I just wanted to clarify which would qualify and which would not.
School is majority free/reduced lunches.
1) Donation to purchase PE equipment.
2) Donation to after school literacy program.
3) Donation to school lunches (funds in case students can't pay for lunch)
4) Donation to music class for equipment.
5) Donation to art class for equipment.

Also, where can I find information to support the answers?
I believe that only 2 and 3 would qualify based on targeting specifically low/moderate income people but wanted to double check.

Personally, I think they should all count as CD Donations under the community services section because they are all supporting education that targets LMI individuals. I say they are all targeted to LMI because the school is majority free/reduced lunch so the majority of the benefit will be to LMI individuals in theory.

The Q&As provide non-specific support but examiners should be accepting of the support you have regarding the free/reduced lunch information. At least in my area that is how it has been viewed.

You indicated the school has more than 50% of its students on the FRL program, so you have already found a way to verify that a majority of clients are LMI.

A donation for any services to this school targets a majority LMI. You do not have to take the additional step of verifying that your donation is set aside for only those receiving free or reduced lunches.

I disagree 2) targets only those that qualify for the FRL program. Any student could attend the literacy program, couldn't they?

Thank you both very much! Makes sense that any donation to a majority LMI should qualify. I think that sometimes I overthink.

Thanks again.

Ok new question, I have a lender that is going to volunteer with a 501c organization. It's a sports program for kids but not school related.
The lender mentioned that there is a membership fee but those unable to pay would be sponsored.

Is there anyway I could argue this to qualify?

Those types of programs can be tough to demonstrate CD credit. Can you show how many of the children in the program are LMI? That is where you run into the difficulty when it is a broad based program, let alone running up against examiners who don't want to count such programs at all.

Thank you for the response. I was assuming this as well but just wanted to make sure the 501c didn't make a difference but I realize the point is LMI.

Thanks again!

If it involves exercise and fun --- fogett about it!

Yep - CRA is the enemy of fun. No, seriously.

However, IF the non-profit provides services to predominately LMI children, or IF your officer is devoting his attention to a portion of the program dedicated to LMI childen, and IF his banking expertise is utilized - i.e. he helps with fundraising, is on the board of directors, or maybe he has found a way to introduce financial literacy education as part of the sports program - then you have a shot.

The most difficult part is to get the documentation from the non-profit that supports they are providing services to children from LMI households.

If the non profit doesn't have documentation, you might be able to use the local school districts assisted lunch program data. Presuming they can tell you what school their kids come from. In most of my small towns, there's only one, but in a few of our bigger "cities" we have multiple and it is all but impossible to prove that way.

I don't try to count the athletic donations. We just consider them community relations and move on. It's just a battle that I choose not to fight. If you do, you should check the free/reduced lunch for schools in the area to attempt to qualify the athletes are LMI.

This is kind of a piggyback question...

We have a school who sends qualified students (good grades, attendance, behavior) on a fishing trip to Canada for a week. This particular school has a F&R lunch rate of 83%. The director of the trip says that he would [i]estimate 70-80% of the students qualified are on F&R lunch. They asked for a donation to sponsor the event.

Is this considered a qualified investment? Do we have to have some sort of proof from the director that a majority of the trip's students are on F&R lunches, or can we use the fact that the school's rate is over 80%?

I'm just not sure how much documentation examiners will want from the school that say SPECIFICALLY how many students are on FR lunch programs for the event. Seems like if the majority of the students in the school are on the program, it would pass the test....

wb lewis - Is there an educational aspect to the trip, other than how to fish? Maybe they have life skills training, leadership activities, stuff like that. You really want to stay away from focusing on some kind of reward fishing trip up north. If there are ancillary learning activities during the week, and the fact you have a FRL ratio of 83%, you have a good shot at getting investment credit. Go along and have a session on financial education and you could also get service test credit.

Excellent advice!

Agreed. Unless it is directed towards only LMI individuals and is a free program, then it would be very hard to qualify that specific one.

I've got a high school that has 45% of students on FRL programs (district is over 50%, high schools are always lower) and in a distressed county. We did a teach children to save day for the 10-12th grades...would you try and count it (distressed county) even though the HS technically had less than 50%?

This is also a question about schools. What can be done to qualify a community college loan? I know F/R would not apply here. What if you had number and percentage of LMI that the school serves? If it is a majority, could this qualify for a CD loan? I would think so but I wasn't sure what the process would be to go about this. Thank you.

Jen I think I would present that one. Usually for schools I stick to the >50% but the fact the county is distressed, might negate that last 5%.

Kansas-- for college loans and investments, we use the percentage of students that receive Pell Grants. You can find that information here.

Thank you Compliant! I am still relatively new. I appreciate the help.

You're welcome Kansas! When I started in compliance 3 years ago, I was in this forum constantly. I learned so much from everyone here. I'm happy to pass some along!!

One more question Compliant. Would the threshold to qualify be 51% or higher for pell grants at the university or college? I notice that most of the % are around 30% or so. I didn't know if there was a cutoff and wanted to confirm. Thank you!

Thanks Okie!

I've been using anything over 50% for pell grants and school lunches. Even 50.4%! I've found that larger universities have lower numbers of students on Pell grants. The Junior or technical schools are much higher.

Here's the main "thing" with the over 50% - that is your "safe harbor" to prove the the donations, services or loans are benefiting low-mod individuals. If you have less than 50%, then you have more work to do to document that your Community Development initiative (donation, investment, service, credit) is benefiting low-mod.

You may need documentation from the school that only children that are in the free or subsidized lunch program are in the classes - or perhaps the percentage of those children that are benefiting, and you may able to claim a proportionate percentage of your activity. For instance, you donate $1,000 for a school program and you get documentation from the school that 40% of the children in that program are in the free or subsidized lunch program - then you could get credit for $400 of that donation.

It's a lot more work to have the documentation all tied up in a nice neat package with a bow on top for the examiner to review which is why most institutions just stick with the over 50% marker. However, if you don't have those types of schools in your AA, then you need to get creative and thorough.

Ditto Jen. I'll use 50.1%.

That's good advice PR. Sometimes when we work with Boys and Girls Clubs or a similar group, we use the surrounding schools but also use the mission of the group to show that LMI children are the recipients of the service. Thus far, we've gotten credit for all our Boys and Girls Club services.

Thank you Jen and Compliant. That would make sense to me. Much appreciated! Happy 4th to all.