I. About Create Jobs for USA
What is Create Jobs for USA?
Create Jobs for USA (createjobsforusa.org) is a philanthropic initiative created through a partnership between Starbucks and Opportunity Finance Network® (OFN).This unprecedented initiative aims to mobilize individuals and institutions to address the nation's unemployment problem. It supports job creation and retention by providing capital grants to community development financial institutions (CDFIs) that lend to Community Businesses.
What is a Community Business?
Community Businesses include an array of commercial activity that create and preserve jobs in low-income, low-wealth, and other disadvantaged communities. Community Businesses include small businesses, microenterprises, nonprofit organizations (such as charter schools, day care, and senior centers), commercial real estate, and affordable housing.
What are Community Development Financial Institutions?
Community Development Financial Institutions (CDFIs) are private financial institutions that are 100 percent dedicated to delivering responsible, affordable lending to help low-income, low-wealth, and other disadvantaged people and communities join the economic mainstream. By financing community businesses CDFIs spark job growth and retention in hard-to serve markets across the nation.
What is the Create Jobs for USA Fund?
The Create Jobs for USA Fund was formed to mobilize donations from individuals, corporations, and other institutions to provide capital grants to nonprofit CDFIs. The Create Jobs for USA Fund is housed within OFN.
The Starbucks Foundation seeded the Fund with a $5 million donation, and the Fund grows through contributions made by individuals and corporations online at createjobsforusa.org or directly to OFN. Donors who contribute $5 or more to the initiative receive an “Indivisible” campaign wristband.
How will the donations be used?
Donations (less credit card pocessing fees) will go to CDFIs as capital grants to support increased lending to Community Businesses to assist in job creation and preservation.
Where are the Create Jobs for USA wristbands made?
One hundred percent of the materials are from right here in the U.S.A. The red, white and blue cord is manufactured in Rhode Island, and the brass crimps come from Florida. The zinc alloy bead is made in a woman-owned manufacturing plant in Los Angeles where the wristband is also being assembled.
How can I participate in Create Jobs for USA?
There are many ways that you can help address the current job crisis in the country and contribute to job creation through the Create Jobs for USA initiative. You can:
Make a donation and receive a wristband for yourself, your family, or your employees.
Organize a creative fundraiser that will draw attention to Create Jobs for USA, while raising money for new capital grants. This might include a fundraiser at your school, running in a 5K race, or organizing an eBay charity auction. Online tools like wishes.causes.com and ebaygivingworks.com make it easy.
Share your ideas on how communities can come together to help the current job crisis, or stories of inspiration or hope that might help a neighbor get back on their feet, on our Create Jobs for USA Facebook page. We want to bring together a community of people who are excited to help one another and get involved.
Follow us on Twitter for inspiring updates on Create Jobs for USA success stories, news about related programs, and information about CDFIs.
What are the award amounts?
The minimum capital grant is $20,000. We expect the maximum to be $500,000. In addition to the CDFI’s asset size, the capital grant amount is largely dependent on donations received each month.
How are specific award amounts determined?
For most CDFIs, award amounts are based on the CDFI’s asset size. For CDFIs whose loan portfolio outstanding includes 25 percent or less community business loans (as measured by dollar volume), award amounts will be determined on a case by case basis taking into account the applicant’s dollar volume of community business loans outstanding rather than their total asset size.
The amount of donations and number of award applications received each month are also factors in determining the award amounts.
How can a CDFI apply to the Create Jobs for USA Fund?
More than 110 CDFIs are Create Jobs for USA Awardees who have received a capital grant to support their loans to community businesses. OFN is no longer accepting new applications for the program. OFN will award all donations received in the future to the existing Create Jobs for USA Awardees to expand their community business lending which results in new jobs in communities throughout the U.S..
What are the conditions for Awardees?
Awardees must agree to:
Maintain tax-exempt status.
Maintain their status as an OFN Member in Good Standing.
Use Grant Proceeds only to make loans to Community Businesses.
Submit quarterly reports in year one and a final report at the end of the two-year Grant Period.
Participate in marketing and PR activities upon the request of OFN.
Undergo an independent Jobs Count Review by CARS™.
Can the capital grant proceeds be used to cover loan losses?
The capital grant proceeds must be used to make loans, but if any of those loans are written off, the capital grant can be used to absorb the loss.
Are the restrictions on capital grant use released after the two-year grant period?
III. Eligible Financing Activities
Are off-balance sheet loans an eligible lending activity?
Off-balance sheet loans to Community Businesses are eligible only if the CDFI has capital at risk in the capital structure of the off-balance sheet facility or the off-balance sheet facility has recourse to the CDFI. A CDFI with eligible off-balance sheet loans can choose to include or exclude these loans in their responses to the application questions on the applicant’s loan projections and pipeline of loans. If an Awardee includes off-balance sheet in its application, they must include off-balance sheet loans and related jobs created and retained when reporting on their Community Business loans.
Are NMTC loans considered an eligible lending activity?
NMTC loans made to Community Businesses are eligible only if the CDFI is the leveraged lender in the NMTC loans.
Are participations in loans considered an eligible lending activity?
Participation loans are eligible lending activities if the participation takes place at time of original loan closing, the CDFI is an essential participant in the transaction, and the loan to the Community Business would not have closed if not for the participation.
Are loan purchases considered an eligible financing activity?
Purchases of Community Business loans are eligible lending activities if the seller is a CDFI and the loan purchase takes place at origination.
Is debt with equity considered an eligible financing activity for a Create Jobs for USA capital grant?
Debt with Equity is an eligible transaction whenever there is a debt instrument that has a stated maturity date and/or amortization schedule and an equity participation (warrants, royalties, etc.) that offers the potential to increase the return on debt. If the transaction is structured such that equity participation can be used to meet debt principal payments or that debt principal payments are contingent on cash flow or revenue participation, then the transaction is not eligible.