Rep. Boyd, OLBC Members Sign On To Letter Regarding The Community Reinvestment Act (CRA)
Say changes to the CRA performances will delay an economic recovery from COVID-19
August 11, 2020
[ Janine R. Boyd Home | Janine R. Boyd Press ]

COLUMBUS— State Rep. Janine Boyd (D-Cleveland Heights) and the Ohio Legislative Black Caucus (OLBC) signed onto a letter by the National Community Reinvestment Coalition regarding the Office of the Comptroller of the Currency’s (OCC) changes to the Community Reinvestment Act (CRA) performances, which would delay an economic recovery from COVID-19. The CRA, enacted in 1977, requires the Federal Reserve and other federal banking regulators to encourage financial institutions to help meet the credit needs of the communities in which they do business, including low and moderate-income (LMI) neighborhoods.

The changes to the CRA include:

  • Expanding CRA credit for bank financing of essential infrastructure and community facilities such as roads, bridges, sewers, trash facilities police and fire stations. Estimating the benefit to LMI populations of such large-scale projects is difficult and likely to result in CRA ratings inflation, as well as divert funding from community development projects directly in LMI communities.

  • Removing the service test, which examines retail and community development services and is currently 25 percent of a CRA exam. This is likely to lead to a severe decrease in bank branches in communities with LMI.

  • Modifying the CRA exams for hundreds of banks in ways that will reduce incentives for them to keep bank branches open in LMI neighborhoods, as well as incentives for them to participate in neighborhood and commercial revitalization efforts in lower-income neighborhoods.

Long after the passage of the Civil Rights Act of 1964, numerous studies and reports have revealed a long line of policies that continue housing discrimination, segregation and inequitable investment into LMI neighborhoods. The President of the United States, in his own words, recently demonstrated his interest in modernizing and furthering such racist policies. Therefore, as elected leaders who make up the oldest Legislative Black Caucus in the nation, it is our responsibility to push back on any effort to reverse the path of progress for Black people,” said Rep. Boyd.

The OLBC is committed to addressing systematic racism and establishing equity and opportunity in health, housing, education, employment, criminal justice and economic and business development policy. It is the concern of the OLBC that the changes to the CRA will lead to an increased financial disinvestment in poor communities and communities of color. According to a 2018 report by the National Community Reinvestment Coalition, the forecast is that low and moderate income neighborhoods in Ohio will see a drop of $975.4 million to $2 billion during the first five years of these changes.


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