United States Development Finance Corporation Effectiveness Act
- Sponsor
- Rep. Castro, Joaquin [D-TX-20]
- Committees
- Foreign Affairs Committee (primary)
- Last action
- Dec 10, 2025
Bottom line
This bill aims to increase transparency and accountability for the DFC's investments by requiring more comprehensive reporting on their strategic, developmental, and financial performance, as well as their ability to mobilize private capital, and making this information publicly accessible.
What it actually does
This bill amends the Better Utilization of Investments Leading to Development (BUILD) Act of 2018 to significantly enhance reporting requirements for the U.S. Development Finance Corporation (DFC). It mandates more detailed annual reports to Congress on strategic objectives, development impact, portfolio health, and private capital mobilization. Additionally, it requires the DFC to maintain a user-friendly, publicly available, machine-readable database with comprehensive project-level information.
Proponents argue
Supporters argue that increased transparency and detailed reporting will ensure the DFC's investments are more effective, align better with U.S. strategic goals, and demonstrate tangible development impacts. This enhanced oversight will lead to better utilization of taxpayer funds, greater private sector engagement, and ultimately, more impactful development outcomes globally.
Opponents contend
Opponents might argue that the expanded reporting requirements could create an undue administrative burden on the DFC, potentially diverting valuable resources from actual project development and slowing down critical investment processes. They may contend that such extensive data collection might not necessarily lead to significantly improved outcomes but could instead hinder the DFC's agility.
The bill is very short and straightforward, making it highly accessible for a reader to understand its provisions within a short timeframe.
Section 2(1) of H.R. 6562, amending Section 1443(a) of the BUILD Act
Expanded Annual Report on DFC Strategic Objectives and Portfolio Health
This provision requires the DFC's annual report to Congress to include detailed information on how its supported projects advance U.S. strategic, foreign policy, and development objectives. It also mandates an overview of the DFC's portfolio health, including funds committed and disbursed, default and recovery rates, capital mobilized, equity investment returns, and a comparison of modeled versus actual investment performance with narrative explanations for any changes.
Supporters argue
Supporters argue this ensures the DFC's activities are transparently aligned with national interests and that its financial performance is rigorously evaluated, allowing for better strategic adjustments and resource allocation of taxpayer funds.
Critics contend
Critics might contend that requiring such granular detail could bog down the DFC with excessive paperwork, diverting resources from actual project development and potentially discouraging necessary risk-taking in challenging markets.
Tradeoffs
This provision balances the need for robust oversight and accountability of a government agency with the potential for increased administrative burden and reduced operational flexibility for the DFC.
Section 2(2) of H.R. 6562, amending Section 1443(b) of the BUILD Act
Comprehensive Project Performance and Private Capital Mobilization Metrics
This section mandates that the DFC's annual report include specific metrics on desired development impact and strategic outcomes (both during and after projects), the value of private sector assets mobilized relative to DFC support, and a comparison of projected versus actual private capital mobilized. It also requires a breakdown of DFC support and contingent liability across less developed, advancing income, and high-income countries, along with an assessment of the DFC's risk appetite and efforts to incentivize calculated risk-taking by its teams.
Section 3 of H.R. 6562, amending Section 1444(1) of the BUILD Act
Creation of a Detailed Public Project Database
This provision requires the DFC to maintain a user-friendly, publicly available, machine-readable database containing detailed project-level information. This includes all information reported to Congress under Section 1443, project-level performance metrics, and a description of the project's development impact, encompassing anticipated impact prior to initiation and assessed impact during and after completion.