H.R. 7900 — what changed
National Defense Authorization Act for Fiscal Year 2023
From Engrossed in House to Placed on Calendar Senate. 1 section amended between Engrossed in House and Placed on Calendar Senate.
Sec. 6612 Capital investments, grants, and technology support for MDIs and CDFIs
Authorization of appropriation— There is authorized to be appropriated to the Emergency Capital Investment Fund $4,000,000,000. Such funds may be used for administrative expenses of the Department of the Treasury.
Conforming amendments to allow for additional purchases of capital— Section 104A of the Riegle Community Development and Regulatory Improvement Act of 1994 (12 U.S.C. 4703a) is amended—
in subsection (c), by striking paragraph (2); and
in subsection (e), by striking paragraph (2).
Use of funds for CDFI financial and technical assistance— Section 104A of the Riegle Community Development and Regulatory Improvement Act of 1994 (12 U.S.C. 4703a) is amended by adding at the end the following:
“(p) Use of funds for CDFI financial and technical assistance—The Secretary shall transfer no less than $1,000,000,000 in the Emergency Capital Investment Fund to the Fund for the purpose of providing financial and technical assistance grants to community development financial institutions certified by the Secretary. The Fund shall provide such grants using a formula that takes into account criteria such as certification status, financial and compliance performance, portfolio and balance sheet strength, diversity of CDFI business model types, and program capacity.”
Technology grants for MDIs and CDFIs—
Study and report on certain technology challenges—
Study— The Secretary of the Treasury shall carry out a study on the technology challenges impacting minority depository institutions and community development financial institutions with respect to—
internal technology capabilities and capacity of the institutions to process loan applications and otherwise serve current and potential customers through the internet, mobile phone applications, and other tools;
technology capabilities and capacity of the institutions, provided in partnership with third party companies, to process loan applications and otherwise serve current and potential customers through the internet, mobile phone applications, and other tools;
cybersecurity; and
challenges and solutions related to algorithmic bias in the deployment of technology.
Report— Not later than 18 months after the date of the enactment of this subsection, the Secretary shall submit a report to the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate that includes the results of the study required under subparagraph (A).
Technology grant program—
renumbered
was (5)(3)(3)
Program authorized— The Secretary shall carry out a technology grant program to make grants to minority depository institutions and community development financial institutions to address technology challenges impacting such institutions.
renumbered
was (5)(3)(4)
Application— To be eligible to be awarded a grant under this paragraph, a minority depository institution or community development financial institution shall submit an application to the Secretary at such time, in such manner, and containing such information as the Secretary may require.
renumbered
was (5)(3)(5)
Use of funds— A minority depository institution or community development financial institution that is awarded a grant under this paragraph may use the grant funds to—
renumbered
was (5)(3)(5)(3)
enhance or adopt technologies that—
renumbered
was (5)(3)(5)(3)(2)
shorten loan approval processes;
renumbered
was (5)(3)(5)(3)(3)
improve customer experience;
renumbered
was (5)(3)(5)(3)(4)
provide additional services to customers;
renumbered
was (5)(3)(5)(3)(5)
facilitate compliance with applicable laws, regulations, and program requirements, including testing to ensure that the use of technology does not result in discrimination, and helping to satisfy data reporting requirements;
renumbered
was (5)(3)(5)(3)(6)
help ensure privacy of customer records and cybersecurity resilience; and
renumbered
was (5)(3)(5)(3)(7)
reduce the unbanked and underbanked population; or
renumbered
was (5)(3)(5)(4)
carry out such other activities as the Secretary determines appropriate.
Funding— The Secretary may use amounts in the Emergency Capital Investment Fund to implement and make grants under paragraph (2), but not to exceed $250,000,000 in the aggregate.
Definitions— In this subsection, the terms “community development financial institution” and “minority depository institution” have the meaning given those terms, respectively, under section 103 of the Riegle Community Development and Regulatory Improvement Act of 1994 (12 U.S.C. 4702).
Pilot program for establishing de novo CDFIs and MDIs—
In general— The Secretary of the Treasury, in consultation with the Fund and the appropriate Federal banking agencies, shall establish a pilot program to provide competitive grants to a person for the purpose of providing capital for such person to establish a minority depository institution or a community development financial institution.
Application— A person desiring a grant under this subsection shall submit to the Secretary an application in such form and containing such information as the Secretary determines appropriate.
Disbursement— Before disbursing grant amounts to a person selected to receive a grant under this subsection, the Secretary shall ensure that such person has received approval from the appropriate Federal banking agency (or such other Federal or State agency from whom approval is required) to establish a minority depository institution or a community development financial institution, as applicable.
Funding— The Secretary may use amounts in the Emergency Capital Investment Fund to implement and make grants under paragraph (2), but not to exceed $100,000,000 in the aggregate.
Definitions— In this subsection, the terms “appropriate Federal banking agency”, “community development financial institution”, “Fund”, and “minority depository institution” have the meaning given those terms, respectively, under section 103 of the Riegle Community Development and Regulatory Improvement Act of 1994 (12 U.S.C. 4702).
Guidance for subchapter S and mutual banks— Not later than 30 days after the date of enactment of this Act, the Board of Governors of the Federal Reserve System and the Secretary shall issue guidance regarding how Emergency Capital Investment Program investments (whether made before or after the date of enactment of this Act) are considered for purposes of various prudential requirements, including debt to equity, leverage ratio, and double leverage ratio requirements with respect to subchapter S and mutual bank recipients of such investments.
Collection of Data— Section 111 of the Riegle Community Development and Regulatory Improvement Act of 1994 (12 U.S.C. 4710) is amended—
by striking “The Fund” and inserting the following:
“(a) In general—The Fund”
by adding at the end the following:
“(b) Collection of certain data by CDFIs—Notwithstanding the Equal Credit Opportunity Act (15 U.S.C. 1691 et seq.)—
“(1) a community development financial institution may collect data described in section 701(a)(1) of that Act (15 U.S.C. 1691(a)(1)) from borrowers and applicants for credit for the sole purpose and exclusive use to ensure that targeted populations and low-income residents of investment areas are adequately served and to report the level of service provided to such populations and areas to the Fund; and
“(2) a community development financial institution that collects the data described in paragraph (1) shall not be subject to adverse action related to that collection by the Bureau of Consumer Financial Protection or any other Federal agency.”