Brown, Waters, and Meeks Lead House and Senate Committee Democrats in Letter to Regulators on Proposed CRA Changes

WASHINGTON -- Today, Senator Sherrod Brown (D-OH), Ranking Member of the Senate Committee on Banking, Housing and Urban Affairs, Congresswoman Maxine Waters (D-CA), Chairwoman of the House Financial Services Committee, and Congressman Gregory Meeks (D-NY), Chairman of the House Subcommittee on Consumer Protection and Financial Institutions, led a letter to  Jerome H. Powell, Chairman of the Board of Governors of the Federal Reserve System,  Joseph M. Otting, Comptroller of the Currency, and Jelena McWilliams, Chairman of the Federal Deposit Insurance Corporation, demanding that regulators provide the public, Members of Congress, and all interested parties with adequate time to thoroughly review and offer input on proposed changes to the framework of the Community Reinvestment Act (CRA).

The letter was signed by every Democratic Member of the House Financial Services Committee and Senate Committee on Banking, Housing and Urban Affairs.

“The CRA is a critical tool to combat redlining, a practice that still exists by which banks discriminate against prospective customers based primarily on where they lived, or their racial or ethnic background, rather than creditworthiness,” the lawmakers wrote. “Many of us have shared our views and concerns with you regarding your proposed changes to implementation of the CRA. Based on your past responses and statements, as well as the feedback we have received from interested stakeholders, we remain extremely concerned about the direction any proposed rule is likely to take and efforts to arbitrarily rush to finalize a rule in the near future.”

See the full text of the letter below.

The Honorable Jerome H. Powell

Chairman

Board of Governors of the Federal Reserve System

20th Street & Constitution Avenue, NW

Washington DC 20219

The Honorable Joseph M. Otting

Comptroller     

Office of the Comptroller of the Currency

400 7th Street SW

Washington, DC 20551

The Honorable Jelena McWilliams

Chairman

Federal Deposit Insurance Corporation

550 17th Street, NW

Washington, DC 20429

Dear Chairman Powell, Comptroller Otting, and Chairman McWilliams:

We are writing regarding recent testimony and news that one or more of your agencies may soon issue a proposed rule to revise regulations implementing the Community Reinvestment Act (CRA).[1] As you know, the law directs your agencies to hold banks accountable in fulfilling their “continuing and affirmative obligation to help meet the credit needs of the local communities in which they are chartered.”[2] The CRA is a critical tool to combat redlining, a practice that still exists by which banks discriminate against prospective customers based primarily on where they live, or their racial or ethnic background, rather than creditworthiness.[3]

Many of us have shared our views and concerns with you regarding your proposed changes to implementation of the CRA. Based on your past responses and statements, as well as the feedback we have received from interested stakeholders, we remain extremely concerned about the direction any proposed rule is likely to take and efforts to arbitrarily rush to finalize a rule in the near future.

To the extent one or more of your agencies decides to proceed with a proposed rule, we request that you provide a public comment period of no less than 120 days for substantive review and comment on the proposal. Given the complexity of this rulemaking and the impact of the CRA, particularly within communities of color and for those who have been historically underserved by our financial system, it is essential that your agencies provide adequate time for thorough review by all interested parties.

We look forward to your prompt attention to this request.

Sincerely,

Rep. Maxine Waters

Senator Sherrod Brown

Rep. Gregory W. Meeks

Senator Jack Reed

Senator Robert Menendez

Senator Jon Tester

Senator Mark R. Warner

Senator Elizabeth Warren

Senator Brian Schatz

Senator Chris Van Hollen

Senator Catherine Cortez Masto

Senator Doug Jones

Senator Tina Smith

Senator Kyrsten Sinema

Rep. Carolyn B. Maloney

Rep. Nydia M. Velázquez

Rep. Brad Sherman

Rep.  Wm. Lacy Clay

Rep. David Scott

Rep. Al Green

Rep. Emanuel Cleaver

Rep. Ed Perlmutter

Rep. Jim A. Himes

Rep. Bill Foster

Rep. Joyce Beatty

Rep. Denny Heck

Rep. Juan Vargas

Rep. Josh Gottheimer

Rep. Vicente Gonzalez

Rep. Al Lawson

Rep. Michael San Nicolas

Rep. Rashida Tlaib

Rep. Katie Porter

Rep. Cindy Axne

Rep. Sean Casten

Rep. Ayanna Pressley

Rep. Ben McAdams

Rep. Alexandria Ocasio-Cortez

Rep. Jennifer Wexton

Rep. Stephen F. Lynch

Rep. Tulsi Gabbard

Rep. Alma Adams

Rep. Madeleine Dean

Rep. Jesús “Chuy” García

Rep. Sylvia Garcia

Rep. Dean Phillips

cc: The Honorable Kathy Kraninger, Director, Consumer Financial Protection Bureau

The Honorable Martin Gruenberg, Board Member, Federal Deposit Insurance Corporation

The Honorable Richard Clarida, Vice Chair, Board of Governors of the Federal Reserve System

The Honorable Randal Quarles, Vice Chair for Supervision, Board of Governors of the Federal Reserve System

The Honorable Lael Brainard, Governors, Board of Governors of the Federal Reserve System

The Honorable Michelle Bowman, Governors, Board of Governors of the Federal Reserve System



[2] 12 USC §2901

[3] See Aaron Glantz and Emmanuel Martinez, “Kept Out: For people of color, banks are shutting the door to homeownership,” Reveal from The Center for Investigative Reporting (Feb. 15, 2018).