In today’s Federal Register, the following federal agencies – OCC, FRB, FDIC and OTS – published a proposed rule to revise the definition of “community development.” In pertinent part, the proposed revised definition includes “[l]oans, investments, and services that [s]upport, enable, or facilitate projects or activities that meet the criteria described in Section 2301(c)(3) of the Housing and Economic Recovery Act of 2008 (HERA) … and are conducted in designated target areas identified in plans approved by the United States Department of Housing and Urban Development in accordance with the Neighborhood Stabilization Program (NSP) established by the HERA and the American Recovery and Reinvestment Act of 2009 … .” In the preamble to the propose rule, the federal agencies state, “The proposed rule would provide favorable CRA consideration to such activities that, pursuant to the requirements of the program, benefit low-, moderate-, and middle-income individuals and geographies in designated target areas. Such consideration would include covered activities within an institution’s assessment area(s) and outside of its assessment area(s), as long as the institution has adequately addressed the community development needs of its assessment area(s). As proposed, favorable consideration under the new rule would only be available until no later than two years after the last date appropriated funds for the program are required to be spent by the grantees.” If you wish to submit written comments regarding this proposed rule, you must do so by no later than July 26, 2010. The procedures for submitting written comments are contained in the notice published in today’s Federal Register, which is attached to this memorandum for your information and use. We urge all clients affected by this CRA proposed rule change to submit written comments in order to make your views known.
