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Advocacy groups remind bank regulators of the urgent need for stronger CRA rules and tougher enforcement on lending equity and bank mergers

With a new proposal imminent from bank regulators, community, civil rights and consumer advocacy groups stress the urgency of updates to Community Reinvestment Act

With federal bank regulators poised to unveil new rules for implementation of the Community Reinvestment Act (CRA), local and national community advocacy groups today reminded them of the urgent need to make CRA exams more rigorous, expand data collection and improve communication around merger reviews.

The National Community Reinvestment Coalition (NCRC), joined by 123 other organizations, outlined in a position paper published today priorities for the CRA rule changes expected to be proposed soon by the Office of the Comptroller of the Currency (OCC), Federal Deposit Insurance Corp. (FDIC) and the Federal Reserve Board. CRA is a civil rights era law meant to end and reverse the impact of 20th Century redlining, a racist system that starved communities of color of access to credit to buy homes or build and grow businesses. CRA required banks to lend in all communities where they are chartered to do business. The NCRC paper reviewed the urgent need for changes to both the process and metrics of CRA exams that evaluate lender performance, as well as updates to how digital banks are assessed.

The imminent arrival of a new joint proposal from the regulators follows years of discussions, public comments, and a Trump administration effort through the OCC, without the support of the other banking agencies, which was fully rescinded by the OCC under the Biden administration.

“The racial chasms within our economy remain almost as wide as they were 45 years ago when Congress passed the Community Reinvestment Act to begin closing them. Yet the current rules enforcing that law deem nearly every lending institution in the country ‘satisfactory’ in its contribution to the law’s goals,” NCRC President and CEO Jesse Van Tol said. “That’s the definition of a broken system – and regulators must bring the law and its enforcement in line with reality.”

The NCRC paper also called for greater public involvement in agency merger reviews. Agencies must improve their communication with local stakeholders during reviews, the letter said. The review processes themselves should also be improved, the paper said, by evaluating how merging banks will benefit the public and encouraging banks to negotiate community benefit agreements with local groups whose constituents are affected by proposed acquisitions.

The full paper from NCRC and 123 community groups can be read here.

Additional background on CRA modernization efforts can be found at NCRC’s TreasureCRA hub.

Other recommendations in the paper included:

  • Using more explicit race data in CRA exams to judge how banks are lending to and serving communities of color
  • Providing CRA examiners more specific and objective guidance for rating banks
  • Giving lenders additional credit for projects that address climate resilience and remediation
  • Collecting more and clearer CRA data on small business lending, community development financing, and deposit accounts

The paper was signed by 123 local and national community organizations:

Americans for Financial Reform Education Fund
Better Markets
Ceres
Consumer Action
Corporation for Supportive Housing (CSH)
National Alliance of Community Economic Development Associations (NACEDA)
National Association of American Veterans, Inc.
National CAPACD
National Community Reinvestment Coalition
National NeighborWorks Association
National Urban League
Opportunity Finance Network
Poverty and Race Research Action Council
Public Citizen
The Leadership Conference on Civil and Human Rights
U.S. Conference of Mayors
UnidosUS

Alabama

Alabama Asset Building Coalition
Birmingham Business Resource Center
Building Alabama Reinvestment
Dothan Housing
Ensley District Developers
Fair Housing Center of Northern Alabama
NAACP Economic Programs
Titusville Development Corporation, a CDC

Arizona

Arizona Housing Coalition
Chicanos Por La Causa Action

California

ASIAN, Inc.
Beneficial State Foundation
caarma.org
California Coalition for Rural Housing
California Reinvestment Coalition
Community Vision Capital & Consulting
Homeownership Council of America
Low Income Investment Fund
Mutual Housing
Peoples Opportunity Fund
The Greenlining Institute
Vermont Slauson EDC

Colorado

African American Trade Association
Urban Land Conservancy

District of Columbia

Latino Economic Development Center
Manna Inc.
New Community Church

Delaware

Delaware Community Reinvestment Action Council, Inc.
Wilmington Neighborhood Conservancy Land Bank 

Florida

Affordable Homeownership Foundation, Inc.
Community Reinvestment Alliance of South Florida
Florida Housing Coalition
Little Haiti Housing Association, Inc.
Solita’s House

Georgia

Georgia Advancing Communities Together, Inc.

Hawaii

Hawai’i Alliance for Community-Based Economic Development

Illinois

Chicago Community Loan Fund
Housing Action Illinois
Illinois People’s Action
Universal Housing Solutions CDC
Woodstock Institute

Indiana

Fair Housing Center of Central Indiana, Inc.
God’s Helping Hand Community Housing Development Organization Incorporated
HomesteadCS
Northwest Indiana Reinvestment Alliance
South Bend Heritage Foundation

Kentucky

Urban Coalition of Appraisal Professionals

Louisiana

Jane Place Neighborhood Sustainability Initiative

Massachusetts

ACE
MACDC
Massachusetts Affordable Housing Alliance

Maryland

African American Chamber of Commerce of Montgomery County, Inc.
Community Development Network of Maryland
Housing Options & Planning Enterprises, Inc.
Maryland Consumer Rights Coalition
PFC Black Chamber of Commerce Inc.

Michigan

LINC UP Nonprofit Housing Corporation
U SNAP BAC INC

Minnesota

Community Reinvestment Fund, USA
Jewish Community Action
Lewis Associates

Missouri

Habitat for Humanity of Kansas City
Justine PETERSEN
Metropolitan St. Louis Equal Housing and Opportunity Council
R.A.A. – Ready, Aim, Advocate

Mississippi

Mississippi Communities United for Prosperity (MCUP)

North Carolina

Community Link
Henderson and Company
Historic District Developers
National Trust for Historic Preservation
Olive Hill Community Economic Development Corporation, Inc.
Reinvestment Partners
Town of Apex

New Jersey

New Jersey Citizen Action
Urban League of Essex County

New Mexico

Southwest Neighborhood Housing Services

New York

Association for Neighborhood and Housing Development
Center for NYC Neighborhoods
Central Islip Civic Council Inc.
Devotion USA, Inc.
Empire Justice Center
Fair Finance Watch
Long Island Housing Services, Inc.

Oregon

Ohio CDC Association
Working In Neighborhoods
CASA of Oregon
Housing Oregon

Pennsylvania

Catapult Greater Pittsburgh
Ceiba
Community First Fund
Fair Housing Rights Center in SEPA
NeighborWorks Association of Pennsylvania
PACDC
Pittsburgh Community Reinvestment Group
Southwest CDC

Puerto Rico

One Stop Career Center of PR Inc.

Rhode Island

HousingWorks RI

Tennessee

BLDG Memphis
green|spaces

Texas

Prosper Waco
Southern Dallas Progress Community Development Corporation
SouthFair Community Development Corp
TCH Development, Inc.

Virginia

Piedmont Housing Alliance

Wisconsin

Community Advantage Enterprises, Inc.
Metropolitan Milwaukee Fair Housing Council

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Redlining and Neighborhood Health

Before the pandemic devastated minority communities, banks and government officials starved them of capital.

Lower-income and minority neighborhoods that were intentionally cut off from lending and investment decades ago today suffer not only from reduced wealth and greater poverty, but from lower life expectancy and higher prevalence of chronic diseases that are risk factors for poor outcomes from COVID-19, a new study shows.

The new study, from the National Community Reinvestment Coalition (NCRC) with researchers from the University of Wisconsin–Milwaukee Joseph J. Zilber School of Public Health and the University of Richmond’s Digital Scholarship Lab, compared 1930’s maps of government-sanctioned lending discrimination zones with current census and public health data.

Table of Content

  • Executive Summary
  • Introduction
  • Redlining, the HOLC Maps and Segregation
  • Segregation, Public Health and COVID-19
  • Methods
  • Results
  • Discussion
  • Conclusion and Policy Recommendations
  • Citations
  • Appendix

Complete the form to download the full report: