WASHINGTON - Rep. Floyd Flake, D-N.Y., praised President Clinton for having "brought us to the table" of community development, but said his own bill would make more credit available more quickly to low-income communities.
Rep. Flake and Rep. Jim Leach, R-Iowa, last week introduced legislation that would fund community development banks also provide financial incentives to commercial banks that lend to distressed communities.
Part of the money would be used to fund the Bank Enterprise Act, a law that gives banks a rebate on deposit insurance premiums for certain types of lending activities.
Bonus for Good Grades
The bill would mandate performance-based standards for the Community Reinvestment Act, and give banks with a three-year record of outstanding ratings on CRA a "safe harbor" on CRA challenges.
"We are trying to solve the problems of the Third World nation within our own borders," said Rep. Flake.
He said his bill complements the President's approach, but the bill differs in major respects from the White House bill. The White House proposal would not permit financial incentives for most commercial banks, thrifts, or credit unions, and it puts off CRA issues.
"The goal of this is to make the President look as good as possible," said Rep. Leach.