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Michigan Chronicle

Vol. 86 – No. 31 | April 5-11, 2023

Biden-Harris Administration's Racial Equity Initiatives By Sherri Kolade With the expansion of the child tax credit, reducing the cost of child care, leveraging federal procurement to better assist Black-owned businesses and other initiatives, the Biden-Harris Administration is expanding financial chances for Black people. What does that actually mean in real life? Almost 40 million Americans live in poverty, according to the U.S. Department of Health and Human Services. The United States’ poverty rate was 10.5 percent in 2019, the lowest level since 1959, according to data from the U.S. Census Bureau. Without a doubt, COVID-19 has affected those figures. According to the poverty rate, from 1959 to 2019, Blacks and Hispanics have higher rates of poverty than other racial groups. Locally, a 2022 U.S Census study revealed that 14.1 percent of Michigan residents live in poverty; in Wayne County, 21.7 percent of residents live in poverty. There are still racial imbalances in the US, which makes it difficult for Black individuals to achieve. Yet, a recent report lists the states with the highest levels of racial inequality. “Current trends show that a wide financial gulf continues to divide racial groups in the U.S., with Hispanic and Black Americans still at the bottom of the economic ladder,” according to WalletHub, a financial website. The Biden-Harris administration sincerely hopes to address these and more problems with inequity through an executive order worked on at the beginning of President Joe Biden’s tenure. Through Executive Order 13985, officially titled Advancing Racial Equity and Support for Underserved Communities Through the Federal Government, the first executive order signed by Biden addresses inequitable policies and institutions head on that “too often deny equal opportunity to individuals and communities.” Since its one-year mark the Biden-Harris administration has: Brought child poverty to its lowest level on record in 2021 – with record low Black and Hispanic child poverty, through the expansion of the Child Tax Credit.

Silicon Valley Bank Fallout: What Detroit Bank Customers Need to Know

By Andrea Plaid Though Silicon Valley Bank was on the West Coast—and the fallout from it ripples through the financial sector across the United States--will its closing affect Black bank customers here in Detroit? Small banks, particularly those owned by minoritized people, are already feeling the repercussions. According to the Washington Post, some nervous customers are moving their money to larger banks like Bank of America. And small Black-owned banks are faring the worst because “most don’t have as much capital to withstand economic downturns,” the article stated. “The fallout of the bank makes me nervous because most people want to get their money during an emergency or crisis,” said Gwen Thomas in response to the Michigan Chronicle asking Detroiters their feeling about the situation. “However, I have an account stuck in Washington, D.C., at a major bank and I can’t seem to transfer the account to Michigan due to a major error that I could never get resolved upon moving back to [the state].”

Brought clean drinking water to 10 million American house-

Kenneth Kelly, the chairman and CEO of First Independence Bank and the immediate past chairman of the National Bank Association, an organization for financial institutions run by minoritized people, countered the Post’s claims.

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“In this case, I can say that the

Made Emergency Rental Assistance payments to over 4 million renters, 80 percent of whom make below 30 percent of the area median income.

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she said that the institution had a few customer inquiries but lost none of its clientele. The upside of the fallout is that “we received a few new accounts from businesses and organizations that are seeking to diversify their banking relationships.” “We hope that more businesses and organizations will consider Black-owned banks.”

Teri Williams, president and COO of OneUnited Bank in Boston, and Kenneth Kelly, chairman and CEO of First Independence Bank in Detroit. preliminary review of the factors impacting Silicon Valley Bank and First Independence Bank are not directly indicative of the banking industry.” As for First Independence Bank itself, Kelly stated that they have built “a very solid capital base by raising $66 million in equity that has created unprecedented strength” in the last couple of years. The institution also developed partnerships and received investments from the top five banks in the country, Kelly said, which allowed First Independence Bank to expand its offerings and services to its customers. Only about 10 customers have expressed concern over what’s happening with Silicon Valley Bank, he said. Their major concern was “if we have high concentrations in our business and, secondly, [they] want to consider how to di-

versify their banking relationships.” When the Michigan Chronicle asked Kelly if Black-owned banks and other institutions will face more scrutiny because of what happened with Silicon Valley Bank, he replied, “There are less than 20 African American-owned banks in the United States out of approximately 4800 banks. The number in itself suggests that there is a lack of representation and resources for African Americans in banking and finance. “I expect equality in scrutiny, but it is likely that we will not be fortunate to receive the same level of scrutiny.” Teri Williams, president and chief operating officer of OneUnited Bank headquartered in Boston, said her bank is not feeling any direct effects from Silicon Valley Bank’s closure and scrutiny. Like Kelly,

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City Council on Tuesday, March 28, approved a $167 million Community Benefits Agreement (CBA), among other projects tied to Olympia Development of Michigan and The Related Companies, in a joint endeavor to develop the $1.5 billion District Detroit. The approval came after hours of public comments and discussions that resulted in the Council voting 8-1 to advance the request of the two partnering companies. The solo “no” vote was by Council President Mary Sheffield. In a statement by Sheffield, she made it clear that she is not “anti-business.”

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$616 million transformational brownfield redevelopment plan over a 35-year period, which will still need approval by the state.

Senior Writer, Real Times Media

How to Celebrate the Official Start of Baseball Season in Detroit

Those lost relationships have become engulfed in the conservatives’ ongoing culture war against diversity, equity and inclusion, or DEI. However, the article states, banking experts counter with the fact that “the bank slid into insolvency because its larger customers pulled deposits rather than borrow at higher interest rates and the bank’s balance sheets were overexposed forcing it to sell bonds at a loss to cover the withdrawals.” The bank and its clients’ financial

District Detroit’s Neighborhood Advisory Committee Benefits Deal Approved By Donald James

Opening Day

Silicon Valley Bank’s closure worried its own customers of color. According to the Post, the bank’s former Black clientele—all start-up founders, and some immigrants—used that financial institution because the larger banks refused to work with them, citing that the founders “weren’t a good fit.” On the other hand, smaller banks like Silicon Valley Bank developed relationships with founders of color; now, those business relationship are gone. In the process, public trust in smaller banks dissolves, the Post states.

“I have literally, after fighting for more guarantees for Detroiters, voted for almost every

major development deal over my nine plus years on City Council,” the Council President’s statement said. “Standing on principle is not synonymous with stamping down progress. This model of developing our City has been the norm over the last 40 years and we’ve see nothing but

the proliferation of poverty, the loss of population, the obliteration of Black businesses and the systematic exclusion of Detroiters with respect to ownership and equity! I, for one, can no longer continue with business as usual.” City Council also approved a

Local media outlets report “Of the $616 million in tax dollars to be captured by the developers, about $400 million is to come from future state-level taxes, including state income taxes paid by workers and residents in the planned buildings. The balance would come from future property taxes that would otherwise go to the Downtown Development Authority (DDA). In addition, the Ilitch’s Olympia and Related Companies have agreed to make combined payments totaling $350,000 a year for the next decade, to provide affordable housing for Detroiters, including those with Section 8 vouchers.” City Council’s approval is

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