So, I'm having a difficult time explaining CD activity to some of our veteran bankers.

They are having difficulties understanding the qualifiers for what is and is not considered a community development activity (mainly the financial aspect). For example, they believe that sponsoring an event where children are exposed to a symphony should qualify as a community development service.

Down to the question at hand:

Were the CD Activity rules pretty loose and free prior to the 2010 Q&A? I'm trying to figure out where they are getting this notion that everything should count.

I always consider CRA a creative writing assignment. With the right "spin" you might receive credit.

I've worked for banks that received credit for donations to organizations that provided opportunities for LMI children to visit museums and other cultural events including symphonies.

5 ways that arts can improve struggling communities:

http://www.pps.org/reference/artsprojects/

But then again you can have examiners tell you no culture or sports will qualify. It is a cr@p shoot.

There really is no consistency. "Arts" can qualify if you can demonstrate a tie in. Arts activities that are contributing to community revitalization are probably the easiest to qualify.

For children's activities, I would look for statistics and articles that show that music and dance activities keep kids in school and improve grades and therefore work to improve the economic status of the child and the family, and can even improve the neighborhood by higher graduation rates.

Almost any kind of service will qualify if you can prove it primarily benefits low- or moderate-income families or individuals. Social services, daycare, medical services, educational services, etc. Exposing inner-city poor children children to the arts should qualify under education.

This regulation is the biggest bunch of [censored].

Norman Paperman,

Agreed. This regulation is not straightforward. If it were, we wouldn't be posting all these questions to try and figure it all out. A supreme waste of time in my opinion. I wish I had a nickel for every minute I spent researching some issue related to CRA..........and for the time I've spent trying to explain it to bank employees and management.

CRA Program = [censored]

My two cents. If you think it might be CRA-related (whether you're talking CD loans, investments, or service), put together a packet documenting your reasoning why it counts as CRA credit, where the money is going, a description of the borrower/organization, information regarding it's mission/purpose, census tract info (if it supports your case), its clientele (definitely documenting LMI status), etc. It shouldn't take much time. Worst case scenario, it's declined. Best case, it's approved and you have one more credit that you didn't have before.

In my experience, CRA examiners tend to be reasonable (if you put together an organized, logical case) and will work with you.

The struggle is dealing with the ambiguity and trying to direct future service efforts within what can count for credit.

I always say that CRA is a creative writing assignment.