SALT LAKE CITY — Utah benefits from a high concentration of commercial banks, industrial banks, and other financial institutions that engage in Community Reinvestment Act (CRA) activities throughout the state. A new report from the Kem C. Gardner Policy Institute summarizes Utah’s community needs that can be addressed by CRA activities, including the needs of low- and moderate-income individuals, small businesses, and the general community.
The U.S. Congress passed the Community Reinvestment Act in 1977 to encourage commercial banks and savings associations to help meet the credit needs of all parts of their communities, including low- and moderate-income neighborhoods. CRA promotes fair access to financial services, fostering economic growth and stability in underserved areas. The act benefits residents of these communities by improving their access to loans, mortgages, and banking resources, thereby supporting their financial well-being and community development.
“Despite Utah’s economic strength, local community needs assessments surface challenges related to affordable housing and other issues,” said Nate Lloyd, director of economic research at the Gardner Institute and lead author of the study. “This report’s economic and demographic context and summary of community needs will serve as critical resources for banks and others interested in meeting community needs.”
Key findings from the report include the following:
Strong economy – Economic indicators such as employment growth and the unemployment rate establish Utah’s economic strength relative to the U.S. economy coming out of the pandemic-induced recession of 2020 and continuing to the present.
Affordable housing – Despite Utah’s economic strength, most local community needs assessments surface challenges related to affordable housing throughout the state. This challenge and general housing affordability concerns impact quality of life and economic mobility in Utah.
Housing market challenges – Utah experiences continued housing demand driven by strong economic fundamentals, as well as population and household growth. Decreases in recent years of construction-permitted residential units imply a slowing rate of increase in the state’s housing supply.
Poverty – While poverty rates in Utah are lower than average U.S. rates, needs assessments highlight the community service needs among low- and moderate-income individuals and others, such as food security, affordable utilities and internet, affordable childcare, health care access, and more.
Small businesses – Small businesses throughout Utah experience heightened vulnerability due to shifting U.S. trade policy. About 70% of a recent survey’s respondents report concerns about tariffs, primarily due to the anticipated need to restructure their supply chains.
Other concerns – Other top concerns cited in community needs assessments include the maintenance and improvement of transportation, public facilities, water supply, and air quality.
“United by Utah’s legacy of financial innovation and community strength, we – community banks, industrial banks, fintech institutions, and special purpose banks – have come together to champion inclusive economic growth across our state,” said Kim Hannay, CRA officer, Optum Bank; CRA committee chair, Utah Bankers Association; and bank representative, Utah Association of Financial Services Foundation. “I believe this comprehensive community needs assessment illuminates both the resilience and the challenges within our diverse communities. As CRA professionals, we can leverage these insights to craft tailored strategies that reflect our distinct bank models and drive meaningful, measurable impact within the low- and moderate-income communities we serve.”
A full analysis of the report will be presented by Nate Lloyd at the Utah Bankers Association Community Reinvestment Act Conference on Thursday, September 25, at Optum Bank in Draper, Utah.
The full report is now available online.
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