The following message appears on the FFIEC download of CRAW and HMDA data collection software download page.

"The Census income data classifications are not yet available for 2004. As a result, the income classification of each tract (i.e., low, moderate, middle, and upper) will not be available for the 2004 activity year until early third quarter 2004. Please visit our web site (www.ffiec.gov/hmda) in 2004 for updated information."

It is also doubtful the geocoding systems will begin to code the new 5 digit MA numbers on 1/1/04

Changing data in the middle of year makes no sense, and IMO the new MA code numbers and tract data should not become effective until 1/1/2005. That way we would at least have 2003 and 2004 data that could be compared.

Those who typically geocode as they go, will have to gear up for a batch mode. This wasn't totally unexpected by many of us, especially you, Don. You have been warning of this possibility.

The hard part may be those special targeted areas that have been internally designated. Now they're moving targets.

Everything else will stay the same, correct? Just the MA code will be different.
As an example we geocode one by one using FFIEC. So the people input the current info. In the third quarter of 2004 all I have to do is do a search find command to replace the old MSA number with the new MA number.

Jennifer,
What are you are using in order to do a search and replace?

No, thats not the only change In many areas the change in MA's is more than just a code number. Many MA's have added or deleted whole counties. This changes the demographics of the MA.

The biggie is that the MA Median Family income will change due to the addition or deletion of counties to the new MA. This change can have an effect on census tract income classifications as the formula to calculate tract income class is the Tract Median Family income divided by the MA median family income. A very strong possibility exists that this will changes the Low Mod Middle and Upper Income classifications.

More rural counties the are not now in an MA, and use the State median family income, instead of an MSA med family income, to calculate tract income classification, will now be in an MA, and use a different median family income than now used, which will surely have an effect on tract classifications.

How dramatic the change will be is entirely dependent on the change in the boundary of the new MA,s' A few are lucky and no changes to the MA have occurred, but there are many changes that will effect most of you.

I am sorry that I wasn't clear Don. I thought that Andy was talking about Batch Geocoding. I understand that it will affect income classifications and such, but as far as Geocoding goes, all the tract bounderies did not change, Correct? The 4 digit MSA codes were just done away with a new MA codes were designed which may put new counties as MA which were previously not MSA etc.

So by looking at your chart I can see that old MSA 1234 (this is just an example I don't have your chart handy )
is now MA 54321. So if I do my geocoding on a loan by loan basis all I have to do is do a search for MSA 1234 and replce it with the new 54321. This will take some careful analysis but should fix the geocoding issue if I am not mistaken.

Please help me I want to be sure that I am understanding this.

Thats true, You will need to replace the 4 digit MSAnumber with a 5 digit MA number. Tract numbers, state and county FIPS will remain the same

Also remember that the new "Division" numbers replace the old PMSA numbers. So if you are in a large MA that has "Divisions" use the 5 digit Division number

Thanks Don. This is Jennifer...I am checking BOL from home so I am not logged in.

The designation of the 2004 MSA/MD boundaries will require the definition of revised MSA/MD median family income values for both new and revised geographies. The FFIEC has not yet provided revised MSA median family income values for the 2004 MSA/MD boundaries. As the Census tract income level is defined as the Census tract median family income as a percentage of the MSA/MD/non-metro area median family income, the potential for change in designation in 2004 is significant.

However, for CRA Wiz clients, PCi has used US Census methodologies to calculate a preliminary MSA/MD median family income figure. Using this value, it is possible to see the significant shifts in the tract income figures. If Don, or anyone else, would like to see a more detailed analysis of the tract changes, or receive the actual MSA/MD and non-metro area median family income figures, please contact PCi at 800.261.3111. For those who are interested, we also have approximated 2004 HUD Median values for the new MSA/MD geographies.

As a brief summary of the tract income category shifts, in initial assessments, over 3,500 Census tracts will have revised tract income levels when the revised MSA/MD boundaries become effective.

Suggested Actions to Manage the 2004 MSA/MD Definitions:
-- LMI penetration goal setting for 2004 should be revisited in light of the MSA/MD definitions and revised median family income values.

--Review Service Test performance for branch placement within new MSA/MD boundaries

--Any institutions with assessment areas in any of the new or modified geographies will need to revisit their assessment area definitions for 2004.

--Some institutions that have been lending exclusively in non-metropolitan areas will find that they now have additional obligations under HMDA and/or CRA.

--Review redlining analysis conducted, especially for non-metropolitan areas.

--Update public file information.

A few 2004 MSA/MD Facts and Figures
--The previous standard of 4-digit numbers to describe MSAs has been expanded to 5 digits. For example, the Akron, OH MSA “0080” is now MSA “10420”. The new designation for Metropolitan Divisions or MDs, which are sub-sets of MSAs, are also identified by 5 digits. Identifying code numbers are assigned alphabetically in accordance with the geography area title.

--All MSAs and MDs are comprised of whole counties. As of 2004, no counties will split into multiple metropolitan geographies.

--Non-MSA areas continue to exist in many states, but will consist of much smaller areas, and several states no longer contain non-MSA areas: District of Columbia, New Jersey, and Rhode Island are fully comprised of defined MSA/MD geographies.

--Of the 370 MSAs in the United States and Puerto Rico, 49 are new additions designated by the OMB for 2004.

--Eleven MSAs - those that contain a single core with a population of 2.5 million or more - are divided into subset areas identified as Metropolitan Divisions or MDs.

--These eleven MSAs represent 29 MDs

--In summary, there are a total of 359 MSAs and 29 MDs for 2004 HMDA/CRA reporting. The 29 MDs cover the area for the 11 MSAs removed from the geography listing.

Todd Cooper
EVP CRA & HMDA Products
PCi Corporation
Todd_cooper@pciwiz.com