HR 7978 — Promoting and Advancing Communities of Color Through Inclusive Lending Act

For purposes of this subchapter, the following definitions shall apply: (1) Administrator The term “Administrator” means the Administrator of the Fund appointed under section 4703(b) of this title. (2) Appropriate Federal banking agency The term “appropriate Federal banking agency” has the same meaning as in section 1813 of this title, and also includes the National Credit Union Administration Board with respect to insured credit unions. (3) Affiliate The term “affiliate” has the same meaning as in section 1841(k) of this title. (4) Board The term “Board” means the Community Development Advisory Board established under section 4703(d) of this title. (5) Community development financial institution (A) In general The term “community development financial institution” means a person (other than an individual) that— (i) has a primary mission of promoting community development; (ii) serves an investment area or targeted population; (iii) provides development services in conjunction with equity investments or loans, directly or through a subsidiary or affiliate; (iv) maintains, through representation on its governing board or otherwise, accountability to residents of its investment area or targeted population; and (v) is not an agency or instrumentality of the United States, or of any State or political subdivision of a State. (B) Conditions for qualification of holding companies (i) Consolidated treatment A depository institution holding company may qualify as a community development financial institution only if the holding company and the subsidiaries and affiliates of the holding company collectively satisfy the requirements of subparagraph (A). (ii) Exclusion of subsidiary or affiliate for failure to meet consolidated treatment rule No subsidiary or affiliate of a depository institution holding company may qualify as a community development financial institution if the holding company and the subsidiaries and affiliates of the holding company do not collectively meet the requirements of subparagraph (A). (C) Conditions for subsidiaries No subsidiary of an insured depository institution may qualify as a community development financial institution if the insured depository institution and its subsidiaries do not collectively meet the requirements of subparagraph (A). (6) Community partner The term “community partner” means a person (other than an individual) that provides loans, equity investments, or development services, including a depository institution holding company, an insured depository institution, an insured credit union, a nonprofit organization, a State or local government agency, a quasi-governmental entity, and an investment company authorized to operate pursuant to the Small Business Investment Act of 1958 [15 U.S.C. 661 et seq.]. (7) Community partnership The term “community partnership” means an agreement between a community development financial institution and a community partner to provide development services, loans, or equity investments, to an investment area or targeted population. (8) Depository institution holding company The term “depository institution holding company” has the same meaning as in section 1813 of this title. (9) Development services The term “development services” means activities that promote community development and are integral to lending or investment activities, including— (A) business planning; (B) financial and credit counseling; and (C) marketing and management assistance. (10) Fund The term “Fund” means the Community Development Financial Institutions Fund established under section 4703(a) of this title. (11) Indian reservation The term “Indian reservation” has the same meaning as in section 1903(10) of title 25, and shall include land held by incorporated Native groups, regional corporations, and village corporations, as defined in or established pursuant to the Alaska Native Claims Settlement Act [43 U.S.C. 1601 et seq.], public domain Indian allotments, and former Indian...

(a) Establishment (1) In general There is established a corporation to be known as the Community Development Financial Institutions Fund that shall have the duties and responsibilities specified by this subchapter and subchapter II of this chapter. The Fund shall have succession until dissolved. The offices of the Fund shall be in Washington, D.C. The Fund shall not be affiliated with or be within any other agency or department of the Federal Government. (2) Wholly owned Government corporation The Fund shall be a wholly owned Government corporation in the executive branch and shall be treated in all respects as an agency of the United States, except as otherwise provided in this subchapter. (b) Management of Fund (1) Appointment of Administrator The management of the Fund shall be vested in an Administrator, who shall be appointed by the President. The Administrator shall not engage in any other business or employment during service as the Administrator. (2) Chief financial officer The Administrator shall appoint a chief financial officer, who shall have the authority and functions of an agency Chief Financial Officer under section 902 of title 31. In the event of a vacancy in the position of the Administrator or during the absence or disability of the Administrator, the chief financial officer shall perform the duties of the position of Administrator. (3) Other officers and employees The Administrator may appoint such other officers and employees of the Fund as the Administrator determines to be necessary or appropriate. (4) Expedited hiring During the 2-year period beginning on September 23, 1994, the Administrator may— (A) appoint and terminate the individuals referred to in paragraphs (2) and (3) without regard to the civil service laws and regulations; and (B) fix the compensation of the individuals referred to in paragraph (3) without regard to the provisions of chapter 51 and subchapter III of chapter 53 of title 5 relating to classification of positions and General Schedule pay rates, except that the rate of pay for such individuals may not exceed the rate payable for level V of the Executive Schedule under section 5316 of such title. (c) General powers In carrying out the functions of the Fund, the Administrator— (1) shall have all necessary and proper authority to carry out this subchapter and subchapter II of this chapter; (2) shall have the power to adopt, alter, and use a corporate seal for the Fund, which shall be judicially noticed; (3) may adopt, amend, and repeal bylaws, rules, and regulations governing the manner in which business of the Fund may be conducted and such rules and regulations as may be necessary or appropriate to implement this subchapter and subchapter II of this chapter; (4) may enter into, perform, and enforce such agreements, contracts, and transactions as may be deemed necessary or appropriate to the conduct of activities authorized under this subchapter and subchapter II of this chapter; (5) may determine the character of and necessity for expenditures of the Fund and the manner in which they shall be incurred, allowed, and paid; (6) may utilize or employ the services of personnel of any agency or instrumentality of the United States with the consent of the agency or instrumentality concerned on a reimbursable or nonreimbursable basis; and (7) may execute all instruments necessary or appropriate in the exercise of any of the functions of the Fund under this subchapter and subchapter II of this chapter and may delegate to the officers of the Fund such of the powers and responsibilities of the Administrator as the Administrator deems necessary or appropriate for the administration of the Fund. (d) Advisory Board (1) Establishment There is established an advisory board to the Fund to be known as the Community Development Advisory Board, which shall be operated in accordance with the provisions of chapter 10 of title 5, except that section 1013 of title 5 does not apply to the Board. (2) Me...

(a) Definitions In this section— (1) the term “bank holding company” has the meaning given the term in section 1841 of this title; (2) the term “eligible institution” means any low- and moderate-income community financial institution that is eligible to participate in the Program; (3) the term “Emergency Capital Investment Fund” means the Emergency Capital Investment Fund established under subsection (b); (4) the term “low- and moderate-income community financial institution” means any financial institution that is— (A) (i) a community development financial institution; or (ii) a minority depository institution; and (B) (i) an insured depository institution that is not controlled by a bank holding company or savings and loan holding company that is also an eligible institution; (ii) a bank holding company; (iii) a savings and loan holding company; or (iv) a federally insured credit union; (5) the term “minority” means any Black American, Native American, Hispanic American, Asian American, Native Alaskan, Native Hawaiian, or Pacific Islander; (6) the term “minority depository institution” means an entity that is— (A) a minority depository institution, as defined in section 308 of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 1463 note); or (B) considered to be a minority depository institution by— (i) the appropriate Federal banking agency; or (ii) the National Credit Union Administration, in the case of an insured credit union; or (C) listed in the Federal Deposit Insurance Corporation’s Minority Depository Institutions List published for the Third Quarter 2020.1 (7) the term “Program” means the Emergency Capital Investment Program established under subsection (b); (8) the term “savings and loan holding company” has the meaning given the term under section 1467a(a) of this title; and (9) the “Secretary” means the Secretary of the Treasury. (b) Establishment (1) Fund established There is established in the Treasury of the United States a fund to be known as the “Emergency Capital Investment Fund”, which shall be administered by the Secretary. (2) Program authorized The Secretary is authorized to establish an emergency program known as the “Emergency Capital Investment Program” to support the efforts of low- and moderate-income community financial institutions to, among other things, provide loans, grants, and forbearance for small businesses, minority-owned businesses, and consumers, especially in low-income and underserved communities, including persistent poverty counties, that may be disproportionately impacted by the economic effects of the COVID–19 pandemic, by providing direct and indirect capital investments in low- and moderate-income community financial institutions consistent with this section. (c) Purchases (1) In general Subject to paragraph (2), the Emergency Capital Investment Fund shall be available to the Secretary, without further appropriation or fiscal year limitation, for the costs of purchases (including commitments to purchase), and modifications of such purchases, of preferred stock and other financial instruments from eligible institutions on such terms and conditions as are determined by the Secretary in accordance with this section. (2) Purchase limit The aggregate amount of purchases pursuant to paragraph (1) may not exceed $9,000,000,000. (d) Application (1) Acceptance The Secretary shall begin accepting applications for capital investments under the Program not later than the end of the 30-day period beginning on December 27, 2020. (2) Consultation with regulators For each eligible institution that applies to receive a capital investment under the Program, the Secretary shall consult with the appropriate Federal banking agency or the National Credit Union Administration, as applicable, to determine whether the eligible institution may receive such capital investment. (3) Eligibility (A) In general Only low- and moderate-income community financial institutions...

(a) Forms of assistance (1) In general The Fund may provide— (A) financial assistance through equity investments, deposits, credit union shares, loans, and grants; and (B) technical assistance— (i) directly; (ii) through grants; or (iii) by contracting with organizations that possess expertise in community development finance, without regard to whether the organizations receive or are eligible to receive assistance under this subchapter. (2) Equity investments (A) Limitation on equity investments The Fund shall not own more than 50 percent of the equity of a community development financial institution and may not control the operations of such institution. The Fund may hold only transferable, nonvoting equity investments in the institution. Such equity investments may provide for convertibility to voting stock upon transfer by the Fund. (B) Fund deemed not to control Notwithstanding any other provision of law, the Fund shall not be deemed to control a community development financial institution by reason of any assistance provided under this subchapter for the purpose of any other applicable law to the extent that the Fund complies with subparagraph (A). Nothing in this subparagraph shall affect the application of any Federal tax law. (3) Deposits Deposits made pursuant to this section in an insured community development financial institution shall not be subject to any requirement for collateral or security. (4) Limitations on obligations Direct loan obligations may be incurred by the Fund only to the extent that appropriations of budget authority to cover their cost, as defined in section 661a(5) of title 2, are made in advance. (b) Uses of financial assistance (1) In general Financial assistance made available under this subchapter may be used by assisted community development financial institutions to serve investment areas or targeted populations by developing or supporting— (A) commercial facilities that promote revitalization, community stability, or job creation or retention; (B) businesses that— (i) provide jobs for low-income people or are owned by low-income people; or (ii) enhance the availability of products and services to low-income people; (C) community facilities; (D) the provision of basic financial services; (E) housing that is principally affordable to low-income people, except that assistance used to facilitate homeownership shall only be used for services and lending products— (i) that serve low-income people; and (ii) that— (I) are not provided by other lenders in the area; or (II) complement the services and lending products provided by other lenders that serve the investment area or targeted population; and (F) other businesses and activities deemed appropriate by the Fund. (2) Limitations No assistance made available under this subchapter may be expended by a community development financial institution (or an organization receiving assistance under section 4712 of this title) to pay any person to influence or attempt to influence any agency, elected official, officer, or employee of a State or local government in connection with the making, award, extension, continuation, renewal, amendment, or modification of any State or local government contract, grant, loan, or cooperative agreement (as such terms are defined in section 1352 of title 31). (c) Uses of technical assistance (1) Types of activities Technical assistance may be used for activities that enhance the capacity of a community development financial institution, such as training of management and other personnel and development of programs and investment or loan products. (2) Availability of technical assistance The Fund may provide technical assistance, regardless of whether or not the recipient also receives financial assistance under this section. (d) Amount of assistance (1) In general Except as provided in paragraph (2), the Fund may provide not more than $5,000,000 of assistance, in the aggregate, during any 3-year period to any 1 com...

(a) Annual report by Fund The Fund shall conduct an annual evaluation of the activities carried out by the Fund and the community development financial institutions and other organizations assisted pursuant to this subchapter, and shall submit a report of its findings to the President and the Congress not later than 120 days after the end of each fiscal year of the Fund. The report shall include financial statements audited in accordance with subsection (f). (b) Optional studies The Fund may conduct such studies as the Fund determines necessary to further the purpose of this subchapter and to facilitate investment in distressed communities. The findings of any studies conducted pursuant to this subsection shall be included in the report required by subsection (a). (c) Native American lending study (1) In general The Fund shall conduct a study on lending and investment practices on Indian reservations and other land held in trust by the United States. Such study shall— (A) identify barriers to private financing on such lands; and (B) identify the impact of such barriers on access to capital and credit for Native American populations. (2) Report Not later than 12 months after the date on which the Administrator is appointed, the Fund shall submit a report to the President and the Congress that— (A) contains the findings of the study conducted under paragraph (1); (B) recommends any necessary statutory and regulatory changes to existing Federal programs; and (C) makes policy recommendations for community development financial institutions, insured depository institutions, secondary market institutions, and other private sector capital institutions to better serve such populations. (d) Investment, governance, and role of Fund Thirty months after the appointment and qualification of the Administrator, the Comptroller General of the United States shall submit to the President and the Congress a study evaluating the structure, governance, and performance of the Fund. (e) Consultation In the conduct of the studies required under this section, the Fund shall consult, as appropriate, with the Comptroller of the Currency, the Federal Deposit Insurance Corporation, the Board of Governors of the Federal Reserve System, the Federal Housing Finance Agency, the Farm Credit Administration, the Director of the Office of Thrift Supervision, the National Credit Union Administration Board, Indian tribal governments, community reinvestment organizations, civil rights organizations, consumer organizations, financial organizations, and such representatives of agencies or other persons, at the discretion of the Fund. (f) Examination and audit The financial statements of the Fund shall be audited in accordance with section 9105 of title 31, except that audits required by section 9105(a) of such title shall be performed annually.