Owners & management · Deals & development · 10/19/2026
Proposed CRA Rule Could Cut Bank Investment in NY Affordable Housing
The OCC and FDIC propose Community Reinvestment Act changes that would drop an incentive for banks with about $1.65 billion to $10 billion in assets to invest in Low-Income Housing Tax Credit projects. In an op-ed, Carlina Rivera of the New York State Association for Affordable Housing warns this could delay construction and preservation. She urges regulators to revise the proposal.
Reported by Commercial ObserverRead the original ↗
What happened
Commercial Observer published an opinion piece on October 19, 2026, by Carlina Rivera, president and CEO of the New York State Association for Affordable Housing and a former New York City Council member from Manhattan. She warns that a proposed federal banking rule could reduce private money for affordable housing in New York.
The Office of the Comptroller of the Currency (OCC) and the Federal Deposit Insurance Corporation (FDIC) have proposed changes to the Community Reinvestment Act (CRA). That law encourages banks to meet the credit needs of the communities they serve, including low- and moderate-income neighborhoods. According to the piece, the proposal would remove an incentive for banks with about $1.65 billion to $10 billion in assets to invest in the federal Low-Income Housing Tax Credit, also called the Housing Credit.
Rivera says banks supply an estimated 75 to 80 percent of Housing Credit equity nationwide, and at least 71 percent of that investment is motivated in part by the CRA. She cites an October 2026 Affordable Housing Tax Credit Coalition survey that found at least 108 banks under $10 billion in assets invested about $1.6 billion in Housing Credit equity over five years. About one-third of that supported rural markets. In New York, she says, the credit supported about 1,504 projects and nearly 160,000 units from 2010 to 2020.
She asks the OCC and FDIC to revise the proposal to keep a meaningful investment test for banks of all sizes, or to adopt an equally effective alternative. The rule is a proposal and has not been adopted.
Key facts
- Agencies
- Office of the Comptroller of the Currency (OCC) and Federal Deposit Insurance Corporation (FDIC)
- Law affected
- Community Reinvestment Act (CRA)
- Banks affected
- Banks with about $1.65 billion to $10 billion in assets
- Program at risk
- Low-Income Housing Tax Credit (Housing Credit)
- NY Housing Credit record
- About 1,504 projects and nearly 160,000 units statewide, 2010 to 2020, about 80 percent affordable to low-income households
- Bank share of equity
- Banks supply an estimated 75 to 80 percent of Housing Credit equity nationwide
- Smaller bank investment
- At least 108 banks under $10 billion invested about $1.6 billion over five years (October 2026 survey)
- Rent burden in NY
- About 2.9 million households spend at least 30 percent of income on housing; roughly one in five spends more than half (state comptroller, February 2024)
What it means
Tenants and voucher holders
Nothing changes today for current tenants or voucher holders. If the rule is adopted as written, the author warns that fewer tax credit projects could close financing, which could mean fewer new or preserved affordable units over time.
Landlords
Owners and developers who rely on Housing Credit equity to build or preserve buildings could find fewer bank investors, especially smaller regional banks. That could delay projects or make financing harder to close.
Caseworkers
There is no immediate change to placements. Over time, a slower pipeline of tax credit units could mean fewer affordable vacancies for clients.
The highlights
- Change targets banks with about $1.65 billion to $10 billion in assets.
- Banks supply an estimated 75 to 80 percent of Housing Credit equity nationwide.
- The Housing Credit backed nearly 160,000 New York units from 2010 to 2020.
Why it matters
Less bank equity for tax-credit projects could slow new affordable units and preservation deals across New York.
What to do: Watch for the final OCC and FDIC rule.
Not known yet
- When the OCC and FDIC plan to make a final decision
- Whether there is a public comment period or deadline
- How many New York City projects depend on investment from banks in the affected size range
- Whether the agencies have responded to these concerns
Background
The Low-Income Housing Tax Credit is a federal program. Agencies allocate credits to developers, who sell them to investors, often banks, to raise equity for construction or preservation. In New York City, credits are generally allocated through state and city housing agencies such as HCR, HPD and HDC. Units in tax credit buildings carry income limits and rent restrictions for many years. New units in the city are commonly filled through the NYC Housing Connect lottery.
Summary written by Bulwark from Commercial Observer’s reporting. The original story is at commercialobserver.com. This is general information, not legal advice.
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Photo: Andre Carrotflower, CC BY-SA 4.0