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Community development under the CRA
With political turnovers, technological advances and demographic shifts, it sometimes seems like change is the only constant in community development. In this issue of CommunityDividend, we explore a variety of subjects that reflect this idea—locally, nationally and internationally.
Our cover story explores the national Community Reinvestment Act, or the CRA. This landmark 1977 legislation requires lending institutions to invest in low- or moderate-income communities. In response to emerging issues and needs, the CRA was revised in 1995 and will be reviewed again in 2002. To foster discussion of the law before further changes are proposed, our story outlines the definition of community development under this regulation.
As the community development field evolves and shifts, new topics constantly emerge. Two additional features in this issue highlight such topics. In an excerpt from a speech delivered this spring, Federal Reserve Governor Edward M. Gramlich addresses the widespread problem of abusive and deceptive lending practices, or "predatory lending." Gramlich acknowledges the difficulty of defining predatory lending and urges education as the best defense against these practices. A feature by Buzz Roberts, vice president for policy at Local Initiatives Support Corporation, provides an introduction to the New Markets Tax Credit program. This exciting new community development tool promises to fuel $15 billion in community development investment over the next six years.
Changes on the other side of the globe are the focus of our last feature, which relates former Community Affairs Analyst Thomas Moore's experiences as a consultant to a new lending institution in Mongolia. The article includes a brief overview of Mongolia's history and explores the challenges that the nation faces as it moves from Soviet-style market restrictions to a free-market economy.
On the final pages of this issue, we focus on a change that's very close to home. In "A Conversation with . . .", we bid farewell to Community Affairs Officer JoAnne Lewellen, who recently left the Minneapolis Fed. In an interview conducted shortly before she left, Lewellen discusses the CRA and other topics and reflects on the evolution and accomplishments of Community Affairs during her tenure with the Federal Reserve System.
As this issue of Community Dividenddemonstrates, changes in the community development field often provide opportunities for progress and reflection. We hope the information presented here will help you embrace any changes you might encounter as you pursue your development efforts.
