The Community Reinvestment Act Is At Risk

In 2023, regulators finalized a rule meant to strengthen the Community Reinvestment Act (CRA), a landmark 1977 law that requires banks to meet the credit needs of the communities where they do business, including low- and moderate-income neighborhoods. Banks sued, and a federal judge in Texas blocked that rule from taking effect in 2024. Instead of continuing to fight in court, the OCC and FDIC, under the Trump Administration, dropped their appeal and wrote and released a new proposal on August 12, 2026. Under the new proposal, banks of all sizes would face lighter scrutiny and no longer require certain community development evaluations. According to the National Community Reinvestment Coalition (NCRC), Minnesota would be hit especially hard, eliminating these evaluations for 50 out of 107 banks.  

Eliminating or reducing the community development test threatens incentives for banks to invest in affordable housing and economic development through the Low-Income Housing Tax Credit (LIHTC), the New Markets Tax Credit (NMTC), grants to non-profits, and other community development programs.   

The Bottom Line: This proposal shrinks the number of banks held accountable to underserved communities, weakens the specific protections that targeted the most disadvantaged places, and reduces the data needed to catch discrimination. These changes land hardest on the communities CRA was written to protect, low-to-moderate income neighborhoods, communities of color, rural areas, and (with one exception for Tribal lands) Native communities.  

**Note: Please add a personal message to your email, especially if you are able to mention an affordable housing or economic development project in your community. Nearly all community development projects have some sort of bank partnership investment to make the project possible, either directly or through a non-profit organization.