COMMUNITY DEVELOPMENT COALITION OF ARIZONA
September 3, 2004
Donald E. Powell
Chairman
Federal Deposit Insurance Corporation
550 17th Street, NW
Washington, DC 20429
John M. Reich
Vice Chairman
Federal Deposit Insurance Corporation
550 17th Street,
NW
Washington, DC 20429
Thomas J. Curry
Director
Federal Deposit Insurance Corporation
550 17th Street, NW
Washington, DC 20429
John D. Hawke, Jr.
Comptroller of the Currency
Office of the Comptroller of the Currency
250 E Street, SW
Washington, DC 20219
Gentlemen:
I am writing to express strong concern and opposition for the proposal
being made to change the CRA exam threshold. Communities in Arizona
are working hard to address the housing needs of their working families
as well as lower-income households, and also undertake community
revitalization in long-neglected areas. We have good state level
public sector programs, and have been successful in also utilizing
federal funds but the lending institutions are a key partner as well
and an important part of the solution.
Despite our successes locally and across the country, the banks and
thrift institutions that provide 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.
It is estimated that 2,000 financial institutions would no longer
be evaluated on their investment or services to low and moderate-income
communities under the proposal you are considering to raise the investment
threshold from the current level of $250 million to $l billion. These
proposed rule changes would have a devastating effect on affordable
housing investment in Arizona and elsewhere.
This proposal would eliminate the CRA exam threshold, from 45 of
the 50 institutions in Arizona. This would dry up the business now
occurring in low-income communities and put an inordinate demand
on the remaining 5 financial institutions that would still have the
CRA exam threshold obligation.
CRA work is not
a burden, nor is it a money-loser for financial institutions, and
CRA exam
is not excessively onerous from what the
financial institutions tell me in our local conversations. Please
leave the threshold, as it is now, the asset level of $250 million
works because it covered the majority of the market there by setting
the "norm" for the rest. This is one of the most important
issues affecting the relevance of financial institutions to the communities
that they claim to serve, please don't weaken it.
Sincerely,
Donard C. Taylor
Executive Director
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