recovery of nearly 30,000 acres of tribal land. Projects made possible through ILCC include expansion of a health care facility, construction of homes for tribal members, sustainable forest management, wetland restoration and protection of sacred and cultural sites. For example, in 2010 and 2011, ILCC provided the Yurok Tribe in California with $2 million in financing toward the purchase of 27,737 acres of land in the Klamath watershed. The land, which had been owned by a timber company, is now part of the Yurok Tribal Community Forest and will be sustainably managed to protect its natural and cultural resources.
Bank of America partners with CDFIs like ILCC to provide low-cost capital, liquidity and technical assistance to provide economic development in traditionally underserved neighborhoods and regions. The bank is the top investor in CDFIs, with more than $1 billion in capital in more than 200 CDFIs, helping finance affordable housing, community facilities, nonprofits, small businesses and micro-enterprises.
"As the largest investor in CDFIs, we understand the value of leveraging these partnerships as an efficient way to provide financing, liquidity and technical assistance to support economic development programs in traditionally underserved communities," said Bank of America CDFI Executive Dan Letendre. "We recognize ILCC for continuing to focus on developing solutions to direct much-needed financing to Indian nations."
ILCC's long-term goal is to substantially increase its loan pool and its capacity to make more loans and larger loans. In 2011, ILCC launched a campaign to raise $4 million in the first year, with the goal of building a $100 million investment fund for Indian Country over the next 10 years.
"Through our partnership, Bank of America continues its commitment to Indian Country and belief in the ability of Indian people to determine their own futures," said Gerald Sherman, ILCC's president. "I commend Bank of America for their leadership in this area, and I hope other major financial institutions will recognize both the need and the opportunity of investing in Indian Country and will follow suit."
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