"It has been a godsend to learn that there are people looking out for us,” said Executive Director Alice Mulligan of Our Savior's Lutheran Preschool, located in the Bay Ridge, Brooklyn neighborhood of New York City. “We are so used to being on the other end of the line looking out for others.”
When the pandemic hit the school and its childcare services hard, the Low Income Investment Fund (LIIF) assisted with the intricacies of Paycheck Protection Program (PPP) loan application that provided federal funding to help keep workforces paid and employed during the COVID-19 crisis. The unprecedented challenges of that time catalyzed LIIF’s scaling of its national childcare business model.
For over two decades, Mizuho has strategically partnered with this social-impact organization to help achieve its stated goals around revitalizing communities, the environment, sustainable finance and education. With a $20 million debt investment and additional grant support, Mizuho is helping to leverage LIIF’s community development lending platform, with its funding tailored to under-resourced communities in the five boroughs of New York City.
These important investments have funded critically needed loans to expand affordable housing, charter schools, and early care and education (ECE) facilities, which all provide local community services, stimulate economic growth and create jobs.
"LIIF is only as strong as its partners who believe in our mission and our work and are as committed to community investment as we are," explains LIIF Chief Executive Officer Daniel A. Nissenbaum. "That commitment comes from Mizuho’s understanding of the importance of supporting all income levels in the community, where their employees, partners and other stakeholders live and work."
CDFIs as Drivers of Investments
With the historic passage of the Riegle Community Development and Regulatory Improvement Act of 1994, the foundation was laid for the creation of Community Development Financial Institutions (CDFIs) by the U.S. Treasury, via the CDFI Fund. Since then, the Fund and its programs have been a powerful force for change, driving economic opportunity in communities too often left behind. There are now almost 1,500 CDFIs across the country, including loan funds such as LIIF, banks, credit unions and venture funds. The industry holds an impressive $452 billion in total assets as of Q1/23. (Learn more about how CDFIs propel the U.S. economy.)
As one of the nation's largest and most successful CDFIs, LIIF has served as an intermediary for Mizuho to disburse flexible, patient capital to local communities where it is located, as the organization has done for many others through its 40 years in operation. Over those four decades, LIIF has best positioned itself to weather economic uncertainties such as interest-rate fluctuations, recessions, inflationary periods and even a pandemic, with strength, stability and impact evidenced by its S&P investment grade rating. The numbers tell the story: LIIF has invested more than $3.5 billion to serve 2.5 million people in 32 states. This is an enviable track record of success for an organization now scaled to 160 employees strong in five offices across the country.
Spotlight on Child Care
Mizuho's early grant support was impactful in helping LIIF grow its ECE work. LIIF is now the leading national CDFI working in the early care and education (ECE) sector, having invested over half a billion dollars to positively impact 400,000+ children's spaces. In the words of one provider, "LIIF is a key for change in every state that looks at the needs of the ECE community and families.”
The child care emergency in this nation is well documented and, with federal pandemic-relief funds expiring, there are 3.2 million children who could lose their spaces. That is why LIIF is currently advocating for policy change that fosters racial equity, promoting the creation of a federal child care facilities fund offering grants and low-interest loans. LIIF sees this as a bipartisan issue, as it drives small-business development and allows more families to rejoin the workforce. It comes down to macroeconomics: The nation experienced a dearth of workers to fill jobs post-pandemic, with lack of accessible, affordable child are often cited as a factor. Child care, coupled with housing, are the two largest monthly bills for households, with low-income families feeling the pinch more than anyone. A Council for a Strong America article evidenced that there is a $122 billion annual economic loss to the nation due to a paucity of child care options for families.
To hit this challenge head on, LIIF has created a program to serve local governments with fund management/distribution to help upgrade child care facilities via grant disbursement. In addition, LIIF provides advisory and consulting services to a range of clients to help develop child care supports.
“Mizuho has been a wonderful – and constant – partner for LIIF in this work, allowing us to drive forward our mission that 'everyone in the United States should benefit from living in a community of opportunity, equity and well-being,'" concludes Nissenbaum.
Are you interested in partnering with LIIF via lending or providing grants to support the organization's work? Please contact Christopher Gil [email protected].