I
106TH CONGRESS
2D SESSION
H. R. 4490
To establish a program to promote access to financial services, in particular
for low- and moderate-income persons who lack access to such services,
and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
MAY 18, 2000
Mr. LAFALCE (for himself, Mr. LEACH, Ms. WATERS, Mr. FRANK of Massa-
chusetts, Mr. VENTO, Mr. KANJORSKI, Mrs. MALONEY of New York, Mr.
SANDERS, Mr. GUTIERREZ, Mr. BENTSEN, Ms. HOOLEY of Oregon, Ms.
CARSON, Ms. LEE, Mr. MASCARA, Mr. INSLEE, Mrs. JONES of Ohio, Mr.
GONZALEZ, Mr. CAPUANO, Mr. FROST, Ms. ROYBAL-ALLARD, Ms. RIV-
ERS, Mr. JEFFERSON, Ms. MILLENDER-MCDONALD, Mr. HINCHEY, and
Mr. WEYGAND) introduced the following bill; which was referred to the
Committee on Banking and Financial Services
A BILL
To establish a program to promote access to financial serv-
ices, in particular for low- and moderate-income persons
who lack access to such services, and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘First Accounts Act
of 2000’’.
•H 4490 IH
SEC. 2. FINDINGS AND PURPOSE.
(a) FINDINGS.—The Congress finds as follows:
(1) Many low- and moderate-income persons
lack adequate access to basic financial services, such
as a low-cost transaction or savings account at a
federally insured depository institution.
(2) The lack of such basic financial services in-
creases costs for such persons, reduces their ability
to manage their finances and to save and plan for
the future, and limits their access to other financial
products, such as credit cards, home mortgages, or
automobile loans.
(3) Existing products and services may not be
adequate to meet the needs of low- and moderate-in-
come persons for financial services, such persons
may be inadequately informed about financial issues,
and depository institutions may have insufficient in-
formation about such persons to develop suitable
products for them.
(4) Increasing access to basic financial services
will require research and development, incentives to
provide basic accounts and increase access to finan-
cial services, and consumer and depository institu-
tion education.
(b) PURPOSE.—The primary purpose of this Act is
to create a program to promote access to financial serv-
•H 4490 IH
ices, in particular for low- and moderate-income persons
who lack access to such services, including low- and mod-
erate-income persons who do not receive Federal benefits.
SEC. 3. DEFINITIONS.
For purposes of this Act, the following definitions
shall apply:
(1) COMMUNITY
PARTNER.—The term ‘‘com-
munity partner’’ means a nonprofit organization,
State or local government agency, quasi-govern-
mental entity, or community development financial
institution (as defined in section 103(5) of the Com-
munity Development and Financial Institutions Act
of 1994) that provides education to low- and mod-
erate-income persons regarding financial services, or
develops or provides financial services for low- and
moderate-income persons or otherwise facilitates the
provision of financial services to such persons.
(2) DEPOSITORY INSTITUTION.—The term ‘‘de-
pository institution’’ means—
(A) any insured depository institution (as
defined in section 3(c) of the Federal Deposit
Insurance Act); and
(B) any insured credit union (as defined in
section 101(7) of the Federal Credit Union
Act).
•H 4490 IH
(3) FINANCIAL
SERVICES
ELECTRONIC
NET-
WORK.—The term ‘‘financial services electronic net-
work’’ means an organization or entity that provides
electronic access to an individual’s account at a de-
pository institution, including an automated teller
machine network, point-of-sale network, and a pro-
vider of such services through the Internet.
(4) INDIAN RESERVATION.—The term ‘‘Indian
reservation’’ has the same meaning as in section
4(10) of the Indian Child Welfare Act of 1978 and,
to the extent not already included, shall include
lands held by incorporated Native groups, regional
corporations, and village corporations, as defined in
or established pursuant to the Alaska Native Claims
Settlement Act; public domain Indian allotments;
and former Indian reservations in the State of Okla-
homa.
(5) LOW- AND MODERATE-INCOME.—The term
‘‘low- and moderate-income’’ means a family income
that does not exceed—
(A) for nonmetropolitan areas, 80 percent
of the statewide median family income; or
(B) for metropolitan areas, 80 percent of
the greater of statewide median family income
or metropolitan area median family income.
•H 4490 IH
(6) SECRETARY.—The term ‘‘Secretary’’ means
the Secretary of the Treasury.
(7) SERVICE AREA.—
(A) IN
GENERAL.—The term ‘‘service
area’’ means—
(i) any population census tract for
which the poverty rate is 20 percent or
greater, based on the most recent census
data;
(ii) any population census tract—
(I) which is not located within a
metropolitan area; and
(II) for which the median family
income does not exceed 80 percent of
statewide median family income;
(iii) any population census tract—
(I) which is located within a met-
ropolitan area; and
(II) for which the median family
income does not exceed 80 percent of
the greater of statewide median family
income or the metropolitan area me-
dian family income;
(iv) an Indian reservation; and
•H 4490 IH
(v) any other area that has significant
unmet needs for financial services, as may
be determined by the Secretary.
(B) APPLICATION IN ABSENCE OF POPU-
LATION CENSUS TRACTS.—In the case of an
area that is not tracted for population census
tracts, the equivalent county divisions (as de-
fined by the Bureau of the Census for purposes
of defining poverty areas) shall be used in lieu
of population census tract for purposes of
clauses (i), (ii), and (iii) of subparagraph (A)
and in determining poverty rates and median
family income for purposes of such clauses.
(8) SERVICE POPULATION.—The term ‘‘service
population’’ means individuals, or a group of individ-
uals, who are low- or moderate-income, or who oth-
erwise lack adequate access to financial services, as
may be determined by the Secretary.
SEC. 4. ESTABLISHMENT OF A PROGRAM FOR EXPANSION
OF FINANCIAL SERVICES TO THE UNDER-
SERVED.
The Secretary of the Treasury shall establish a pro-
gram to support and promote—
(1) the expansion of access to financial services,
in particular for low- and moderate-income persons
•H 4490 IH
who lack access to such services, and for other pur-
poses;
(2) the development of new financial products
and services that are adequate to meet the needs of
low- and moderate-income persons for financial serv-
ices;
(3) the education for both low- and moderate-
income persons and depository institutions con-
cerning the availability and use of financial services
for and by such persons; and
(4) such other activities and projects the Sec-
retary may determine are consistent with the pur-
poses of this Act.
SEC. 5. POWERS AND AUTHORITIES OF THE SECRETARY.
(a) IN GENERAL.—In carrying out the program es-
tablished pursuant to section 4, the Secretary may make
or enter into grants, cooperative agreements, and con-
tracts, and designate depository institutions as financial
agents of the Treasury, to provide for technical assistance,
education, training, or financial services, to further the
purposes of this Act.
(b) SPECIFIC POWERS.—The powers of the Secretary
under this Act shall include the following:
(1) FINANCIAL SERVICES.—The Secretary may
promote access to financial services by providing fi-
•H 4490 IH
nancial and technical assistance to depository insti-
tutions for providing low-cost financial services,
including—
(A) electronic transaction accounts;
(B) savings accounts; and
(C) other financial services deemed appro-
priate by the Secretary to meet the needs of
service areas or service populations.
(2) DISTRIBUTION.—The Secretary may pro-
mote access to financial services by providing finan-
cial and technical assistance to depository institu-
tions, financial services electronic networks, or com-
munity partners for expanding the distribution of fi-
nancial services to service areas or service popu-
lations, including through financial services elec-
tronic networks.
(3) EDUCATION.—The Secretary may promote
access to financial services by—
(A) providing financial education to service
areas or service populations;
(B) providing technical assistance or train-
ing to or by depository institutions or commu-
nity partners; and
•H 4490 IH
(C) otherwise promoting financial services
to or by service areas, service populations, de-
pository institutions, or community partners.
(4) RESEARCH AND DEVELOPMENT.—The Sec-
retary may conduct or support such research and de-
velopment as the Secretary considers appropriate in
order to further the purposes of this Act, including
the collection of information about access to finan-
cial services.
(c) SELECTION CRITERIA.—
(1) IN GENERAL.—In selecting any depository
institution, community partner, or financial services
electronic network as a recipient of a grant or other
financial assistance under this Act, the Secretary
shall consider the following criteria:
(A) The likelihood of success of the deposi-
tory institution, community partner, or finan-
cial services electronic network in achieving the
purpose of the grant or assistance and carrying
out the purposes of this Act.
(B) The experience of the depository insti-
tution, community partner, or financial services
electronic network in undertaking activities
similar to the activities to be funded or sup-
•H 4490 IH
ported by the proceeds of the grant or other fi-
nancial assistance.
(C) Such other factors, including manage-
ment, and performance criteria, as the Sec-
retary may determine to be appropriate.
(2) PUBLICATION OF CRITERIA.—The Secretary
shall publish the selection criteria established pursu-
ant to paragraph (1) in the Federal Register.
(d) TERMS AND CONDITIONS.—
(1) IN GENERAL.—Before providing any assist-
ance under this Act, the Secretary and each entity
to be assisted shall enter into an agreement that re-
quires such entity to comply with performance goals
and abide by other terms and conditions as deter-
mined by the Secretary.
(2) REMEDIAL TERMS AND CONDITIONS.—The
agreement shall provide that, in the event of fraud,
mismanagement, or noncompliance with the terms of
the agreement, the Secretary shall have discretion
to—
(A) require changes to the performance
goals;
(B) terminate the agreement or reduce as-
sistance under the agreement;
(C) require repayment of assistance;
•H 4490 IH
(D) bar an entity from reapplying under
the program; or
(E) take such other action as the Secretary
deems appropriate.
(e) FINALITY OF DECISIONS.—Any determination,
including the selection of recipients of grants and other
financial assistance, under this Act shall be made in the
sole discretion of the Secretary and shall be final.
(f) REGULATIONS.—The Secretary may prescribe
such regulations and procedures as the Secretary deter-
mines to be appropriate to carry out the program and the
purposes of this Act.
SEC. 6. REPORTS.
The Secretary shall submit a report to the Congress
by the end of the 2-year period beginning on the date of
the enactment of this Act, and annually thereafter,
containing—
(1) a detailed description of the operation of the
program established under section 4;
(2) the findings and conclusions of the Sec-
retary on the extent to which the program is meet-
ing the purposes of this Act and the goals of the
Secretary in establishing the program; and
•H 4490 IH
(3) such recommendations for legislative or ad-
ministrative action as the Secretary may consider to
be appropriate.
SEC. 7. AUTHORIZATION OF APPROPRIATIONS.
(a) IN GENERAL.—To carry out this Act, there are
authorized to be appropriated to the Secretary, to remain
available until expended—
(1) $30,000,000 in fiscal year 2001; and
(2) such sums as may be necessary to carry out
this Act in each of fiscal years 2002 through 2005.
(b) ADMINISTRATIVE EXPENSES.—Of amounts ap-
propriated to the Secretary, not more than $3,000,000
may be used in any fiscal year to pay the administrative
costs and expenses of the program. Costs associated with
research and development, training, technical assistance,
and education shall not be considered to be administrative
expenses for purposes of this subsection.
Æ