H.R. 1066 Corrects Negative Consequences
Brought About by Regulatory Relief Act

WASHINGTON, DC - May 27, 2007 - NACEDA is joining its sister groups in affordable housing/community development in signing onto a support letter for the Senate passage of H.R. 1066 (Depository Institution Community Development Investments Enhancement Act.) This letter is being sent to members of the Senate Committee on Banking, Housing and Urban Affairs. H.R. 1066 revises language for permissible public welfare investments by banks in the National Bank Act and the Federal Reserve Act, last enacted in the Regulatory Relief Act. H.R. 1066 passed the House in February 2007.

The Regulatory Relief Act authorized banks to make investments promoting public welfare by benefiting primarily low- and moderate-income (LMI) communities or families by providing housing, services, or jobs. However, the Act has negative consequences. Language disqualifies banks from making such direct investments that: revitalize designated disaster areas that do not serve communities that were LMI prior to the disaster; help underserved or distressed rural communities that do not meet the LMI; utilize New Markets Tax Credits in high poverty census tracts where incomes do not meet LMI; or provide mixed-income affordable housing in areas targeted for revitalization or government-sponsored housing initiatives. H.R. 1066 remedies the restrictions applicable to banks' direct public welfare investments and restores the investment authority permitted prior to the passage of the Regulatory Relief Act.

Please click here to see the full letter and list of co-signers.