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The Color of Money

Editorials and letters


Let Atlanta bank on fair lending


The Atlanta Constitution

Published March 9, 1989, Editorial Page, Page A18

Copyright 1989, The Atlanta Journal-Constitution


Last May, City Council President Marvin Arrington established the Fair Lending Practices Action Committee in response to this newspaper's series, "The Color of Money," which charged Atlanta lending institutions with failing to provide black neighborhoods with equitable access to mortgage loans. The committee's report, now in final form, is due to be presented to Mr. Arrington by March 15. A round of applause is in order.

The committee went beyond mortgage lending per se to recommend a full-scale infusion of banking activity into disfavored areas of the city. The recommendations include provision of consumer and insurance services as well as small business and development loans. They envision adapting banking culture to the circumstances of poor and black communities. On the mortgage front, the committee proposes that over 10 years all Atlanta financial institutions join in committing $500 million in loans to responsible would-be homeowners who would not qualify under present lending arrangements.

Some recommended steps are already being taken by area banks, but at a time when the Supreme Court is doing away with mandated affirmative action programs and minority set-asides, it is essential that comprehensive programs of this kind be set up to assure all citizens an equal economic opportunity.

The most serious question about the report is what will be done to see that i ts recommendations are put into effect. A few sanctions are proposed that will require governmental action. For example, the committee has urged that the city and other local governments withdraw all their funds from banks which fail to live up to the spirit and letter of its home loan recommendations.

The report's success, however, will fundamentally depend upon the enlightened self-interest of the financial institutions themselves -- and their desire to maintain their good name in the community. What is needed is a mechanism for publicly monitoring compliance.

At its last meeting in February, committee members voted to recommend that a new committee be established to do the job. Lest their noble creation die upon the shelf, Mr. Arrington should act to ensure that some such body -- adequately staffed and funded -- is authorized both to receive regular reports from the financial institutions and to issue findings of compliance and non-compliance.

And to help the process along, pledges of support for the report, and for the monitoring mechanism, should be tendered posthaste by Mayor Andrew Young as well as by his would-be successors.

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