The NEXT American Opportunity: Good Policies for a Great America offers more than 200 concrete, specific recommendations for federal policy. Each chapter identifies the policy solutions that are most actionable, practical, and timely and spotlights the policy changes that could create the greatest economic value.

The project contains many suggestions to promote an inclusive prosperity while recognizing that federal resources are scarce; our nation cannot afford to waste these valuable resources on ideas that do not work. CDFIs are proven to be a good investment and an effective lever for federal support. No other federal spending does more to leverage private capital into markets and communities that are underserved or otherwise outside the economic mainstream.

Limited resources in the face of increasing opportunities to close the wealth and income gaps make this a critical time for domestic policy. The NEXT American Opportunity contains sound, responsible suggestions that, with a small federal investment, could change the lives of millions of Americans and the communities in which they live. Because of the sheer number of recommendations included, Opportunity Finance Network and its Members have vetted the suggestions and recommend the following as our top policy priorities, the best ways that federal support can be leveraged for our nation’s most in need.

The Community Development Financial Institutions Fund (CDFI Fund) in the U.S. Department of the Treasury. The CDFI Fund invests in organizations with sound strategies, making awards through a competitive assessment of strategic business plans. The CDFI Fund meets the opportunity finance industry's needs for equity capital and for investment in institutional capacity building. It supports permanent institutions with specialized market knowledge and expertise, and is the only federal source of equity capital available to all CDFIs, regardless of location or lending sector. It is a unique, proven program.

• Support increased funding for the CDFI Fund. It is strongly recommended that the CDFI Fund receive a minimum of $250 million per year.

New Capital Opportunities. In the changing political landscape, there is a rare opportunity to develop, propose, and enact policies that would simultaneously reflect the structural and systemic changes of our industry and define the next generation of our work. These policies would result in substantially more capital flowing through CDFIs and other opportunity finance institutions, and would involve fundamental changes in the structures and systems by which that capital moves.

• Make CDFIs eligible applicants for all federal community development grant and loan programs.
• Within the CDFI Fund, a research and development program should be established. This "innovation bank" would function as a new source for product creation and system change to lead promising ideas and products to scale. The opportunity finance industry has been the leader for sustainable innovation for our nation's poorest communities for decades, but it has the potential to facilitate even greater levels of change. It is time to put resources into research and development for CDFIs.

Government-Sponsored Enterprises (GSEs). Fannie Mae, Freddie Mac, and the Federal Home Loan Bank System have affirmative obligations to improve housing opportunities for low- and moderate-income people. As government-sponsored entities, their support of homeownership and affordable rental housing helps government fulfill its role in expanding inclusivity and building assets.

• Establish a community economic development fund within the FHLB System, analogous to the Affordable Housing Program (AHP) by modifying the FHLBs' RefCorp payment obligation.
• Give the GSEs extra credit toward meeting their affordable housing responsibilities for purchasing mortgages on properties that are energy efficient or otherwise environmentally responsible.

A Strong and Well-Enforced Community Reinvestment Act (CRA). The CRA is an example of the government's role in exposing and correcting market imperfections. A strong CRA helps fulfill the government's role in growing the economy and enhancing markets. The CRA has led banks to discover profitable but overlooked markets, channeling billions of dollars over the last 30 years into market-ready but undeployed assets. It has helped sustain these markets by fostering partnerships between banks and CDFIs.

• A positive obligation to serve low-income communities and people should be extended to all portions of the financial services industry that compete with banks and thrifts through the CRA. This includes not only credit unions and mortgage bankers but also other entities that provide credit, transaction services, and savings and investment vehicles. Evaluations should include holding companies and all affiliates.

The New Markets Tax Credit (NMTC). Passed with overwhelming bipartisan support in 2000, the New Markets Tax Credit is the largest federal economic development initiative to be launched in 20 years. The NMTC delivers capital to underutilized markets, facilitating a government role in improving markets and expanding inclusiveness.

• Congress should make the NMTC permanent. Congress has extended the credit one year at a time since 2006. Although these one-year extensions are helpful, the lack of long-term availability of the credit makes it extremely difficult for organizations and developers to plan; making the NMTC permanent would help alleviate this problem. Statutory changes that eliminate structural disadvantages faced by certified CDFIs should be made part of the permanent legislation.

Curbing Predatory Lending. Predatory lending is a real and present danger, not only to low-income and low-wealth people and communities but also to our nation’s economy. The Information imbalances that make people victims of predatory lending are indicative of a market failure, and abusive lending magnifies that imperfection. As long as consumers lose rather than gain assets, they cannot be full participants in the economic mainstream.

• Congress should impose minimum federal standards on which states can build. It should promote strong legislation and regulations to prevent predatory lending. In recent years, state laws have helped rein in lending abuses. States have the ability to respond to local issues and changing market conditions. Any federal law that would weaken states’ predatory lending statutes must be defeated.