WFAA, May 9, 2021, Local governments deposit millions of tax dollars in banks. Some say it’s time they demanded racial equity in return.
Decades after the term “redlining” was coined, an ongoing WFAA investigation has shown that many banks are still choosing not to make loans, or do meaningful business, in low-income parts of town, even though federal law mandates they act equitably and don’t discriminate.
Since last fall, our “Banking Below 30” series has explored how banks extend credit to richer, whiter customers north of Interstate 30 and withhold it from low- to moderate-income ones to the south.
Now, it’s time to talk about a solution. It’s called a responsible banking ordinance.
You may not realize it, but local governments keep your tax dollars in banks – the same banks we all use. A responsible banking ordinance requires a local government to evaluate how well a bank serves all its citizens, from high- to low-income, before choosing to do business with the bank.
The concept was developed in part by the National Community Reinvestment Coalition which advocates for greater reinvestment by banks in low- to moderate-income neighborhoods and has drafted model legislation that local governments can work from.
