14 Organizations Call for Expanding Massachusetts State CRA to Include Climate Investments

March 18, 2026

Commissioner Mary L. Gallagher
Division of Banks
One Federal Street
Suite 710
Boston, MA 02110-2012

Dear Commissioner Gallagher,

Thank you for your attention to the role financial institutions play in meeting the credit needs of the communities where they operate through the examination of state chartered banks, credit unions, and mortgage lenders under the Massachusetts Community Reinvestment Act (CRA). Given the growing impacts of climate change, particularly on low- and moderate-income (LMI) communities, the undersigned organizations and financial institutions encourage the Division of Banks to include climate mitigation and adaptation investments as eligible investments under the Massachusetts CRA. 

Worsening climate disasters as well as chronic climate change impacts threaten the availability of financial services in climate vulnerable geographies. Financial institutions are increasingly withdrawing from climate vulnerable communities in an effort to manage their risk, a practice we expect will accelerate as climate change impacts grow. At a hearing before the U.S. Senate Committee on Banking, Housing, and Urban Affairs last year, Federal Reserve Chair Jerome Powell testified “If you fast forward 10 or 15 years, there will be regions of the country where you can’t get a mortgage, there won’t be ATMs, banks won’t have branches and things like that.” While withdrawing from communities can help financial institutions manage their exposure to climate risks in the short-run, withdrawal does nothing to reduce climate risk in the financial system over the long term. Moreover, this practice deprives communities of essential financial services that they need to build climate resilience, risks violations of fair lending laws, and exacerbates economic and racial inequality.

The impact of climate change on the availability of financial services is not felt equally across communities. Due to a history of systemic exclusion, including redlining, low-income communities and communities of color are overrepresented in climate-vulnerable areas. LMI communities face greater flood risk and are more exposed to extreme heat than their middle- and upper-income counterparts. Following a climate disaster, LMI communities have fewer resources and less credit access to make needed repairs. Bluelining, or the practice of limiting credit creation and investment in climate-vulnerable areas, often leads to further financial exclusion and magnifies existing inequalities and barriers to traditional finance for LMI communities and communities of color. 

Given the disproportionate impacts of climate change on LMI communities and the role of bluelining in exacerbating existing credit barriers, climate-related investments in these communities should be eligible for CRA credit. Eligible investments should extend to both climate mitigation—investments that reduce greenhouse gas emissions—and climate adaptation—investments that make property and communities more resilient to the impacts of climate change [1]. In New York and Illinois, climate-related investments in LMI communities are already eligible under the state’s CRA. As detailed in a 2021 Industry Letter published by the New York State Department of Financial Services, institutions subject to the New York CRA may receive credit for community development lending or qualified investments related to climate mitigation and adaptation. In Illinois, climate-related product offerings and investments targeted towards LMI communities, including those related to climate resilience and mitigating environmental harm, are included as examples of community development activities eligible for credit under the state’s CRA rule [2]. 

Expanding eligible investments under the Massachusetts CRA to include climate mitigation and adaptation activities is well within the Division of Banks’ authority. The change would not subject covered institutions to any new requirements; instead, it would expand the types of activities covered institutions can pursue for CRA credit. This change can be communicated to covered institutions through an industry letter as examples of activities that revitalize or stabilize CRA-eligible census tracts and does not require amending the state CRA rule. 

Massachusetts has made addressing climate change a priority. The state has set science-aligned emissions reduction milestones, including a commitment to achieving net-zero emissions by 2050 and prioritized assessing and improving the state’s resilience to climate-related impacts. Including climate change-related investments as eligible for CRA credit will support the state’s emissions reduction and climate resilience goals and incentivize extending needed investment to the LMI communities and communities of color most impacted by climate change.

Thank you for your attention to this important issue. We welcome the opportunity for further engagement on this topic and collaboration with the Division to address climate change-related impacts to communities in Massachusetts. 

 

Sincerely,

Public Citizen
National Community Reinvestment Coalition
Alternatives for Community & Environment (ACE)
Amalgamated Bank
Americans for Financial Reform Education Fund
CommonWealth Kitchen
Dorchester Bay Economic Development Corporation
Earth Ethics, Inc.
Green America
Local Enterprise Assistance Fund (LEAF)
Massachusetts Affordable Homeownership Alliance (MAHA)
Massachusetts Association of Community Development Corporations (MACDC)
RCAP Solutions, Inc.
The Greenlining Institute 

[1] Examples of climate mitigation investments include but are not limited to investments in rooftop or community solar solar, heatpumps, appliance electrification, and energy efficiency upgrades. Examples of climate adaptation investments include but are not limited to investments in flood mitigation, home hardening, and greening infrastructure.
[2] 38 Ill. Admin. Code § 345 APPENDIX C