Independent Banker - July 2022 - 41

2011 and were four times more likely
to operate offi ces in rural counties. "
Discriminatory/predatory lending.
ICBA also pointed out that despite
industry and branch consolidation by
the largest banks, community banks
have maintained a presence in the
overwhelming majority of African
American-majority communities
and Hispanic American-majority
communities over the past three
years. Community banks also
originated more than 40% of
Paycheck Protection Program (PPP)
loans to minority small business
borrowers, more than any other type
of lender.
Manufactured housing.
Community banks maintain lending
to minority and low- to moderateincome
borrowers, fi nancing more
of these loans than other lenders.
In 2020, community banks made
97% of all low- and moderateincome
(LMI) loans and 99% of
all manufactured housing loans to
minority borrowers.
ICBA recommendations
for helping rural America
Pass the ECORA Act. The bipartisan
Enhancing Credit Opportunities
for Rural America Act (ECORA Act
H.R. 1977 and S. 2202) would give
community banks tax benefi ts like
those the Farm Credit System (FCS)
and credit unions receive. It would
exempt interest income to banks from
agricultural real estate loans and
rural home loans (in communities
with 2,500 or fewer residents).
The ECORA Act would allow
community banks to provide lower
interest rates on these loans and
allow fi nancially stressed farmers to
qualify for land loans or refi nance
existing farm real estate loans. Lower
mortgage payments would also
Tax burdens on banking and rural sectors make
it harder for rural businesses and citizens to
access low-cost credit. These same burdens
drive community bank consolidation.
help attract more people to smaller
rural communities.
Enhance the farm bill's rural safety
net. ICBA supports increases to
farm, housing and rural development
guaranteed loan programs,
including increasing guaranteed
farm operating and ownership
programs to a threshold of at least
$2.5 million versus the current
$1.825 million limit.
This would provide enough
capital for family, young, beginning,
small and minority and socially
disadvantaged farmers to start or
expand farming operations. ICBA
also urges that community banks be
able to participate in any program to
help resolve " heirs' property " legal
title questions.
Require credit unions to comply
with the Community Reinvestment
Act (CRA). The CFPB should urge the
administration to mandate that credit
unions comply with CRA.
Prohibit credit unions from
acquiring community banks. The
U.S. banking sector has lost more
than 100 community banks from
large credit unions acquiring smaller
community banks. This happens due
to lax regulation and credit unions
leveraging their tax benefi ts to infl ate
the purchase prices of community
banks above book value.
Don't let the FCS cherry-pick
loans. The FCS uses its status as a
government-sponsored enterprise
(GSE) to off er below-market rates
to the largest, fi nancially strongest
farm borrowers. This destabilizes
community bank portfolios,
driving community banks out of
agricultural lending and accelerating
bank consolidation.
ICBA will continue to reach out
to the CFPB to discuss solutions to
better the lives of rural Americans.
We'll connect the CFPB with members
of ICBA's Agriculture-Rural America
Committee to share the views of rural
bankers across America.
By sharing these stories, we can
emphasize that community banks
are providing solutions to the
issues raised by the CFPB. And with
better regulatory and tax policies,
community banks can preserve
the hope of a brighter future for
rural America. 
Mark K. Scanlan (mark.scanlan@
icba.org) is senior vice president
of agriculture and rural policy
for ICBA.
independentbanker.org Q 41
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Independent Banker - July 2022

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