US Codex
Bill
Notes

Title V — Public Bank Development Programs

H.R. 8721 · 116th Congress · Oct 30, 2020 · Lineage

V Public Bank Development Programs

501. Public bank grant program

(a)
Program established—
(1)
In general— The Board of Governors shall, jointly with the Secretary, carry out a grant program to make grants to covered banks, or persons seeking to become or in the process of becoming covered banks, to carry out the activities described in subsection (b).
(2)
Considerations for eligibility—
(A)
Required considerations— When determining eligibility for grants under this section, the Board of Governors and the Secretary shall consider, among other factors, the extent to which a grant applicant has established an appropriate degree of community involvement and oversight, including dedicated community representation on the governing board, and evidence of support or commitment from community representative organizations.
(B)
Prohibited consideration— When determining eligibility for grants under this section, the Board of Governors and the Secretary may not consider the budgetary or financial health of the entity that wholly owns or controls a covered bank.
(b)
Use of funds— An entity that receives a grant under this section may use the grant funds—
(1)
to carry out activities related to bank formation, chartering, and regulatory compliance;
(2)
for capitalization;
(3)
to make payments and develop financial market infrastructure;
(4)
to carry out activities related to information and communications technology;
(5)
to support operations;
(6)
to cover unexpected losses; and
(7)
to carry out such other activities as the Board of Governors and the Secretary determine appropriate.
(c)
Matching funds— The Board of Governors and the Secretary may not require that an entity that receives a grant under this section provide matching funds with respect to such grant.

502. Public bank incubator program

(a)
In general— The Board of Governors shall establish an incubator program to provide technical and technological assistance to persons seeking to be chartered by the Board of Governors under section 101 or to obtain a certificate of Federal recognition under section 102.
(b)
Application— The Board of Governors, in coordination with the Secretary, the Corporation, and the Commission, shall establish a single application and review process for persons seeking to—
(1)
be federally chartered under section 101;
(2)
obtain a certificate of Federal recognition under section 102;
(3)
become a public member bank;
(4)
obtain a license to issue federally-recognized public securities under section 201;
(5)
obtain public deposit insurance pursuant to section 301 or from a Corporation-approved alternative provider; and
(6)
apply for a grant under section 401.

503. Community development grant program

(a)
Reasonable efforts To coordinate— Covered banks shall, where and as appropriate, make reasonable efforts to coordinate activities with community development financial institutions, minority deposit institutions, and credit unions to promote community development and ensure community-oriented financial services are universal and comprehensively include historically excluded and marginalized groups.
(b)
Grants for coordination— The Board of Governors shall, jointly with the Secretary, award grants to covered banks, community development financial institutions, minority deposit institutions, and credit unions to facilitate coordination of activities under subsection (a).
(c)
Definitions— In this section:
(1)
Community development financial institution— The term community development financial institution has the meaning given the term in section 103(5) of the Riegle Community Development and Regulatory Improvement Act of 1994 (12 U.S.C. 4702(5)).
(2)
Credit union— The term “credit union” means a Federal credit union or a State credit union (as such terms are defined in section 101 of the Federal Credit Union Act (12 U.S.C. 1752)).
(3)
Minority deposit institution— The term minority deposit institution has the meaning given the term in section 308(b)(1) of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 1463(b)(1)).

504. Treatment of funding

Any expenses incurred by the Board of Governors under this title shall be recorded—
(1)
in an account to be known as the “Special Public Bank Development Programs” established at the Federal Reserve Bank of New York; and
(2)
as a deferred asset (as described in section 11.96 of the Financial Accounting Manual for Federal Reserve Banks, as in effect on the date of the enactment of this Act) and maintained separately from the balance sheet of the Federal Reserve Bank of New York and the Federal Reserve System, so as to not reduce or impact the calculation of total income or revenue generated by the Federal Reserve System, or otherwise reduce the total amount of net operating profits to be made available for remittance to the Treasury on an ongoing basis.