October 19, 2020

Brown Floor Speech: Protect the Community Reinvestment Act

WASHINGTON, D.C. — U.S. Sen. Sherrod Brown (D-OH) – ranking member of the U.S. Senate Committee on Banking, Housing, and Urban Affairs – delivered the following floor speech urging his colleagues to protect and strengthen the Community Reinvestment Act (CRA). Brown called on his colleagues to support H.J.Res. 90, which would revoke a Trump OCC rule gutting the CRA, which is a key tool facilitating investments in low- and middle-income communities and communities of color, in the middle of an economic crisis.

Sen. Brown’s remarks, as prepared for delivery, follow:
Mr./Madam President, I rise to speak in support of H.J.Res. 90, the Joint Resolution of Disapproval of the Office of the Comptroller of the Currency’s Community Reinvestment Act rule.

We know who’s getting hit the hardest by this pandemic and economic crisis – it’s low-income workers, it’s the middle class, it’s communities of color.

It’s the same story we see over and over and over – corporate lobbyists and their allies in Washington do whatever it takes to make sure Wall Street recovers, and then they say, oh no, we can’t afford to help anyone else.

The stock market is back up, so Leader McConnell and President Trump seem to think everything is fine. Meanwhile, families don’t know how they’ll feed their children and make rent, and family businesses are closing their doors.

Black-owned businesses have closed at twice the rate of white-owned businesses during this pandemic, and Black and Latino renters are more likely to be behind on their rent or mortgage.

Low-wage workers are more likely to remain out of work and more likely to be struggling to pay for food.

We should be rolling up our sleeves to invest in neighborhoods all over the country, and the small businesses that sustain them.

Instead, we’ve had another Trump appointee working to actually make it harder to invest in these communities, at a time when they need support the most.

For decades, redlining and government- and bank-sanctioned discrimination had left large parts of the country – often Black and brown communities and rural areas – with virtually no investment from banks.

People had dreams to start businesses, to build houses, to grow and support their communities – but they couldn’t get loans to do it. 

Even after Congress outlawed housing and lending discrimination based on race, whole communities struggled to get the loans they needed. Banks were happy to take Black and brown and low-income people’s deposits – and then lend that money out to wealthy investors and companies outside of the community.

Long after redlining and legal segregation officially ended, people living in largely Black and brown neighborhoods weren’t able to get mortgages to buy a home, because the bank just wasn’t making loans in that part of town.

Small farms and small businesses couldn’t get the loans they needed to grow.

That’s why we passed the Community Reinvestment Act, or CRA, to make it clear that banks have a responsibility serve all of the places where they do business – including low- and moderate-income areas.

The CRA is one of the foundational civil rights laws passed to address decades of explicit disinvestment, and begin to undo the legacy of redlining.

For more than 40 years, our government and banks alike have recognized in theory that banking shouldn’t just be about serving the people with six-figure salaries and big mortgages.

It’s about helping a family farm take out a loan or a bus driver buy their first home or a brother and sister open a corner store in a neighborhood where there’s nowhere to buy fresh groceries.

It’s also about listening to what the community needs and making it happen – like helping to finance a new affordable housing development or offering small loans so that people aren’t turning to payday lenders.

And it’s about investing in neighborhoods and borrowers who were locked out of the financial system based on who they were or where they were born.

The three entities that oversee our banking system – the OCC, the Federal Reserve, and the FDIC – acted together over those 40 years, so that there was one CRA for all banks to follow, and one set of expectations about serving customers and communities.  

But in May, the OCC threw that 40 years of progress out the window.

In the middle of a pandemic disproportionately harming Black and brown communities, Trump’s OCC unilaterally rewrote the CRA.

Just six weeks before the rule was finalized and in the early days of the pandemic, civil rights leaders, community development organizations, state and local officials, and banks themselves submitted over 7,500 comments on the OCC and FDIC’s proposed rewrite of the CRA.

The vast majority of commenters opposed the agencies’ proposal.

A coalition of civil rights leaders including the NAACP, the National Fair Housing Alliance, and Unidos US said the proposed rule invited “a return to discrimination against communities of color and low- and moderate-income neighborhoods.”

Twenty-two state attorneys general wrote that the proposal was “contrary to CRA’s purpose and text, will harm communities and the States, and should be withdrawn.”

And across my home state of Ohio, cities from Akron and Toledo, to Dayton and Cincinnati all wrote and passed resolutions opposing this plan.

Some in government – those not directly connected to the Trump Administration – listened to the people we serve. The FDIC heard the feedback and saw the financial pain of the pandemic and declined to move forward. The Federal Reserve didn’t join.

But the OCC plowed ahead. It ignored the thousands of civil rights groups and local nonprofits and banks who all told them their plan just wouldn’t work for low- and moderate-income communities.

Instead, the agency said, basically we know best. They think these Trump appointees in Washington know better than mayors and city councilmembers and local advocates and small businesses in Ohio and all over the country.

And the day after they announced they were ignoring the rest of the country and plowing ahead with this, Comptroller of the Currency Otting announced he would resign.

Since the rule was finalized, the Federal Reserve has set out a path for all three regulators to work together to create a CRA rule that will increase the focus on lending and investments and services in low- and moderate-income communities, and to small businesses and farms.

We should be investing in these communities that have been systematically excluded from sharing in our country’s prosperity for generations.

That means strengthening the CRA and listening to communities when they tell us what they need

But the OCC’s rule does the opposite.

They even acknowledged that there was widespread opposition from this rule, particularly from the communities that the CRA was meant to serve.

So it should be easy for my Republican colleagues to join us in voting to revoke the OCC’s rule, and to stand up for the underserved low- and moderate-income communities, rural communities, and communities of color who the CRA was meant to serve.

This is what the Senate should be doing – working to get our country through the worst crisis we’ve seen in our lifetimes, and investing in the communities getting hit the hardest.

Instead, Leader McConnell is using the final days before an election to jam through another judge who will carry out their corporate agenda that the voters keep rejecting. 

The Senate needs to get back to focusing on the people we’re here to serve and repeal the OCC’s misguided rule to gut the Community Reinvestment Act.

I urge my colleagues to support the Resolution so that we can get back on a path to strengthening the CRA and helping communities across the country.