Aaron Stetter: 2020 advocacy in review

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This year, community banks came out in full force to advance pro-community bank reforms.

By Aaron Stetter, ICBA

No matter how you measure community bank grassroots advocacy throughout the year—emails, phone calls, letters or other outreach—it’s clear community bankers came out in full force in 2020.

More than 9,000 community bankers sent nearly 60,000 emails to Congress between March and October. They called for COVID-19 relief, commented on the Paycheck Protection Program (PPP), asked lawmakers to resist the efforts of tax-exempt credit unions to buy banks, and pushed back against a mortgage fee implemented too quickly. In many cases, proactive community bankers responded to ICBA’s alerts with lightning speed—at times sending thousands of letters in just 24 hours.

These emails have reached 480 congressional offices, including 98% of Senate offices and more than 88% of House offices. Community bankers and their small business customers made 1,300 phone calls urging Congress to streamline the PPP loan forgiveness process. This was in addition to the more than 500 comment letters community bankers sent to regulators looking for comment on various rules.

And those are just the actions initiated through ICBA’s Grassroots Advocacy Center. This online resource (icba.org/advocacy) makes it easy for community bankers to send emails or call their members of Congress to advocate for pressing issues important to the industry and the communities they serve.

Let’s review what community banks did this year on the advocacy front.

COVID-19 relief and PPP reform

Community bankers made roughly 2.8 million PPP loans that saved an estimated 33.7 million jobs, but they didn’t just lead the way in PPP lending. They also advocated for improvements in the program. They were strong advocates for PPP improvements to benefit small business customers across the country.

Between March and October, community bankers sent more than 35,000 emails to lawmakers on Capitol Hill to advocate for pro-community bank and pro-Main Street COVID-19 relief provisions and PPP reforms. They were heard loud and clear. At least $60 billion of PPP funds in the second round of funding were dedicated to loans from community financial institutions that serve their local small businesses. And at least $30 billion in funding was allocated for institutions with less than $10 billion in assets, and another $30 billion for those with between $10 billion and $50 billion in assets.

Community banks have been proactive in reaching out to the small business customers they’ve aided to help tell their stories and push for streamlined PPP forgiveness for loans of $150,000 or more. In just two weeks, small business community bank customers made more than 500 phone calls and sent 400-plus letters using ICBA advocacy resources. That’s on top of the several hundred calls and more than 10,000 emails and letters sent by community banks. These efforts contributed to the Small Business Administration’s decision to grant relief for loans of less than $50,000.

Pushing back against the adverse market fee

When the Federal Housing Finance Agency (FHFA) sprung an adverse market fee of 50 basis points on refinance loans delivered to the government-sponsored enterprises (GSEs) beginning Sept. 1, community bankers responded en masse. In just a week, 1,200 community bankers sent 3,700 messages to Capitol Hill arguing the adverse market fee would have a negative economic impact on community bank mortgage lenders and consumers.

Community bank advocates reached 60% of congressional offices with their time-sensitive emails, and those messages were heard. Within days, the FHFA shifted course, delaying the fee until Dec. 1. That gave community bank mortgage lenders enough time to process and close loans locked in before the fee was announced and exempted loan amounts of less than $125,000, helping keep loans affordable for low-income borrowers.

Combating credit unions

Community bankers sent more than 15,000 messages to Capitol Hill as part of ICBA’s “Wake Up” campaign, which urges policymakers and the public to wake up to the risky practices, costly tax subsidies and irresponsibly lax oversight of the nation’s credit unions. The letters asked members of Congress to hold hearings on unfair credit union competition and to examine the troubling trend of credit unions misusing their tax exemption to buy taxpaying community banks.

While there was no hearing this year, community bankers will continue to sound the alarm and push for hearings in 2021. ICBA members also sent more than 500 letters to regulators, including the National Credit Union Administration, FDIC and Office of the Comptroller of the Currency (OCC), on topics ranging from subordinated debt and credit union acquisitions to brokered deposit restrictions and the Community Reinvestment Act (CRA).

Making ICBPAC contributions

ICBPAC was also extremely active throughout the year. More than 2,500 leadership bankers and bank employees have contributed $720,000 year-to-date and $1.7 million throughout the 2019–2020 election cycle. ICBPAC has dispersed nearly $1.5 million to support more than 300 candidates and committees during this election cycle—including more than $740,000 in 2020.

Despite the challenges of COVID-19, in coordination with our affiliated state community bank association partners and ICBA leadership bankers, ICBPAC has been able to facilitate 53 check presentations totaling $82,000 in 2020.

Looking ahead to 2021, ICBA will continue to direct meaningful and effective grassroots advocacy efforts through the Be Heard Grassroots Action Center so that community bankers know how to best make their voices heard. Nothing is more effective in terms of industry advocacy than a community banker’s relationship with a legislator.

Be an advocate in 2021

Find everything you need to be an advocate for community banks at icba.org/advocacy

Aaron Stetter (aaron.stetter@icba.org) is ICBA executive vice president of policy and political operations