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Focus Area

Historically Black College & University (HBCU)

After more than 150 years, Historically Black Colleges and Universities (HBCUs) remain misunderstood, underserved, and discounted. HBCUs play an indispensable role in providing higher educational opportunities to thousands of Black people, many of whom are first-generation college students.

Founded in response to America’s extreme segregationist education practices, HBCUs have always been beacons of the arts, politics, innovation and civic engagement for Black communities. However, regardless of the bipartisan support for HBCUs, these institutions are woefully underfunded.

As part of Reinvestment Fund’s own mission to build equitable communities, we are committed to serving the needs of HBCUs that support Black students and the communities surrounding the schools. Since 2018, Reinvestment Fund has loaned nearly $35 million to HBCUs to support the financial health of these institutions and fund capital projects.

We are energized by the opportunities in this sector and seek to help HBCUs get the resources they need and deserve. Our goal is to model business practices and develop a community of practice to help HBCUs overcome “The HBCU Paradox,” or the phenomenon of schools being underserved and discounted by philanthropy, government and other stakeholders including government funders and private lenders.

Our Commitment

We are committed to improving our understanding and support of HBCUs through the following:

  1. Three cross-sector convenings of industry experts and stakeholders, including HBCU presidents, national financial institutions (including CDFIs), researchers, and other key thought leaders, to identify best practices with the following themes: Access to Capital, Telling the HBCU Story and HBCU Capacity Building.
  2. Funding to provide affordable, flexible, mission-driven debt capital, designed to meet the schools’ needs. This new funding will be accompanied by:
    • A new underwriting approach to better reflect the financial realities of the schools to thoughtfully improve their access to debt capital.
    • Technical Assistance resources on financing and capital improvements for school leaders looking to transform their campuses and communities.
  3. A public policy framework to advocate for equitable funding to HBCUs.

The HBCU Brilliance Fund

Reinvestment Fund is building a $25 million HBCU Brilliance Fund to demonstrate the type of technical and financial support that will position HBCUs to make critical investments in their facilities, financial stability, and long-term growth to better serve their institutional missions. HBCUs are also important anchor institutions in their neighborhoods, and investments in these schools supports the social and economic wellbeing of the surrounding community. Based on the schools Reinvestment Fund has financed to date, we expect the student population served will be over 90% Pell Grant recipients and majority first-generation college students.

While HBCUs are experiencing unprecedented media attention and philanthropic support, they remain severely underserved. For all 107 HBCUs, the total endowment is $2.1 billion. In comparison, there are 54 predominantly white [education] institutions (PWIs) that have $2 billion or more in just their own endowments. According to The Institute for Higher Education Policy, PWIs receive eight times the philanthropic dollars per student as that of HBCUs.

After nearly two centuries of extremely disparate treatment of HBCUs, Reinvestment Fund hopes to organize partners on a new path forward.

For more information, contact

 
 
Yonina Gray
Director of External Relations
 
 
Michael Pokorny
Regional Director, Lending & Investments

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