Bill Text: NJ ACR62 | 2024-2025 | Regular Session | Introduced
Bill Title: Urges Congress to oppose proposed federal regulatory changes to "Community Reinvestment Act."
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced) 2024-01-09 - Introduced, Referred to Assembly Community Development and Women's Affairs Committee [ACR62 Detail]
Download: New_Jersey-2024-ACR62-Introduced.html
ASSEMBLY CONCURRENT RESOLUTION No. 62
STATE OF NEW JERSEY
221st LEGISLATURE
PRE-FILED FOR INTRODUCTION IN THE 2024 SESSION
Sponsored by:
Assemblywoman GARNET R. HALL
District 28 (Essex and Union)
SYNOPSIS
Urges Congress to oppose proposed federal regulatory changes to "Community Reinvestment Act."
CURRENT VERSION OF TEXT
Introduced Pending Technical Review by Legislative Counsel.
A Concurrent Resolution urging the United States Congress to oppose proposed federal regulatory changes to the "Community Reinvestment Act."
Whereas, The federal "Community Reinvestment Act" (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; and
Whereas, The CRA has been a critical tool in working to end the practice of redlining, the discriminatory practice by which banks actively avoided making loans to lower-income neighborhoods; and
Whereas, By examining and rating banks, the CRA has helped to increase lending to LMI neighborhoods because the law holds banks publicly accountable for lending, investing and providing bank services to LMI borrowers and communities; and
Whereas, Between 1993 and 1998, the United States Department of Treasury documented that loans to LMI borrowers increased by 39 percent, more than twice the 17 percent rate of growth for loans to middle and upper-income borrowers and communities; and
Whereas, Despite the significant progress made under the CRA in addressing discriminatory lending practices and the fact that, between 2007 and 2017, minority-owned small businesses grew by 79 percent, minority-owned firms are much less likely to be approved for small business loans than white-owned firms, and if approved are more likely to receive lower amounts and higher interest rates; and
Whereas, Female entrepreneurs continue to face challenges accessing capital, with only four percent of the total dollar value of all small business loans going to women entrepreneurs; and
Whereas, The Trump administration has proposed regulatory changes to the CRA, such as allowing banks to finance improvements to athletic stadiums in low-income census tracts located in Opportunity Zones, providing CRA credit for middle-income housing units located in upper-income areas, and allowing banks to offer financial education to people of all income levels instead of solely providing this service to low and moderate-income people; and
Whereas, These proposed regulatory changes to the CRA will harm community development in LMI areas, and weaken the financial investments already made, throughout New Jersey and the nation; and
Whereas,
It is altogether fitting and proper to urge the United States Congress to
oppose the proposed federal regulatory changes to the "Community Reinvestment
Act," thereby defending LMI communities, businesses, and individuals in New
Jersey and across the nation; now, therefore,
Be It Resolved by the General Assembly of the State of New Jersey (the Senate concurring):
1. This House urges the United States Congress to oppose the proposed federal regulatory changes to the "Community Reinvestment Act."
2. Copies of this resolution, as filed with the Secretary of State, shall be transmitted by the Clerk of the General Assembly or the Secretary of the Senate to the Majority and Minority Leaders of the United States Senate, to the Speaker and Minority Leader of the United States House of Representatives, and to each member of the United States Congress elected from this State.
STATEMENT
This concurrent resolution urges the United States Congress to oppose proposed federal regulatory changes to the "Community Reinvestment Act."
The federal "Community Reinvestment Act" (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 CRA has been a critical tool in working to end the practice of redlining, the discriminatory practice by which banks actively avoided making loans to lower-income neighborhoods. The CRA has helped to increase lending through the examination and rating of banks as the law holds banks publicly accountable for lending, investing and providing bank services to LMI borrowers and communities.
Between 1993 and 1998, the United States Department of Treasury documented that loans to LMI borrowers increased by 39 percent, more than twice the 17 percent rate of growth for loans to middle- and upper-income borrowers and communities.
Despite the significant progress made under the CRA in addressing discriminatory lending practices and the fact that, between 2007 and 2017, minority-owned small businesses grew by 79 percent, minority-owned firms are much less likely to be approved for small business loans than white-owned firms, and if approved are more likely to receive lower amounts and higher interest rates. Furthermore, female entrepreneurs continue to face challenges accessing capital, with only four percent of the total dollar value of all small business loans going to women entrepreneurs.
The Trump administration has proposed regulatory changes to the CRA, such as allowing banks to finance improvements to athletic stadiums in low-income census tracts located in Opportunity Zones, providing CRA credit for middle-income housing units located in upper-income areas, and allowing banks to offer financial education to people of all income levels instead of solely providing this service to low and moderate-income people. These regulatory changes would harm community development in LMI areas and weaken the financial investments already made throughout New Jersey and the nation.
