supporting economic development. it was created specifically to foster the establishment and growth of minority businesses by providing funding for a network of business development and resource centers throughout the country that provide minority entrepreneurs with one - on - one assistance. mbda recognizes that the minority - owned business sector presents a huge growth opportunity, as the minority population is expected to grow from 30 percent of the current population to more than 50 percent by the year 2050. nonetheless, mbda recognizes that while minorities account for 30 percent of the population, minority firms constitute only 15 percent of all businesses and employ only 4 percent of the nation ’ s employees, generating 3 percent of u. s. business revenues. these numbers reflect the fact that minority - owned businesses tend to be in non - asset - based industries, such as service, construction, finance, real estate, and insurance. mbda believes that minorities continue to face systemic barriers to accessing the capital markets, and the agency is dedicated to removing these impediments. the federal reserve also recognizes the importance of information sharing and creating infrastructures that support information flow. consistent with its mission of promoting economic growth, the federal reserve promotes small - business development, particularly in underserved markets, through its community affairs offices. these offices, located in federal reserve districts around the country, provide technical assistance, host workshops and conferences, publish newsletters and reports, and sponsor research to help educate market participants. for example, last fall the community affairs office here at the federal reserve bank of cleveland partnered with the federal reserve bank of new york, state and local government, and financial institutions to convene a conference titled “ big ideas for small businesses. ” conferences in ohio and pennsylvania provided important information on establishing and developing businesses as well as demystifying the lending experience for entrepreneurs. all of these efforts on the part of government agencies - whether federal, state, or local - have the goal of stimulating a self - sustaining process of economic development that will create good jobs and lead to upward mobility. most successful entrepreneurs see opportunity in the context of their own skills and a particular need in their community or market with which they identify. the exact recipe for success in any one place will not be determined by a government agency, but by the community itself, with the government acting as a supportive partner. conclusion in closing, i believe the progress that has been made by policymakers in the field of community development over the last thirty years has been remarkable. community development practitioners have always understood the value

requires federal regulators to evaluate how depository institutions help meet the credit needs of their communities. the statute was amended in 1989 to require that those evaluations be made public. the public evaluations of cra performance, together with the fact that the performance evaluations are considered by regulators in connection with a bank or thrift ’ s application to merge or acquire another institution, have provided incentives for depository institutions to lend in all parts of the neighborhoods they serve, including lowand moderate - income areas. the cra regulations were amended in 1995 to make the evaluation standards more performanceoriented while still taking into account the diversity of business strategies among depository institutions and the variety of economic and demographic characteristics of neighborhoods. as a result, four different evaluation methods were established, and each method considers the context in which the institution operates. in other words, no matter what type of evaluation an institution receives - a streamlined examination for small institutions ; a lending, investment, and service test for large institutions ; a community development test for wholesale or limited - purpose institutions ; or a strategic see william m. rohe, shannon van zandt, and george mccarthy ( 2001 ), the social benefits and costs of homeownership : a critical assessment of the research, ( 170 kb pdf ) ( cambridge : joint center for housing studies of harvard university ). plan - the characteristics of the institution and the neighborhoods it serves are considered in assigning a performance rating. when cra rules were revised in 1995, the agencies committed to reviewing them again in 2002 to ensure their continued effectiveness. the review process has taken much longer than anticipated, but some progress has been made. the federal reserve, together with the office of the comptroller of the currency and the federal deposit insurance corporation, is currently reviewing comments on our joint proposal to amend the cra regulations. these amendments would eliminate data - reporting burdens for institutions under $ 1 billion in assets, provide for a new evaluation method for institutions between $ 250 million and $ 1 billion in assets, and more effectively define community development in rural areas. in proposing these changes to the cra, the agencies were attempting to balance the compliance burdens being placed on small community banks against community development needs in the geographic areas they serve. the proposal was designed to relieve data - collection burdens on the smaller, large banks while retaining incentives for these institutions to participate in community development activities. the proposed community development test was intended to promote substance over form and give smaller institutions recognition for activities