Community Reinvestment Act

Department of Treasury, Office of the Comptroller of the Currency

Program Type:

Regulation/Law

Eligible Geography:

Nationwide

Summary:

The Community Reinvestment Act of 1977 (CRA) encourages certain insured depository institutions to help meet the credit needs of the communities in which they are chartered, including low- and moderate-income (LMI) neighborhoods, consistent with the safe and sound operation of such institutions. The CRA effectively encourages financial institutions to offer loans for community and economic development to low income neighborhoods.

The CRA requires federal banking agencies to assess the institution’s record of meeting the credit needs of its entire community, including LMI neighborhoods, consistent with the safe and sound operation of such institution, and take such record into account in its evaluation of an application for a deposit facility by such institution. This score is used to evaluate applications for future approval of bank mergers, charters, acquisitions, branch openings, and deposit facilities.

Eligible Recipients:

Financial Institution

Eligible Recipients Detail:

Financial Institutions

Eligible Purpose:

Last Mile Connectivity; Middle Mile Connectivity; Broadband-Technologies Workforce Training; Building Connectivity; Broadband Enabled Device (Education); Digital Inclusion/Digital Skills Training

Eligible Purpose Detail:

Investments can include facilitating the construction, expansion, improvement, maintenance or operation of essential infrastructure or facilities for health services, education, public safety, public services, industrial parks or affordable housing.

The following broadband-related investments are listed as eligible by CRA Illustrative List of Qualifying Activities:

-Grant to a nonprofit community program which assists LMI individuals to find and enroll in free or low-cost home broadband internet services for which they are eligible.
-Investment in a local cooperative to develop broadband infrastructure and expand access to LMI residents in the area.
-Public welfare investment, under 12 CFR part 24, to finance the construction of a broadband network to develop reliable internet access in an LMI census tract.
-Community support services which means activities, such as child care, education, workforce development and job training programs, health services, and housing services, that partially or primarily serve or assist low- or moderate-income individuals or families
-Loan to a non-profit training center that provides workforce development and job training programs, which primarily serve unemployed, LMI individuals.
-Activities that promote job creation or job retention partially or primarily for low- or moderate-income individual
-Financial support of a nonprofit community program that provides digital literacy training to residents of an LMI neighborhood, in order to increase their ability to use online banking services.

Excluded Programs:

Grant to a nonprofit community program which assists LMI individuals to find and enroll in free or low-cost home broadband internet services for which they are eligible. The Federal Reserve Bank of Richmond will be updating CRA regulations to allow broadband investments made by lenders to qualify as CRA compliance. A representative of the Federal Reserve discussed how this regulatory change could help broadband expansion into rural and underserved communities.

Investment in a local cooperative to develop broadband infrastructure and expand access to LMI residents in the area.

Public welfare investment, under 12 CFR part 24, to finance the construction of a broadband network to develop reliable internet access in an LMI census tract.

Funding Match/Terms:

NA

Note/Additional Resources:

https://www.federalregister.gov/documents/2020/06/05/2020-11220/community-reinvestment-act-regulations

https://www.occ.treas.gov/topics/consumers-and-communities/cra/cra-final-rule-fact-sheet.pdf

https://www.occ.treas.gov/topics/consumers-and-communities/cra/cra-illustrative-list-of-qualifying-activities.pdf

Source:

https://www.ntia.doc.gov/report/2020/ABI_Progress_Report