[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[H.R. 9767 Introduced in House (IH)]
<DOC>
118th CONGRESS
2d Session
H. R. 9767
To make reforms to provide support for minority depository
institutions, community development financial institutions, and
minority lending institutions to promote and advance communities of
color through inclusive lending, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
September 23, 2024
Ms. Waters introduced the following bill; which was referred to the
Committee on Financial Services
_______________________________________________________________________
A BILL
To make reforms to provide support for minority depository
institutions, community development financial institutions, and
minority lending institutions to promote and advance communities of
color through inclusive lending, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Promoting and Advancing Communities
of Color Through Inclusive Lending Act''.
SEC. 2. STRENGTHENING DIVERSE AND MISSION-DRIVEN COMMUNITY FINANCIAL
INSTITUTIONS.
(a) Minority Lending Institution Set-Aside in Providing
Assistance.--
(1) In general.--Section 108 of the Riegle Community
Development and Regulatory Improvement Act of 1994 (12 U.S.C.
4707) is amended by adding at the end the following:
``(i) Minority Lending Institution Set-Aside in Providing
Assistance.--Notwithstanding any other provision of law, in providing
any assistance to community development financial institutions, the
Fund shall reserve 40 percent of such assistance for minority lending
institutions.''.
(2) Definitions.--Section 103 of the Riegle Community
Development and Regulatory Improvement Act of 1994 (12 U.S.C.
4702) is amended by adding at the end the following:
``(22) Minority lending institution.--The term `minority
lending institution' has the meaning given that term under
section 523(c) of division N of the Consolidated Appropriations
Act, 2021.''.
(b) Office of Minority Lending Institutions.--Section 104 of the
Riegle Community Development and Regulatory Improvement Act of 1994 (12
U.S.C. 4703) is amended by adding at the end the following:
``(l) CDFI Office of Minority Lending Institutions.--There is
established within the Fund an Office of Minority Lending Institutions,
which shall oversee assistance provided by the Fund to minority lending
institutions.''.
(c) Reporting on Minority Lending Institutions.--Section 117 of the
Riegle Community Development and Regulatory Improvement Act of 1994 (12
U.S.C. 4716) is amended by adding at the end the following:
``(g) Reporting on Minority Lending Institutions.--Each report
required under subsection (a) shall include a description of the extent
to which assistance from the Fund are provided to minority lending
institutions.''.
(d) Submission of Data Relating to Diversity by Community
Development Financial Institutions.--Section 104 of the Riegle
Community Development and Regulatory Improvement Act of 1994 (12 U.S.C.
4703), as amended by subsection (b), is further amended by adding at
the end the following:
``(m) Submission of Data Relating to Diversity.--
``(1) Definitions.--In this subsection--
``(A) the term `executive officer' has the meaning
given the term in section 230.501(f) of title 17, Code
of Federal Regulations, as in effect on the date of
enactment of this subsection; and
``(B) the term `veteran' has the meaning given the
term in section 101 of title 38, United States Code.
``(2) Submission of disclosure.--Each Fund applicant and
recipient shall provide the following:
``(A) Data, based on voluntary self-identification,
on the racial, ethnic, and gender composition of--
``(i) the board of directors of the
institution;
``(ii) nominees for the board of directors
of the institution; and
``(iii) the executive officers of the
institution.
``(B) The status of any member of the board of
directors of the institution, any nominee for the board
of directors of the institution, or any executive
officer of the institution, based on voluntary self-
identification, as a veteran.
``(C) Whether the board of directors of the
institution, or any committee of that board of
directors, has, as of the date on which the institution
makes a disclosure under this paragraph, adopted any
policy, plan, or strategy to promote racial, ethnic,
and gender diversity among--
``(i) the board of directors of the
institution;
``(ii) nominees for the board of directors
of the institution; or
``(iii) the executive officers of the
institution.
``(3) Annual report.--Not later than 18 months after the
date of enactment of this subsection, and annually thereafter,
the Fund shall submit to the Committee on Banking, Housing, and
Urban Affairs of the Senate and the Committee on Financial
Services of the House of Representatives, and make publicly
available on the website of the Fund, a report--
``(A) on the data and trends of the diversity
information made available pursuant to paragraph (2);
and
``(B) containing all administrative or legislative
recommendations of the Fund to enhance the
implementation of this title or to promote diversity
and inclusion within community development financial
institutions.''.
(e) Office of Diverse and Mission-Driven Community Financial
Institutions.--
(1) Establishment.--There is established within the
Department of the Treasury the Office of Diverse and Mission-
Driven Community Financial Institutions.
(2) Leadership.--The Office of Diverse and Mission-Driven
Community Financial Institutions shall be led by a Deputy
Assistant Secretary for Diverse and Mission-Driven Community
Financial Institutions, who shall be appointed by the Secretary
of the Treasury, in consultation with the Department of the
Treasury's Director of Office of Minority and Women Inclusion.
(3) Functions.--The Office of Diverse and Mission-Driven
Community Financial Institutions, pursuant to the direction of
the Secretary, shall have the authority--
(A) to monitor and issue reports regarding--
(i) community development financial
institutions, minority depository institutions,
and minority lending institutions; and
(ii) the role such institutions play in the
financial system of the United States,
including the impact they have on providing
financial access to low- and moderate-income
communities, communities of color, and other
underserved communities;
(B) to serve as a resource and Federal liaison for
current and prospective community development financial
institutions, minority depository institutions, and
minority lending institutions engaging with the
Department of the Treasury, the Community Development
Financial Institutions Fund (``CDFI Fund''), other
Federal Government agencies, including by providing
contact information, resources, technical assistance,
and other support for entities wishing--
(i) to become certified as a community
development financial institution, and maintain
the certification;
(ii) to obtain a banking charter, deposit
insurance, or otherwise carry on banking
activities in a safe, sound, and responsible
manner;
(iii) to obtain financial support through
private sector deposits, investments,
partnerships, and other means;
(iv) to expand their operations through
internal growth and acquisitions;
(v) to develop and upgrade their
technology, cybersecurity resilience,
compliance systems, data reporting systems, and
their capacity to support their communities,
including through partnerships with third-party
companies;
(vi) to obtain grants, awards, investments
and other financial support made available
through the CDFI Fund, the Board of Governors
of the Federal Reserve System, the Central
Liquidity Facility, the Federal Home Loan
Banks, and other Federal programs;
(vii) to participate as a financial
intermediary with respect to various Federal
and State programs and agencies, including the
State Small Business Credit Initiative and
programs of the Small Business Administration;
and
(viii) to participate in Financial Agent
Mentor-Protege Program of the Department of the
Treasury and other Federal programs designed to
support private sector partnerships;
(C) to provide resources to the public wishing to
learn more about minority depository institutions,
community development financial institutions, and
minority lending institutions, including helping the
Secretary implement the requirements under section 5,
publishing reports issued by the Office on the website
of the Department of the Treasury and providing
hyperlinks to other relevant reports and materials from
other Federal agencies;
(D) to provide policy recommendations to the
Secretary, the CDFI Fund, other relevant Federal
agencies, and Congress on ways to further strengthen
Federal support for community development financial
institutions, minority depository institutions, and
minority lending institutions;
(E) to assist the Secretary in carrying out the
Secretary's responsibilities under section 308 of the
Financial Institutions Reform, Recovery, and
Enforcement Act of 1989 (12 U.S.C. 1463 note) to
preserve and promote minority depository institutions
in consultation with the Chairman of the Board of
Governors of the Federal Reserve System, the
Comptroller of the Currency, the Chairman of the
National Credit Union Administration, and the
Chairperson of the Board of Directors of the Federal
Deposit Insurance Corporation; and
(F) to carry out other duties of the Secretary of
the Treasury required by this Act and the amendments
made by this Act, and to perform such other related
duties and authorities as may be assigned by the
Secretary.
(f) Strengthening Federal Efforts and Interagency Coordination To
Promote Diverse and Mission-Driven Community Financial Institutions.--
(1) Senior officials designated.--The Chairman of the Board
of Governors of the Federal Reserve System, the Comptroller of
the Currency, the Chairman of the National Credit Union
Administration, the Chairperson of the Board of Directors of
the Federal Deposit Insurance Corporation, and the Director of
the Bureau of Consumer Financial Protection shall each, in
consultation with their respective Director of Office of
Minority and Women Inclusion, designate a senior official to be
their respective agency's officer responsible for promoting
minority depository institutions, community development
financial institutions, and minority lending institutions,
including to fulfill obligations under section 308 of the
Financial Institutions Reform, Recovery, and Enforcement Act of
1989 (12 U.S.C. 1463 note) to preserve and promote minority
depository institutions.
(2) Interagency working group.--The Deputy Assistant
Secretary for Diverse and Mission-Driven Community Financial
Institutions shall regularly convene meetings, no less than
once a quarter, of an interagency working group to be known as
the ``Interagency Working Group to Promote Diverse and Mission-
Driven Community Financial Institutions'', which shall consist
of the senior officials designated by their respective agencies
under paragraph (1), along with the Director of the Community
Development Financial Institutions Fund and such other
government officials as the Deputy Assistant Secretary may
choose to invite, to examine and discuss the state of minority
depository institutions, community development financial
institutions, and minority lending institutions, and actions
the relevant agencies can take to preserve, promote, and
strengthen these institutions.
(3) Annual report to congress.--Not later than 1 year after
the date of the enactment of this subsection, and annually
thereafter, the Secretary of the Treasury, the Chairman of the
Board of Governors of the Federal Reserve System, the
Comptroller of the Currency, the Chairman of the National
Credit Union Administration, the Chairperson of the Board of
Directors of the Federal Deposit Insurance Corporation, and the
Director of the Bureau of Consumer Financial Protection shall
submit a joint report to the Committee on Financial Services of
the House of Representatives and the Committee on Banking,
Housing, and Urban Affairs of the Senate regarding the work
that has been done the prior year to preserve, promote, and
strengthen community development financial institutions,
minority depository institutions, and minority lending
institutions, along with any policy recommendations on actions
various government agencies and Congress should take to
preserve, promote, and strengthen community development
financial institutions, minority depository institutions, and
minority lending institutions.
SEC. 3. CAPITAL INVESTMENTS, GRANTS, AND TECHNOLOGY SUPPORT FOR MDIS
AND CDFIS.
(a) Authorization of Appropriation.--There is authorized to be
appropriated to the Emergency Capital Investment Fund $4,000,000,000.
(b) Conforming Amendments To Allow for Additional Purchases of
Capital.--Section 104A of the Riegle Community Development and
Regulatory Improvement Act of 1994 (12 U.S.C. 4703a) is amended--
(1) in subsection (c), by striking paragraph (2); and
(2) in subsection (e), by striking paragraph (2).
(c) Use of Funds for CDFI Financial and Technical Assistance.--
Section 104A of the Riegle Community Development and Regulatory
Improvement Act of 1994 (12 U.S.C. 4703a) is amended by adding at the
end the following:
``(p) Use of Funds for CDFI Financial and Technical Assistance.--
The Secretary may transfer amounts in the Emergency Capital Investment
Fund to the Fund for the purpose of providing financial and technical
assistance grants to community development financial institutions
certified by the Secretary.''.
(d) Technology Grants for MDIs and CDFIs.--Section 104A of the
Riegle Community Development and Regulatory Improvement Act of 1994 (12
U.S.C. 4703a), as amended by subsection (c), is further amended by
adding at the end the following:
``(q) Technology Grants for MDIs and CDFIs.--
``(1) Study and report on certain technology challenges.--
``(A) Study.--The Secretary shall carry out a study
on the technology challenges impacting minority
depository institutions and community development
financial institutions with respect to--
``(i) internal technology capabilities and
capacity of the institutions to process loan
applications and otherwise serve current and
potential customers through the internet,
mobile phone applications, and other tools;
``(ii) technology capabilities and capacity
of the institutions, provided in partnership
with third-party companies, to process loan
applications and otherwise serve current and
potential customers through the internet,
mobile phone applications, and other tools;
``(iii) cybersecurity; and
``(iv) challenges and solutions related to
algorithmic bias in the deployment of
technology.
``(B) Report.--Not later than 1 year after the date
of the enactment of this subsection, the Secretary
shall submit a report to the Committee on Financial
Services of the House of Representatives and the
Committee on Banking, Housing, and Urban Affairs of the
Senate that includes the results of the study required
under subparagraph (A).
``(2) Technology grant program.--
``(A) Program authorized.--The Secretary shall
carry out a technology grant program to make grants to
minority depository institutions and community
development financial institutions to address
technology challenges impacting such institutions.
``(B) Application.--To be eligible to be awarded a
grant under this paragraph, a minority depository
institution or community development financial
institution shall submit an application to the
Secretary at such time, in such manner, and containing
such information as the Secretary may require.
``(C) Use of funds.--A minority depository
institution or community development financial
institution that is awarded a grant under this
paragraph may use the grant funds to--
``(i) enhance or adopt technologies that--
``(I) shorten loan approval
processes;
``(II) improve customer experience;
``(III) provide additional services
to customers;
``(IV) facilitate compliance with
applicable laws, regulations, and
program requirements, including testing
to ensure that the use of technology
does not result in discrimination, and
helping to satisfy data reporting
requirements; and
``(V) help ensure privacy of
customer records and cybersecurity
resilience; or
``(ii) carry out such other activities as
the Secretary determines appropriate.
``(3) Funding.--The Secretary may use amounts in the
Emergency Capital Investment Fund to make grants under
paragraph (2), but not to exceed $250,000,000 in the
aggregate.''.
(e) Pilot Program for Establishing De Novo CDFIs and MDIs.--Section
104A of the Riegle Community Development and Regulatory Improvement Act
of 1994 (12 U.S.C. 4703a), as amended by subsections (c) and (d), is
further amended by adding at the end the following:
``(r) Pilot Program for Establishing De Novo CDFIs and MDIs.--
``(1) In general.--The Secretary of the Treasury, in
consultation with the Fund and the appropriate Federal banking
agencies, shall establish a pilot program to provide
competitive grants to a person for the purpose of providing
capital for such person to establish a minority depository
institution or a community development financial institution.
``(2) Application.--A person desiring a grant under this
subsection shall submit to the Secretary an application in such
form and containing such information as the Secretary
determines appropriate.
``(3) Disbursement.--Before disbursing grant amounts to a
person selected to receive a grant under this subsection, the
Secretary shall ensure that such person has received approval
from the appropriate Federal banking agency (or such other
Federal or State agency from whom approval is required) to
establish a minority depository institution or a community
development financial institution, as applicable.
``(4) Funding.--The Secretary may use amounts in the
Emergency Capital Investment Fund to make grants under
paragraph (2), but not to exceed $100,000,000 in the
aggregate.''.
(f) Guidance for Subchapter S and Mutual Banks.--Not later than 30
days after the date of enactment of this Act, the Board of Governors of
the Federal Reserve System and the Secretary shall issue guidance
regarding how Emergency Capital Investment Program investments (whether
made before or after the date of enactment of this Act) are considered
for purposes of various prudential requirements, including debt to
equity, leverage ratio, and double leverage ratio requirements with
respect to subchapter S and mutual bank recipients of such investments.
SEC. 4. SUPPORTING YOUNG ENTREPRENEURS PROGRAM.
Section 108 of the Riegle Community Development and Regulatory
Improvement Act of 1994 (12 U.S.C. 4707), as amended by section
2(a)(1), is further amended by adding at the end the following:
``(j) Supporting Young Entrepreneurs Program.--
``(1) In general.--The Fund shall establish a Supporting
Young Entrepreneurs Program under which the Fund may provide
financial awards to the community development financial
institutions that the Fund determines have the best programs to
help young entrepreneurs get the start up capital needed to
start a small business.
``(2) No matching requirement.--The matching requirement
under subsection (e) shall not apply to awards made under this
subsection.
``(3) Funding.--In carrying out this subsection, the Fund
may use--
``(A) amounts in the Emergency Capital Investment
Fund, but not to exceed $100,000,000 in the aggregate;
and
``(B) such other funds as may be appropriated by
Congress to the Fund to carry out the Supporting Young
Entrepreneurs Program.''.
SEC. 5. MAP OF MINORITY DEPOSITORY INSTITUTIONS AND COMMUNITY
DEVELOPMENT FINANCIAL INSTITUTIONS.
(a) In General.--The Secretary of the Treasury, in consultation
with the CDFI Fund and the Federal banking agencies, shall establish an
interactive, searchable map showing the geographic locations of the
headquarters and branch locations of minority depository institutions
and community development financial institutions that have been
certified by the Secretary. Such map shall also provide a link to the
website of each such minority depository institution and community
development financial institution.
(b) Definitions.--In this section:
(1) CDFI fund.--The term ``CDFI Fund'' means the Community
Development Financial Institutions Fund established under
section 104(a) of the Riegle Community Development and
Regulatory Improvement Act of 1994.
(2) Community development financial institution.--The term
``community development financial institution'' has the meaning
given in section 103 of the Riegle Community Development and
Regulatory Improvement Act of 1994.
(3) Federal banking agency.--The term ``Federal banking
agency''--
(A) has the meaning given in section 3 of the
Federal Deposit Insurance Act; and
(B) means the National Credit Union Administration.
(4) Minority depository institution.--The term ``minority
depository institution'' has the meaning given in section
308(b) of the Financial Institutions Reform, Recovery, and
Enforcement Act of 1989.
SEC. 6. REPORT ON CERTIFIED COMMUNITY DEVELOPMENT FINANCIAL
INSTITUTIONS.
Section 117(a) of the Riegle Community Development and Regulatory
Improvement Act of 1994 (12 U.S.C. 4716(a)) is amended--
(1) by striking ``The Fund'' and inserting the following:
``(1) In general.--The Fund'';
(2) by striking ``and the Congress'' and inserting ``, the
Congress, and the public''; and
(3) by adding at the end the following:
``(2) Report on certified community development financial
institutions.--The annual report required under paragraph (1)
shall include a report on community development financial
institutions (`CDFIs') that have been certified by the
Secretary of the Treasury, including a summary with aggregate
data and analysis, to the fullest extent practicable,
regarding--
``(A) a list of the types of organizations that are
certified as CDFIs, and the number of each type of
organization;
``(B) the geographic location and capacity of
different types of certified CDFIs;
``(C) the primary lines of business for different
types of certified CDFIs, as well as any secondary
lines of business;
``(D) human resources and staffing information for
different types of certified CDFIs, including--
``(E) the types of development services provided by
different types of certified CDFIs;
``(F) the target markets of different types of
certified CDFIs and the amount of products and services
offered by CDFIs to those target markets, including--
``(i) the number and amount of loans and
loan guarantees made in those target markets;
``(ii) the number and amount of other
investments made in those target markets; and
``(iii) the number and amount of
development services offered in those target
markets; and
``(G) such other information as the Director of the
Fund may determine necessary to promote transparency of
the impact of different types of CDFIs, while carrying
out this report in a manner that seeks to minimize data
reporting requirements from certified CDFIs when
feasible, including utilizing information gathered from
other regulators under section 104(l).''.
SEC. 7. CONSULTATION AND MINIMIZATION OF DATA REQUESTS.
Section 104 of the Riegle Community Development and Regulatory
Improvement Act of 1994 (12 U.S.C. 4703) is amended by adding at the
end the following:
``(l) Consultation and Minimization of Data Requests.--
``(1) In general.--In carrying out its duties, the Fund
shall--
``(A) periodically, and no less frequent than once
a year, consult with the applicable Federal regulator
of certified CDFIs and applicants to be a certified
CDFI (`applicants)'; and
``(B) seek to gather any relevant information on
certified CDFIs and applicants from the applicable
Federal regulator to minimize duplicative data
collection requests made by the Fund of certified CDFIs
and applicants and to expedite certification, re-
certification, or other relevant processes administered
by the Fund.
``(2) Applicable federal regulator defined.--In this
subsection, the term `applicable Federal regulator' means--
``(A) with respect to a certified CDFI or an
applicant that is regulated by both an appropriate
Federal banking agency and the Bureau of Consumer
Financial Protection, the Bureau of Consumer Financial
Protection;
``(B) with respect to a certified CDFI or an
applicant that is not regulated by the Bureau of
Consumer Financial Protection, the appropriate Federal
banking agency for such applicant; or
``(C) the Bureau of Consumer Financial Protection,
with respect to a certified CDFI or an applicant--
``(i) that is not regulated by an
appropriate Federal banking agency; and
``(ii) that offers or provides consumer
financial products or services (as defined in
section 1002 of the Consumer Financial
Protection Act of 2010 (12 U.S.C. 5481).''.
SEC. 8. ACCESS TO THE DISCOUNT WINDOW OF THE FEDERAL RESERVE SYSTEM FOR
MDIS AND CDFIS.
The Board of Governors of the Federal Reserve System shall
establish a process under which minority depository institutions and
community development financial institutions may have access to the
discount window, at the seasonal credit interest rate most recently
published on the Federal Reserve Statistical Release on selected
interest rates (daily or weekly).
SEC. 9. STUDY ON SECURITIZATION BY CDFIS.
(a) In General.--The Secretary of the Treasury, in consultation
with the Community Development Financial Institutions Fund and such
other Federal agencies as the Secretary determines appropriate, shall
carry out a study on--
(1) the use of securitization by CDFIs;
(2) any barriers to the use of securitization as a source
of liquidity by CDFIs; and
(3) any authorities available to the Government to support
the use of securitization by CDFIs to the extent it helps serve
underserved communities.
(b) Report.--Not later than the end of the 1-year period beginning
on the date of enactment of this Act, the Secretary shall issue a
report to the Committee on Financial Services of the House of
Representatives and the Committee on Banking, Housing, and Urban
Affairs of the Senate containing--
(1) all findings and determinations made in carrying out
the study required under subsection (a); and
(2) any legislative or administrative recommendations of
the Secretary that would promote the responsible use of
securitization to help CDFIs in reaching more underserved
communities.
(c) CDFI Defined.--The term ``CDFI'' has the meaning given the term
``community development financial institution'' under section 103 of
the Riegle Community Development and Regulatory Improvement Act of
1994.
<all>