This loan fund couldn’t find affordable housing to support, so they’re building it
The Northwest Native Development Fund is taking an upstream approach to boosting affordable housing and entrepreneurship on Washington’s Colville Reservation.
Ted Piccolo wants to build at least one house every year on the Colville Reservation in northeastern Washington.
“Maybe one year we’ll do two, depending on how it goes,” says Piccolo, who is executive director of the Northwest Native Development Fund (NNDF), a CDFI focused on education and financing personal loans and small businesses in tribal communities. “We need at least 10 new houses in inventory.”
NNDF is already working on this goal. In 2019, the organization created the Upstream Housing Initiative to fund and build new homes. Earlier this year, they completed the first pilot home, a 1,500 square foot, three-bedroom home that was later sold to a young family. NNDF plans to use the proceeds to build more housing.
“We are now looking for a property to build another one to try to bring new homes to market,” says Piccolo.
In addition to building affordable homes, the initiative also funds local builders who want to build or renovate and flip properties. NNDF has committed $1 million to this effort, with the goal of adding 10 to 15 new homeowners in the area who can buy homes in the $180,000 range.
The lack of affordable housing available in the region is causing a housing crisis, which is preventing the region from retaining professionals, such as teachers and nurses.
“We have the funding; we have qualified people pre-qualifying for a home loan, but then there’s nothing,” Piccolo says.
Many of the homes available are older and need a lot of work or are manufactured homes, which Piccolo says many traditional lenders won’t finance home buyers. “We want to finance prefabricated houses in a way that does not penalize or stigmatize anyone,” he adds.
NNDF also helps individuals from tribal communities become homeowners through Individual Development Accounts (IDAs), where the organization matches $4 for every dollar someone saves to buy a home or start a business. ‘a company. To receive the funding, Piccolo says individuals must complete a free educational program, which for homebuyers involves a family budget.
“We want to give people the basic skills to buy a house and manage their budget,” he adds.
Other personal development courses are available including financial literacy, marketing, QuickBooks and “Indianpreneurship” to cover the essentials for starting a business. Since the official launch of NNDF in 2008, the organization has hosted over 600 course and workshop participants and provided over 250 loans worth over $14.4 million. In 2021 alone, they loaned over $3 million.
Funding is also available for business development for people from tribal communities in Washington and beyond. Piccolo says it’s hard for a small business or startup to get financing through traditional lenders, but it’s even harder for tribal businesses.
“A lot of lending institutions are not comfortable trying to do business on the reserve,” he says. Many do not understand the “trust status” of reservation land, where land is held in trust by the federal government for the use of a tribe, or how the use of property on the reservation as collateral works.
Many of the companies funded by NNDF are in the logging and fishing sectors, Piccolo says. For example, they funded a small artisanal salmon processing company that works with native fishers in Portland, Oregon. NNDF has also helped fund the development of The Bunkhouse Hotel in Jackson, Montana, to boost tourism in the area. CDFI’s investment also helped a descendant of the Colville tribe buy and save a 50-year-old body shop in Electric City, Washington.
Consumer loans $500 to $6,000 is another area of investment. These include credit building loans, employee loans to help individuals access funds without needing to go to a payday lender, and “anti-payday loans” to pay off existing debt and provide a single loan.
Through education, fundraising and housing initiatives, NNDF strives to build wealthy and economically viable tribal communities. Piccolo says the organization refers to itself as “the little loan fund that could” – as they have always believed that there was no project too big or too complicated for them to handle as long as he was helping the tribal communities.
“It starts with saying, ‘Don’t say no. Let’s just say how,” he says. “We think the sky is the limit of what we can do in bringing funding to our community. And he really is a driver. We are a community engine.
This story is part of our series, CDFI Futures, which explores the community development finance industry through the lens of equity, public policy and inclusive community development. The series is generously supported by Partners for the Common Good. Sign up for PCG’s CapNexus newsletter at capnexus.org.
Erica Sweeney is a freelance journalist based in Little Rock, AR. She covers health, wellness, business and many other topics. Her work has appeared in The New York Times, The Guardian, Good Housekeeping, HuffPost, Parade, Money, Insider and more.