homeWORD
September 16, 2004
John M. Reich
Vice Chairman
Federal Deposit Insurance Corporation
550 17th Street,
NW
Washington, DC 20429
Dear Mr. Reich:
Despite the successes locally and nationally of community investment,
the banks and thrift institutions that provided the loans and investments
to build new homes, businesses, and community facilities may no longer
have the impetus to do so if you change the CRA exam threshold.
We have been informed by our association, the National Congress
for Community Economic Development that the Federal Deposit Insurance
Corporation is considering changes to weaken the Community Reinvestment
Act.
it is estimated that 2,000 financial institutions would no longer
be evaluated on their investment or services to low- and moderate-income
communities. These banks have assets of nearly $1 trillion, and an
estimated $5 billion of private capital for affordable housing and
community development over the next few years.
These proposed
rule changes would have a devastating effect on affordable housing
investment in our state and elsewhere throughout the
nation, particularly in rural areas.
In the past eight
years our organization have built 50 homes and educated over 2000
households about homebuyer needs and opportunities. homeWORD coordinates
the Home$tart program for eight banks and has been a model for
how banks can work closely with community development organizations
to support law- and moderate- incomes families buying their first
homes. We have increased property values and the quality of life
for hundreds of residents to our community.
We are very concerned that this step is being taken without Congressional
action. Our legislators know that without financial partners, our
efforts to revitalize our community would be nearly impossible.
The FDIC should be strengthening incentives for financial institutions
to invest in the communities that provide homes, jobs, and economic
opportunities to working families. Please do not raise the CRA exam
threshold.
Sincerely,
Betsy Hands,
Community Outreach Coordinator
homeWORD
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