McConnell Bill to Help Rural Communities in Kentucky Passes Congress

WASHINGTON, D.C. – U.S. Senate Majority Leader Mitch McConnell praised passage of legislation he introduced to help rural communities harmed by Obama Administration policies that restrict access to rural lending opportunities. His legislation was also co-sponsored by Senators Dean Heller (R-NV), Shelley Moore Capito (R-WV), Mike Rounds (R-SD) and Deb Fischer (R-NE). Representative Andy Barr (R-KY-6) also introduced similar legislation in the House of Representatives, where the measure passed earlier this year by a vote of 401-1. The bill now goes to the President for his signature.

The Consumer Financial Protection Bureau (CFPB) – created by the Dodd-Frank Wall Street Reform Act of 2010 – permits certain rural lending practices in areas it deems “rural” or “underserved.”  However, as many rural communities have noted, the CFPB’s original definition of rural unfairly excluded a significant number of demonstrably rural areas and neglected to provide rural communities with any input in the process.  While the CFPB recently undertook efforts to revise its definition, it once again, neglected to allow input from rural communities themselves.

The Helping Expand Lending Practices in (HELP) Rural Communities Act would create a process to allow areas to petition the CFPB with important local information for reconsideration of their rural status. This would give rural counties across the country a voice when the CFPB has incorrectly deemed them “non-rural.” The bill also takes important steps to address the challenges rural communities face by eliminating arbitrary mortgage origination requirements that will help ensure that rural communities bordering urban areas are still able to access credit services that are essential to rural small businesses and farmers.

“Washington’s bureaucrats at the CFPB have continually struggled to understand rural America, labeling counties in Kentucky, such as Bath County, as ‘non-rural’ and limiting rural lending practices that are helpful to farmers and small businesses,” Senator McConnell said. “While I welcome the CFPB’s recent efforts to improve the rural definition, I remain concerned that rural communities – particularly those in Kentucky – have been left without a voice.  Our legislation seeks to correct this by putting into statute a process that allows areas that have been improperly designated as ‘non-rural’ to petition the CFPB with additional local information to reconsider their status and to ensure no rural community is ever improperly designated.  It will also help ensure that rural communities have the access to lending opportunities they need to grow their economy.  I want to thank Senators Heller, Capito, Rounds and Fischer, as well as Representative Andy Barr, for their support of this important legislation.”

Ballard Cassady, President and CEO of the Kentucky Bankers Association, praised Senator McConnell’s efforts on behalf of Kentucky’s rural community banks: “This legislation will give rural communities a voice in the federal, top-down regulations coming out of the CFPB that they often don’t have a say in.  It will provide Kentucky communities with the opportunity to weigh in on the determination of whether an area qualifies as rural or not, and it expands community bank lending opportunities in rural areas.  This legislation is crucial in helping rural communities access the credit they need to survive, and we commend Senator McConnell for standing tall for rural Kentuckians by representing their needs in Washington,” Cassady said.

Thomas Richards, Assistant Vice President of the Owingsville Banking Company in Bath County, explained how this bill will specifically help Kentucky rural communities: “The HELP Rural Communities Act addresses a problem that arose from the CFPB’s errant classifications, which originally excluded Bath County from its definition of rural.  This bill ensures that no Kentucky rural community will again be misclassified and helps ensure Kentucky’s rural communities will have access to the lending opportunities they need.  As a community banker, I truly appreciate Senator McConnell’s efforts to stand up for communities like Bath County in Washington,” Richards said.

Wendell Lyons, President and CEO of the Kentucky Credit Union League, thanked Senator McConnell for his leadership on this issue: “The HELP Rural Communities Act will go a long way to ensure that Kentucky’s credit unions are afforded the regulatory relief needed to serve its rural constituents.  It provides a valuable opportunity for rural communities to ensure they are identified as such and are able to access the credit services they need.  The Kentucky Credit Union League thanks Senator McConnell for his work to stand up for Kentucky rural communities and the community financial institutions that serve them,” Lyons said.

Charles A. Vice, Commissioner for the Kentucky Department of Financial Institutions, stated, “I am pleased that the HELP Rural Communities Act was passed as part of the FAST Act.  The HELP Rural Communities Act creates a petition process for rural areas that have not been designated as rural by the CFPB.  It creates a method for community banks and other stakeholders to seek ‘rural’ designation for a specific geographic area under the CFPB’s mortgage rules, and provides the needed flexibility for community banks to provide appropriate loan products to individuals living in rural areas.  Community banks are vital to Kentucky’s economy expansion and growth.”

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