The fight for economic equity has historically been won through bold commitments, and few tools have proven as transformative as the Community Reinvestment Act (CRA).

Born out of the fight against redlining, the CRA compels banks to do more than just collect deposits — it mandates them to reinvest in the very neighborhoods they serve, ensuring that low- and moderate-income communities see the benefits of their financial presence.

Passed in 1977, this pivotal legislation has laid the groundwork for Community Benefits Agreements (CBAs), the strongest tool at our disposal. CBAs outline commitments for banks to reinvest in the communities they serve. These investments can include initiatives such as increased lending to underserved communities, opening new bank branches, or, conversely, committing to not shutting them down. Additionally, under the CRA, banks are evaluated on their efforts to support low- and moderate-income (LMI) neighborhoods, which creates a strong incentive for them to engage in projects like affordable housing developments, small business lending, and community infrastructure. Such initiatives include the Burbank Avenue Project in Santa Rosa and Mechanics Bank’s Social Impact Bond, which was established to renovate homes and fight blight in Richmond, Calif.  

Why the CRA Matters Now More Than Ever

As the CRA turns 47, we reflect on what our country would look like without it – there would be reduced access to credit, continued redlining and a host of other negative consequences for neighborhoods of color and LMI communities.

The CRA is a critical law. However, despite its existence, some communities still face credit discrimination and modern-day redlining. To address these challenges, it’s important to not only defend and uphold the CRA but to also present innovative solutions to enhance its effectiveness for today’s realities.

That’s why we testified against the Capital One-Discover merger earlier this year. That’s why we have called out banks and their lobbyists (twice now) for filing legal challenges that undermine the purpose of the CRA. And, that’s why we are proposing a California-specific CRA that would create new reinvestment obligations for financial institutions that currently don’t have CRA obligations, such as state-chartered banks and credit unions, generate billions in funding for affordable housing, promote oversight and accountability of financial institutions by allowing the public to provide input on the performance of financial institutions.

How to Support the CRA and Current CBA Activity

Rise Economy’s work is deeply rooted in fighting for economic justice. Since our founding as the California Reinvestment Coalition in 1986, we have played a pivotal role in supporting the CRA and negotiating CBAs that hold banks accountable. In the past year, we’ve taken a step against fossil fuel financing and worked with banks to include commitments to end the financing of new fossil fuel extraction activities in their CBA agreements. 

To stay up to date with our other current bank advocacy work and merger accountability reporting, read Kevin Stein’s monthly Banking Rundown.

Take a deeper dive into our CBAs over the years. 

A Vision for a More Promising 47 Years

The CRA’s legacy of promoting economic equity and addressing segregation in communities remains more relevant than ever. Over nearly five decades, the CRA has empowered local organizations to secure transformative agreements with banks that have reinvested billions into affordable housing, small business growth, and community development. From projects like the aforementioned Burbank Avenue Project and Mechanics Bank’s $3 million Social Impact Bond to countless other community benefits, the CRA continues to be a driving force for progress. 

As we look toward the next 47 years, Rise Economy remains committed to defending and strengthening this vital law, ensuring that it continues to provide benefits for BIPOC and low-income communities across California and beyond.