ANHD Statement on New Community Reinvestment Act (CRA) Proposal

On May 5th, federal bank regulators at the Federal Reserve Board, Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC) jointly released a Notice of Proposed Rulemaking (NPR) for a modernized Community Reinvestment Act (CRA). 

The Association for Neighborhood & Housing Development (ANHD) applauds the agencies for taking meaningful steps to modernize and strengthen the rules governing the Community Reinvestment Act (CRA). If passed, this proposal will be the first major update of the CRA in over 25 years. 

Advancing this rule offers a historic opportunity to modernize and strengthen the civil-rights era anti-redlining CRA, but it must go further in addressing racial disparities and preventing displacement. 

At an early glance, we can see the NPR made advances in several areas, including attention to smaller businesses, analysis of more bank activities, and reference to responsible underwriting in community development.  However, it is also immediately clear that the CRA NPR does not go far enough to address racial disparities and combat displacement elsewhere. Systemic racism  continues to harm Black, Indigenous and People of Color (BIPOC) and communities, impeding their ability to build wealth, access resources, and stay in their homes. None of this can be reversed with color-blind policies such as the CRA proposal put forth last week.     

The CRA is one of several landmark civil rights laws passed in the 1960s and 1970s in response to systemic racism, redlining, and discrimination. It requires banks to lend and provide banking services equitably, and direct money and investments to low-income communities. While ANHD recognizes the strengths and benefits of the CRA, we also know it has not been effective enough to combat persistent racial disparities in lending, banking, and investments; stem the tide of branch closures; nor combat predatory and extractive practices that harm and displace BIPOC and communities. 

ANHD looks forward to working with our members to evaluate and comment on the full proposal in detail. We call on the three regulators to ensure the final rule changes more closely reflect ANHD’s principles for CRA Reform, to create a race-conscious CRA that measures the quantity and quality of activities; downgrades for harm and displacement; centers community input and needs; and maintains strong local obligations. See the full CRA proposal here.  Learn more about the proposed rule, CRA and ways to engage at ANHD.