Goode targets banks' service to minorities

City Councilman W. Wilson Goode Jr.'s crusade to force big banks to better serve minorities will result in one institution's being stripped of its city deposits and two others being declared ineligible for deposits, city officials said yesterday.

City Treasurer Rebecca Rhynhart said the city would remove its deposits from BNY Mellon, which on any given day holds $2 million to $4 million of city money.

The bank is used by the Board of Pensions and Retirement to write checks for retiree benefits. In the next few months, those deposits will move to Bank of America, Rhynhart said.

BNY Mellon, based in New York, did not contest Rhynhart's decision but defended its record.

"BNY Mellon makes community-development loans and investments available for multifamily affordable rental housing in Philadelphia," spokesman Mike Dunn said. He noted that the bank was rated "outstanding" for community reinvestment in Philadelphia by the U.S. Office of the Comptroller of the Currency.

Rhynhart said BNY Mellon did not submit a strategic plan in 2008 and 2009 describing how it would match or exceed the performance of peer banks in lending in traditionally underserved, usually minority, communities. The plans are required by a 2002 city law Goode wrote.

At Council's regular meeting yesterday, Goode formalized Rhynhart's action by introducing a bill that would officially remove BNY Mellon from the list of banks eligible to hold city funds.

Also targeted in the bill were Sovereign Bank and Advance Bank. Those banks, however, do not have city deposits.

Goode has taken similar action before. In 2003, he reduced the list of eligible banks to six from 30.

He said banks seeking reinstatement would need Council approval.

"I would rather take them through the reauthorization process than have them hanging out in limbo," he said.

Less than two hours after introducing the banking bill, Goode was back in Council chambers on the enforcement of minority-hiring requirements for city contractors.

Council's Commerce and Economic Development Committee, which Goode chairs, approved a bill of his that would codify Council's role in enforceing equal-opportunity plans.

Under Goode's bill, major city contractors must to submit plans establishing minority hiring and contracting goals, and Council would have a wider role in calling contractors to testify about their achieving those goals.

No contractor has ever been debarred from city contracts for failing to live up to an equal-opportunity plan, but Council would have an official role in recommending debarment. The mayor would retain debarment authority.

"It will mean something even if people are just brought in to City Council to face debarment charges," Goode said.

Councilwoman Blondell Reynolds Brown predicted that Council's role would "move the needle" on enforcement.

Councilman Bill Green chastised Kevin Dow, chief operations officer in the Commerce Department, for the lack of enforcement of equal-opportunity standards.