NCRC: The New CARES Act Doesn’t Care Enough

Today, the House of Representatives joined the Senate and passed a $484 billion emergency relief bill, including a $321 billion infusion for the Paycheck Protection Program, the small business rescue fund that ran out of money last week. The package also provides another $60 billion in economic disaster loans for small businesses, $75 billion in emergency relief for hospitals and $25 billion to ramp up coronavirus testing.

Jesse Van Tol, CEO of the National Community Reinvestment Coalition (NCRC), provided the following statement:

“This bill doesn’t do nearly enough for very small or minority-owned businesses that have been devastated by the nation’s economic collapse. We expect the additional PPP funding will run out of money just as quickly as the first round, if not sooner, and it’s only going to reach very small and minority-owned businesses if the Small Business Administration makes that a priority. Congress should have gone much further and required that, but it didn’t. If the SBA doesn’t explicitly prioritize micro-businesses and minority-owned businesses, it’s likely that bigger companies will once again dominate the program while the smallest businesses and minority-owned businesses are once again left out.

“Congress should have gone further to direct PPP funds through Community Development Financial Institutions (CDFIs), which traditionally have served the very smallest businesses. The bill authorized CDFIs to be PPP lenders, and that’s great. But the bill didn’t require lending to flow through CDFIs. I hope the SBA, Federal Reserve and lenders work hard to make sure PPP loans get to very small businesses this time, but all of that should have been required and not left up to the Trump administration.

“As huge as it was, this bill also skipped other critical issues that will have to be addressed in another bill, and soon, including additional assistance to struggling homeowners, renters, landlords and people experiencing homelessness. How about a freeze on bank fees, or a ban on debt collectors who are garnishing stimulus payments meant to put food on the table of struggling families? Local economies are crumbling and families are terrified, but banks are earning billions from PPP fees. How is that ok? Congress should require those fees go to CDFIs or directly to micro-businesses, or homeless shelters, or other nonprofits. The next CARES Act should care more about what’s going on across America.”


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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

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