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| ## Comptroller of the Currency                                        |
|                                                                       |
| > Administrator of National Banks                                     |
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Washington, DC 20219

**Community Development Investment Letter #1999-1**

#### September 2004

Number range CHAPTERFebruary 25, 1999 **12 CFR 24**

Michael E. Bleier

General Counsel

Mellon Bank, N.A.

One Mellon Bank Center

Pittsburgh, PA 15258-0001

Dear Mr. Bleier:

This letter is in response to your request for approval from the Office
of the Comptroller of the Currency (\"the OCC\") for an investment by
Mellon Bank, N.A. (\"the Bank\") in the Community Development Trust,
Inc. ("CDT"), pursuant to 12 U.S.C. § 24(Eleventh) ("Statute") and 12
C.F.R. Part 24 ("Regulation"). CDT is a Maryland corporation that
operates as a self-managed real estate company that is electing to be
taxed as a real estate investment trust for U.S. Federal income tax
purposes and will operate as a community development real estate
investment trust ("REIT").

CDT's mission, as described in its Articles of Incorporation and its
Bylaws, is to provide capital investments to projects that are designed
to support community development including affordable housing for low-
or moderate-income individuals; community services targeted to low- or
moderate-income individuals; activities that promote economic
development by financing small businesses; or activities that revitalize
or stabilize low- or moderate-income geographies. The vast majority of
its investments (both debt and equity) will be in the area of affordable
housing, primarily benefiting low- and moderate-income people. It may
also invest in housing which revitalize or stabilize low-or
moderate-income areas, while primarily benefiting low- and
moderate-income people.

As a REIT, CDT will have the opportunity to play a significant role in
the federal government's mark-to-market program designed to preserve the
existing stock of Section 8 affordable housing properties while reducing
Federal subsidy costs by allowing current owners of Section 8 projects
to transfer their projects to CDT in a nontaxable exchange. CDT will be
the first REIT in the country to offer this exchange opportunity as a
means of getting affordable housing properties transferred from parties
that are no longer interested in holding these assets into the portfolio
of a community development mission driven REIT. CDT as a national REIT,
will be able to bring the benefits of geographic diversity and size to
the pools it assembles, enabling the benefits of securitization to
accrue to multifamily, affordable housing the way that it has for single
family homes. The private market has, to date, not served this
investment class.

Based on the Bank\'s community development investment proposal
("Proposal") and other supporting materials summarized below, we have
concluded that the Bank's proposed equity investment in CDT, is
consistent with the Statute and the Regulation and the investment is
approved. Information about the Bank's proposed investment is summarized
below.

CDT was recently formed in conjunction with a major initiative by Local
Initiative Support Corporation ("LISC"), a national nonprofit, community
development intermediary with 20 years of experience in community
development. LISC will be responsible for managing and maintaining the
properties of the CDT portfolio. LISC will conduct on-site inspections,
monitor compliance with financial covenants, assess regulatory changes
and compliance issues, and maintain appropriate capital levels and
allowances for credit losses.

The Bank's equity investment in CDT and the aggregate of its investments
in all such community development projects will not exceed 5 percent of
its unimpaired capital and surplus. In the future, the Bank's aggregate
investment in all such projects under the Regulation may not exceed 5
percent of its unimpaired capital and surplus, without obtaining prior
written approval from the OCC. In no case shall the Bank's aggregate
investments exceed 10 percent of its unimpaired capital and surplus.

The Bank will provide a final, executed copy of the CDT Private
Placement Memorandum to the Community Development Division (\"Office\")
of the OCC. We understand that the Bank\'s investment in the CDT will be
made upon the approval of this Proposal by the OCC. If the Bank has not
made its investment in the CDT by February 29, 2000, approval for the
Bank\'s investment will lapse and may only be extended, based on your
written request, prior to that date.

If requested by the Office, the Bank shall provide reports concerning
its investment in CDT and CDT's financial status, activities and
accomplishments. Copies of all reports submitted to the Office shall
also be provided to the OCC Deputy Comptroller for Large Banks.

If you have any questions regarding this opinion letter, please contact
me, Letty Ann Shapiro, Community Development Specialist or David R.
Lewis, Community Development Investments Manager, at (202) 874-4930.

Sincerely,

**signed**

Janice A. Booker

Director

Community Development Division

cc: Martin McGuinn, President, Mellon Bank, N.A