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HALIWA SAPONI INDIAN TRIBE
September 16, 2004
Mr. Robert E. Feldman
Executive Secretary
Attention: Comments/Legal ESS
Federal Deposit Insurance Corporation
550 17th Street NW
Washington, DC 20429
Dear Mr. Feldman:
We are a concerned tribe opposed to reducing the CRA (Community
Reinvestment Act) requirements for mid-sized banks. CRA is vital for
increasing homeownership and economic development in lower-income
communities. Your proposed changes will halt the progress that has been
made.
I understand that banks with over.$250 million in assets must be
tested on their nurnber of loans, investments, and services to low- and
moderate-income communities. But your proposal would eliminate the
investment and service requirements for all banks with under $1 billion
in assets. This will result in significantly fewer loans and investments
in affordable rental housing, health clinics, community centers, and
economic development projects.
The proposed changes, which would make smaller banks less accountable
for their community reinvestment activity, deeply concern us, as banks
are finally acknowledging the investment opportunities in Indian
country. Indian country has made strides with the help of banks in the
mortgage arena—we saw conventional mortgage activity increase for Native
Americans in 2003. We believe that the strength of the current law has
been instrumental to this development.
The following data point up the severe continuing needs in our tribal
area that require a strong CRA. According to our last survey, the rate
of homeownership for Native Americans in our tribal area is just 33
percent, or half that of the general population and substantially lower
than that of other minority groups. In addition, Native Americans are
four times more likely than the average American family to live in
substandard housing. (Fannie Mae date,. Testimony, Pattye Greene, May 3,
2004, House Financial Services Committee) Overcrowding has been
documented in the NAIHC study "Too Few Rooms..." (2001) reporting as
many as 25 or even 30 people living in deplorable conditions under one
roof in a 2-or 3-bedroom house.
If the reduced requirements were approved, it would allow mid-sized
banks to choose which community development activities they will
undertake. Right now, these banks must make community development loans,
investments, and services a priority. You proposed test allows banks to
choose only one of the three activities. The result will be less
community development activity. The recent strides in economic
development in Indian country will be lost if banks aren't required to
invest.
You also propose that community development activities in rural areas
should benefit any group of individuals instead of only low-and
moderate-income individuals. This will allow banks to chose and focus on
affluent residents of rural areas rather than the lower income consumers
CRA targets. Finally, you would also eliminate publicly available data
on the small business lending of mid-sized banks. Without data,
community groups and citizens cannot hold banks accountable for lending
to small businesses in their communities.
Your proposed changes directly oppose CRA's mandate to require
lenders to meet community needs. CRA is too important o be significantly
weakened.
Please withdraw your proposal, as did two other federal agencies—the
Office of Thrifts Supervision and the Office of the Comptroller of the
Currency—that recognized the harm of similar changes to underserved
communities.
Sincerely,
Archie Lynch, Tribal Administrator
Haliwa Saponi Indian Tribe
Cc: National American Indian Housing Council
National Community Reinvestment Coalition
President George W. Bush
Senators John Kerry and John Edwards |
