Federal Register / Vol. 83, No. 166 / Monday, August 27, 2018 / Rules and Regulations 43503 

persons were invited to attend the 

meetings and participate in Committee 

deliberations on all issues. Like all 

Committee meetings, the March 15, 

2018, meeting was a public meeting and 

all entities, both large and small, were 

able to express views on this issue. 

In accordance with the Paperwork 

Reduction Act of 1995 (44 U.S.C. 

Chapter 35), the Order’s information 

collection requirements have been 

previously approved by the OMB and 

assigned OMB No. 0581–0178, 

Vegetable and Specialty Crops. No 

changes in those requirements are 

necessary as a result of this action. 

Should any changes become necessary, 

they would be submitted to OMB for 

approval. 

This rule imposes no additional 

reporting or recordkeeping requirements 

on either small or large Colorado potato 

handlers. As with all Federal marketing 

order programs, reports and forms are 

periodically reviewed to reduce 

information requirements and 

duplication by industry and public 

sector agencies. As mentioned in the 

initial regulatory flexibility analysis, 

USDA has not identified any relevant 

Federal rules that duplicate, overlap, or 

conflict with this final rule. 

AMS is committed to complying with 

the E-Government Act, to promote the 

use of the internet and other 

information technologies to provide 

increased opportunities for citizen 

access to Government information and 

services, and for other purposes. 

A proposed rule concerning this 

action was published in the Federal 

Register on May 24, 2018 (83 FR 24045). 

A copy of the proposed rule was 

provided to the handlers by the 

Committee. Finally, the proposal was 

made available through the internet by 

USDA and the Office of the Federal 

Register. A 30-day comment period 

ending June 25, 2018, was provided for 

interested persons to respond to the 

proposal. No comments were received. 

A small business guide on complying 

with fruit, vegetable, and specialty crop 

marketing agreements and orders may 

be viewed at: http://www.ams.usda.gov/ 

rules-regulations/moa/small-businesses. 

Any questions about the compliance 

guide should be sent to Richard Lower 

at the previously mentioned address in 

the FOR FURTHER INFORMATION CONTACT

section. 

After consideration of all relevant 

material presented, including the 

information and recommendation 

submitted by the Committee and other 

available information, it is hereby found 

that this rule will tend to effectuate the 

declared policy of the Act. 

List of Subjects in 7 CFR Part 948 

Marketing agreements, Potatoes, 

Reporting and recordkeeping 

requirements. 

For the reasons set forth in the 

preamble, 7 CFR part 948 is amended as 

follows: 

PART 948—IRISH POTATOES GROWN 

IN COLORADO 

■ 1. The authority citation for 7 CFR 

part 948 continues to read as follows: 

Authority: 7 U.S.C. 601–674. 

■ 2. Section 948.216 is revised to read 

as follows: 

§ 948.216 Assessment rate. 

On and after September 1, 2018, an 

assessment rate of $0.006 per 

hundredweight is established for 

Colorado Area No. 2 potatoes. 

Dated: August 22, 2018 

Bruce Summers, 

Administrator, Agricultural Marketing 

Service. 

[FR Doc. 2018–18560 Filed 8–24–18; 8:45 am] 

BILLING CODE 3410–02–P 

BUREAU OF CONSUMER FINANCIAL 

PROTECTION 

12 CFR Part 1026 

Truth in Lending (Regulation Z) Annual 

Threshold Adjustments (Credit Cards, 

HOEPA, and Qualified Mortgages) 

AGENCY: Bureau of Consumer Financial 

Protection. 

ACTION: Final rule; official 

interpretation. 

SUMMARY: The Bureau of Consumer 

Financial Protection (Bureau) is issuing 

this final rule amending the regulation 

text and official interpretations for 

Regulation Z, which implements the 

Truth in Lending Act (TILA). The 

Bureau is required to calculate annually 

the dollar amounts for several 

provisions in Regulation Z; this final 

rule revises, as applicable, the dollar 

amounts for provisions implementing 

TILA and amendments to TILA, 

including under the Credit Card 

Accountability Responsibility and 

Disclosure Act of 2009 (CARD Act), the 

Home Ownership and Equity Protection 

Act of 1994 (HOEPA), and the DoddFrank Wall Street Reform and Consumer 

Protection Act (Dodd-Frank Act). The 

Bureau is adjusting these amounts, 

where appropriate, based on the annual 

percentage change reflected in the 

Consumer Price Index (CPI) in effect on 

June 1, 2018. 

DATES: This final rule is effective 

January 1, 2019. 

FOR FURTHER INFORMATION CONTACT: 

Monique Chenault, Paralegal, and 

Shelley Thompson, Counsel, Office of 

Regulations, at (202) 435–7700. If you 

require this document in an alternative 

electronic format, please contact CFPB_

Accessibility@cfpb.gov. 

SUPPLEMENTARY INFORMATION: The 

Bureau is amending the regulation text 

and official interpretations for 

Regulation Z, which implements TILA, 

to update the dollar amounts of various 

thresholds that are adjusted annually 

based on the annual percentage change 

in the CPI as published by the Bureau 

of Labor Statistics (BLS). Specifically, 

for open-end consumer credit plans 

under TILA, the threshold that triggers 

requirements to disclose minimum 

interest charges will remain unchanged 

at $1.00 in 2019. For open-end 

consumer credit plans under the CARD 

Act amendments to TILA, the adjusted 

dollar amount in 2019 for the safe 

harbor for a first violation penalty fee 

will increase by $1 to $28 and the 

adjusted dollar amount for the safe 

harbor for a subsequent violation 

penalty fee will increase by $1 to $39. 

For HOEPA loans, the adjusted total 

loan amount threshold for high-cost 

mortgages in 2019 will be $21,549. The 

adjusted points-and-fees dollar trigger 

for high-cost mortgages in 2019 will be 

$1,077. For qualified mortgages, which 

receive certain protections from liability 

under the ability-to-repay rule, the 

maximum thresholds for total points 

and fees in 2019 will be 3 percent of the 

total loan amount for a loan greater than 

or equal to $107,747; $3,232 for a loan 

amount greater than or equal to $64,648 

but less than $107,747; 5 percent of the 

total loan amount for a loan greater than 

or equal to $21,549 but less than 

$64,648; $1,077 for a loan amount 

greater than or equal to $13,468 but less 

than $21,549; and 8 percent of the total 

loan amount for a loan amount less than 

$13,468. 

I. Background 

A. Credit Card Annual Adjustments 

Minimum Interest Charge Disclosure 

Thresholds 

Sections 1026.6(b)(2)(iii) and 

1026.60(b)(3) of Regulation Z implement 

sections 127(a)(3) and 127(c)(1)(A)(ii)(II) 

of TILA. Sections 1026.6(b)(2)(iii) and 

1026.60(b)(3) require the disclosure of 

any minimum interest charge exceeding 

$1.00 that could be imposed during a 

billing cycle and provide that, for openend consumer credit plans, the 

minimum interest charge thresholds 


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1Credit Card Accountability Responsibility and 

Disclosure Act of 2009, Public Law 111–24, 123 

Stat. 1734 (2009). 

2 Dodd-Frank Wall Street Reform and Consumer 

Protection Act, Public Law 111–203, 124 Stat. 1376 

(2010). 

will be re-calculated annually using the 

CPI that was in effect on the preceding 

June 1; the Bureau uses the Consumer 

Price Index for Urban Wage Earners and 

Clerical Workers (CPI–W) for this 

adjustment. When the cumulative 

change in the adjusted minimum value 

derived from applying the annual CPI– 

W level to the current amounts in 

§§ 1026.6(b)(2)(iii) and 1026.60(b)(3) has 

risen by a whole dollar, the minimum 

interest charge amounts set forth in the 

regulation will be increased by $1.00. 

The BLS publishes consumer-based 

indices monthly but does not report a 

CPI change on June 1; adjustments are 

reported in the middle of the month. 

This adjustment analysis is based on the 

CPI–W index in effect on June 1, 2018, 

which was reported by BLS on May 10, 

2018, and reflects the percentage change 

from April 2017 to April 2018. The CPI– 

W is a subset of the Consumer Price 

Index for All Urban Consumers (CPI–U) 

index and represents approximately 29 

percent of the U.S. population. The 

adjustment analysis accounts for a 2.6 

percent increase in the CPI–W from 

April 2017 to April 2018. This increase 

in the CPI–W when applied to the 

current amounts in §§ 1026.6(b)(2)(iii) 

and 1026.60(b)(3) did not trigger an 

increase in the minimum interest charge 

threshold of at least $1.00, and the 

Bureau is therefore not amending 

§§ 1026.6(b)(2)(iii) and 1026.60(b)(3). 

Safe Harbor Penalty Fees 

Section 1026.52(b)(1)(ii)(A) and (B) of 

Regulation Z implements section 149(e) 

of TILA, established by the CARD Act.1

Section 1026.52(b)(1)(ii)(D) provides 

that the safe harbor provision, which 

establishes the permissible penalty fee 

thresholds in § 1026.52(b)(1)(ii)(A) and 

(B), will be re-calculated annually using 

the CPI that was in effect on the 

preceding June 1; the Bureau uses the 

CPI–W for this adjustment. When the 

cumulative change in the adjusted value 

derived from applying the annual CPI– 

W level to the current amounts in 

§ 1026.52(b)(1)(ii)(A) and (B) has risen 

by a whole dollar, those amounts will be 

increased by $1.00. Similarly, when the 

cumulative change in the adjusted value 

derived from applying the annual CPI– 

W level to the current amounts in 

§ 1026.52(b)(1)(ii)(A) and (B) has 

decreased by a whole dollar, those 

amounts will be decreased by $1.00. See 

comment 52(b)(1)(ii)–2. The 2019 

adjustment analysis is based on the CPI– 

W index in effect on June 1, 2018, 

which was reported by BLS on May 10, 

2018, and reflects the percentage change 

from April 2017 to April 2018. The 

adjustment to the permissible fee 

thresholds being adopted here reflects a 

2.6 percent increase in the CPI–W from 

April 2017 to April 2018 and is rounded 

to the nearest $1 increment. 

B. HOEPA Annual Threshold 

Adjustments 

Section 1026.32(a)(1)(ii) of Regulation 

Z implements section 1431 of the DoddFrank Act,2 which amended the HOEPA 

points-and-fees coverage test. Under 

§ 1026.32(a)(1)(ii)(A) and (B), when 

determining whether a transaction is a 

high-cost mortgage, the determination of 

the applicable points-and-fees coverage 

test depends on whether the total loan 

amount is for $20,000 or more, or for 

less than $20,000. Section 

1026.32(a)(1)(ii) provides that this 

threshold amount be recalculated 

annually using the CPI index in effect 

on June 1; the Bureau uses the CPI–U for 

this adjustment. The CPI–U is based on 

all urban consumers and represents 

approximately 93 percent of the U.S. 

population. The 2019 adjustment is 

based on the CPI–U index in effect on 

June 1, which was reported by BLS on 

May 10, 2018, and reflects the 

percentage change from April 2017 to 

April 2018. The adjustment to the 

$20,000 figure being adopted here 

reflects a 2.5 percent increase in the 

CPI–U index for this period and is 

rounded to whole dollars for ease of 

compliance. 

Under § 1026.32(a)(1)(ii)(B) the 

HOEPA points-and-fees dollar trigger is 

$1,000. Section 1026.32(a)(1)(ii)(B) 

provides that this threshold amount will 

be recalculated annually using the CPI 

index in effect on June 1; the Bureau 

uses the CPI–U for this adjustment. The 

2019 adjustment is based on the CPI–U 

index in effect on June 1, 2018, which 

was reported by BLS on May 10, 2018, 

and reflects the percentage change from 

April 2017 to April 2018. The 

adjustment to the $1,000 figure being 

adopted here reflects a 2.5 percent 

increase in the CPI–U index for this 

period and is rounded to whole dollars 

for ease of compliance. 

C. Qualified Mortgages Annual 

Threshold Adjustments 

The Bureau’s Regulation Z 

implements sections 1411 and 1412 of 

the Dodd-Frank Act, which generally 

require creditors to make a reasonable, 

good-faith determination of a 

consumer’s ability to repay any 

consumer credit transaction secured by 

a dwelling and establishes certain 

protections from liability under this 

requirement for qualified mortgages. 

Under § 1026.43(e)(3)(i), a covered 

transaction is not a qualified mortgage if 

the transaction’s total points and fees 

exceed: 3 percent of the total loan 

amount for a loan amount greater than 

or equal to $100,000; $3,000 for a loan 

amount greater than or equal to $60,000 

but less than $100,000; 5 percent of the 

total loan amount for loans greater than 

or equal to $20,000 but less than 

$60,000; $1,000 for a loan amount 

greater than or equal to $12,500 but less 

than $20,000; or 8 percent of the total 

loan amount for loans less than $12,500. 

Section 1026.43(e)(3)(ii) provides that 

the limits and loan amounts in 

§ 1026.43(e)(3)(i) are recalculated 

annually for inflation using the CPI–U 

index in effect on June 1. The 2019 

adjustment is based on the CPI–U index 

in effect on June 1, 2018, which was 

reported by BLS on May 10, 2018, and 

reflects the percentage change from 

April 2017 to April 2018. The 

adjustment to the 2018 figures being 

adopted here reflects a 2.5 percent 

increase in the CPI–U index for this 

period and is rounded to whole dollars 

for ease of compliance. 

II. Adjustment and Commentary 

Revision 

A. Credit Card Annual Adjustments 

Minimum Interest Charge Disclosure 

Thresholds—§§ 1026.6(b)(2)(iii) and 

1026.60(b)(3) 

The minimum interest charge 

amounts for §§ 1026.6(b)(2)(iii) and 

1026.60(b)(3) will remain unchanged at 

$1.00 for the year 2019. Accordingly, 

the Bureau is not amending these 

sections of Regulation Z. 

Safe Harbor Penalty Fees— 

§ 1026.52(b)(1)(ii)(A) and (B) 

Effective January 1, 2019, the 

permissible fee threshold amounts 

increased by $1 and are $28 for 

§ 1026.52(b)(1)(ii)(A) and $39 for 

§ 1026.52(b)(1)(ii)(B). Accordingly, the 

Bureau is revising § 1026.52(b)(1)(ii)(A) 

and (B) to state that the fee imposed for 

violating the terms or other 

requirements of an account shall not 

exceed $28 and $39 respectively. The 

Bureau is also amending comment 

52(b)(1)(ii)–2.i to preserve a list of the 

historical thresholds for this provision. 

B. HOEPA Annual Threshold 

Adjustment—Comments 32(a)(1)(ii)–1 

and –3 

Effective January 1, 2019, for purposes 

of determining under § 1026.32(a)(1)(ii) 


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the points-and-fees coverage test under 

HOEPA to which a transaction is 

subject, the total loan amount threshold 

is $21,549, and the adjusted points-andfees dollar trigger under 

§ 1026.32(a)(1)(ii)(B) is $1,077. When 

the total loan amount for a transaction 

is $21,549 or more, and the points-andfees amount exceeds 5 percent of the 

total loan amount, the transaction is a 

high-cost mortgage. When the total loan 

amount for a transaction is less than 

$21,549, and the points-and-fees 

amount exceeds the lesser of the 

adjusted points-and-fees dollar trigger of 

$1,077 or 8 percent of the total loan 

amount, the transaction is a high-cost 

mortgage. The Bureau is amending 

comments 32(a)(1)(ii)–1 and –3, which 

list the adjustments for each year, to 

reflect for 2019 the new loan amount 

dollar threshold and the new pointsand-fees dollar trigger, respectively. 

C. Qualified Mortgages Annual 

Threshold Adjustments 

Effective January 1, 2019, a covered 

transaction is not a qualified mortgage 

if, pursuant to § 1026.43(e)(3), the 

transaction’s total points and fees 

exceed 3 percent of the total loan 

amount for a loan amount greater than 

or equal to $107,747; $3,232 for a loan 

amount greater than or equal to $64,648 

but less than $107,747; 5 percent of the 

total loan amount for loans greater than 

or equal to $21,549 but less than 

$64,648; $1,077 for a loan amount 

greater than or equal to $13,468 but less 

than $21,549; or 8 percent of the total 

loan amount for loans less than $13,468. 

The Bureau is amending comment 

43(e)(3)(ii)–1, which lists the 

adjustments for each year, to reflect the 

new dollar threshold amounts for 2019. 

III. Procedural Requirements 

A. Administrative Procedure Act 

Under the Administrative Procedure 

Act, notice and opportunity for public 

comment are not required if the Bureau 

finds that notice and public comment 

are impracticable, unnecessary, or 

contrary to the public interest. 5 U.S.C. 

553(b)(B). Pursuant to this final rule, in 

Regulation Z, § 1026.52(b)(1)(ii)(A) and 

(B) in subpart G is amended and 

comments 32(a)(1)(ii)–1.v and –3.v, 

43(e)(3)(ii)–1.v, and 52(b)(1)(ii)–2.i.F in 

Supplement I are added to update the 

exemption thresholds. The amendments 

in this final rule are technical and nondiscretionary, as they merely apply the 

method previously established in 

Regulation Z for determining 

adjustments to the thresholds. For these 

reasons, the Bureau has determined that 

publishing a notice of proposed 

rulemaking and providing opportunity 

for public comment are unnecessary. 

The amendments therefore are adopted 

in final form. 

B. Regulatory Flexibility Act 

Because no notice of proposed 

rulemaking is required, the Regulatory 

Flexibility Act does not require an 

initial or final regulatory flexibility 

analysis. 5 U.S.C. 603(a), 604(a). 

C. Paperwork Reduction Act 

In accordance with the Paperwork 

Reduction Act of 1995 (44 U.S.C. 3506; 

5 CFR part 1320), the Bureau reviewed 

this final rule. No collections of 

information pursuant to the Paperwork 

Reduction Act are contained in the final 

rule. 

D. Congressional Review Act 

Pursuant to the Congressional Review 

Act (5 U.S.C. 801 et seq.), the Bureau 

will submit a report containing this rule 

and other required information to the 

United States Senate, the United States 

House of Representatives, and the 

Comptroller General of the United 

States prior to the rule taking effect. The 

Office of Information and Regulatory 

Affairs (OIRA) has designated this rule 

as not a ‘‘major rule’’ as defined by 5 

U.S.C. 804(2). 

List of Subjects in 12 CFR Part 1026 

Advertising, Consumer protection, 

Credit, Credit unions, Mortgages, 

National banks, Reporting and 

recordkeeping requirements, Savings 

associations, Truth in lending. 

Authority and Issuance 

For the reasons set forth in the 

preamble, the Bureau amends 

Regulation Z, 12 CFR part 1026, as set 

forth below: 

PART 1026—TRUTH IN LENDING 

(REGULATION Z) 

■ 1. The authority citation for part 1026 

continues to read as follows: 

Authority: 12 U.S.C. 2601, 2603–2605, 

2607, 2609, 2617, 3353, 5511, 5512, 5532, 

5581; 15 U.S.C. 1601 et seq. 

Subpart G—Special Rules Applicable 

to Credit Card Accounts and Open End 

Credit Offered to College Students 

■ 2. Amend § 1026.52 by revising 

paragraphs (b)(1)(ii)(A) and (B) to read 

as follows: 

§ 1026.52 Limitations on fees. 

* * * * * 

(b) * * * 

(1) * * * 

(ii) * * * 

(A) $28 

(B) $39 if the card issuer previously 

imposed a fee pursuant to paragraph 

(b)(1)(ii)(A) of this section for a violation 

of the same type that occurred during 

the same billing cycle or one of the next 

six billing cycles; or 

* * * * * 

■ 3. In Supplement I to Part 1026: 

■ a. Under Section 1026.32— 

Requirements for High-Cost Mortgages, 

Paragraph 32(a)(1)(ii) is revised. 

■ b. Under Section 1026.43—Minimum 

Standards for Transactions Secured by 

a Dwelling, Paragraph 43(e)(3)(ii) is 

revised. 

■ c. Under Section 1026.52— 

Limitations on Fees, 52(b)(1)(ii) Safe 

harbors is revised. 

The revisions read as follows: 

SUPPLEMENT I TO PART 1026—OFFICIAL 

INTERPRETATIONS 

* * * * * 

Section 1026.32—Requirements for High-Cost 

Mortgages 

* * * * * 

Paragraph 32(a)(1)(ii). 

1. Annual adjustment of $1,000 amount. 

The $1,000 figure in § 1026.32(a)(1)(ii)(B) is 

adjusted annually on January 1 by the annual 

percentage change in the CPI that was in 

effect on the preceding June 1. The Bureau 

will publish adjustments after the June 

figures become available each year. 

i. For 2015, $1,020, reflecting a 2 percent 

increase in the CPI–U from June 2013 to June 

2014, rounded to the nearest whole dollar. 

ii. For 2016, $1,017, reflecting a .2 percent 

decrease in the CPI–U from June 2014 to June 

2015, rounded to the nearest whole dollar. 

iii. For 2017, $1,029, reflecting a 1.1 

percent increase in the CPI–U from June 2015 

to June 2016, rounded to the nearest whole 

dollar. 

iv. For 2018, $1,052, reflecting a 2.2 

percent increase in the CPI–U from June 2016 

to June 2017, rounded to the nearest whole 

dollar. 

v. For 2019, $1,077, reflecting a 2.5 percent 

increase in the CPI–U from June 2017 to June 

2018, rounded to the nearest whole dollar. 

2. Historical adjustment of $400 amount. 

Prior to January 10, 2014, a mortgage loan 

was covered by § 1026.32 if the total points 

and fees payable by the consumer at or before 

loan consummation exceeded the greater of 

$400 or 8 percent of the total loan amount. 

The $400 figure was adjusted annually on 

January 1 by the annual percentage change in 

the CPI that was in effect on the preceding 

June 1, as follows: 

i. For 1996, $412, reflecting a 3.00 percent 

increase in the CPI–U from June 1994 to June 

1995, rounded to the nearest whole dollar. 

ii. For 1997, $424, reflecting a 2.9 percent 

increase in the CPI–U from June 1995 to June 

1996, rounded to the nearest whole dollar. 

iii. For 1998, $435, reflecting a 2.5 percent 

increase in the CPI–U from June 1996 to June 

1997, rounded to the nearest whole dollar. 


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iv. For 1999, $441, reflecting a 1.4 percent 

increase in the CPI–U from June 1997 to June 

1998, rounded to the nearest whole dollar. 

v. For 2000, $451, reflecting a 2.3 percent 

increase in the CPI–U from June 1998 to June 

1999, rounded to the nearest whole dollar. 

vi. For 2001, $465, reflecting a 3.1 percent 

increase in the CPI–U from June 1999 to June 

2000, rounded to the nearest whole dollar. 

vii. For 2002, $480, reflecting a 3.27 

percent increase in the CPI–U from June 2000 

to June 2001, rounded to the nearest whole 

dollar. 

viii. For 2003, $488, reflecting a 1.64 

percent increase in the CPI–U from June 2001 

to June 2002, rounded to the nearest whole 

dollar. 

ix. For 2004, $499, reflecting a 2.22 percent 

increase in the CPI–U from June 2002 to June 

2003, rounded to the nearest whole dollar. 

x. For 2005, $510, reflecting a 2.29 percent 

increase in the CPI–U from June 2003 to June 

2004, rounded to the nearest whole dollar. 

xi. For 2006, $528, reflecting a 3.51 percent 

increase in the CPI–U from June 2004 to June 

2005, rounded to the nearest whole dollar. 

xii. For 2007, $547, reflecting a 3.55 

percent increase in the CPI–U from June 2005 

to June 2006, rounded to the nearest whole 

dollar. 

xiii. For 2008, $561, reflecting a 2.56 

percent increase in the CPI–U from June 2006 

to June 2007, rounded to the nearest whole 

dollar. 

xiv. For 2009, $583, reflecting a 3.94 

percent increase in the CPI–U from June 2007 

to June 2008, rounded to the nearest whole 

dollar. 

xv. For 2010, $579, reflecting a 0.74 

percent decrease in the CPI–U from June 

2008 to June 2009, rounded to the nearest 

whole dollar. 

xvi. For 2011, $592, reflecting a 2.2 percent 

increase in the CPI–U from June 2009 to June 

2010, rounded to the nearest whole dollar. 

xvii. For 2012, $611, reflecting a 3.2 

percent increase in the CPI–U from June 2010 

to June 2011, rounded to the nearest whole 

dollar. 

xviii. For 2013, $625, reflecting a 2.3 

percent increase in the CPI–U from June 2011 

to June 2012, rounded to the nearest whole 

dollar. 

xix. For 2014, $632, reflecting a 1.1 percent 

increase in the CPI–U from June 2012 to June 

2013, rounded to the nearest whole dollar. 

3. Applicable threshold. For purposes of 

§ 1026.32(a)(1)(ii), a creditor must determine 

the applicable points and fees threshold 

based on the face amount of the note (or, in 

the case of an open-end credit plan, the 

credit limit for the plan when the account is 

opened). However, the creditor must apply 

the allowable points and fees percentage to 

the ‘‘total loan amount,’’ as defined in 

§ 1026.32(b)(4). For closed-end credit 

transactions, the total loan amount may be 

different than the face amount of the note. 

The $20,000 amount in § 1026.32(a)(1)(ii)(A) 

and (B) is adjusted annually on January 1 by 

the annual percentage change in the CPI that 

was in effect on the preceding June 1. 

i. For 2015, $20,391, reflecting a 2 percent 

increase in the CPI–U from June 2013 to June 

2014, rounded to the nearest whole dollar. 

ii. For 2016, $20,350, reflecting a .2 percent 

decrease in the CPI–U from June 2014 to June 

2015, rounded to the nearest whole dollar. 

iii. For 2017, $20,579, reflecting a 1.1 

percent increase in the CPI–U from June 2015 

to June 2016, rounded to the nearest whole 

dollar. 

iv. For 2018, $21,032, reflecting a 2.2 

percent increase in the CPI–U from June 2016 

to June 2017, rounded to the nearest whole 

dollar. 

v. For 2019, $21,549, reflecting a 2.5 

percent increase in the CPI–U from June 2017 

to June 2018, rounded to the nearest whole 

dollar. 

* * * * * 

Section 1026.43—Minimum Standards for 

Transactions Secured by a Dwelling 

* * * * * 

Paragraph 43(e)(3)(ii). 

1. Annual adjustment for inflation. The 

dollar amounts, including the loan amounts, 

in § 1026.43(e)(3)(i) will be adjusted annually 

on January 1 by the annual percentage 

change in the CPI–U that was in effect on the 

preceding June 1. The Bureau will publish 

adjustments after the June figures become 

available each year. 

i. For 2015, reflecting a 2 percent increase 

in the CPI–U that was reported on the 

preceding June 1, a covered transaction is not 

a qualified mortgage unless the transactions 

total points and fees do not exceed; 

A. For a loan amount greater than or equal 

to $101,953: 3 percent of the total loan 

amount; 

B. For a loan amount greater than or equal 

to $61,172 but less than $101,953: $3,059; 

C. For a loan amount greater than or equal 

to $20,391 but less than $61,172: 5 percent 

of the total loan amount; 

D. For a loan amount greater than or equal 

to $12,744 but less than $20,391; $1,020; 

E. For a loan amount less than $12,744: 8 

percent of the total loan amount. 

ii. For 2016, reflecting a .2 percent decrease 

in the CPI–U that was reported on the 

preceding June 1, a covered transaction is not 

a qualified mortgage unless the transactions 

total points and fees do not exceed; 

A. For a loan amount greater than or equal 

to $101,749: 3 percent of the total loan 

amount; 

B. For a loan amount greater than or equal 

to $61,050 but less than $101,749: $3,052; 

C. For a loan amount greater than or equal 

to $20,350 but less than $61,050: 5 percent 

of the total loan amount; 

D. For a loan amount greater than or equal 

to $12,719 but less than $20,350; $1,017; 

E. For a loan amount less than $12,719: 8 

percent of the total loan amount. 

iii. For 2017, reflecting a 1.1 percent 

increase in the CPI–U that was reported on 

the preceding June 1, a covered transaction 

is not a qualified mortgage unless the 

transactions total points and fees do not 

exceed: 

A. For a loan amount greater than or equal 

to $102,894: 3 percent of the total loan 

amount; 

B. For a loan amount greater than or equal 

to $61,737 but less than $102,894: $3,087; 

C. For a loan amount greater than or equal 

to $20,579 but less than $61,737: 5 percent 

of the total loan amount; 

D. For a loan amount greater than or equal 

to $12,862 but less than $20,579: $1,029; 

E. For a loan amount less than $12,862: 8 

percent of the total loan amount. 

iv. For 2018, reflecting a 2.2 percent 

increase in the CPI–U that was reported on 

the preceding June 1, a covered transaction 

is not a qualified mortgage unless the 

transaction’s total points and fees do not 

exceed: 

A. For a loan amount greater than or equal 

to $105,158: 3 percent of the total loan 

amount; 

B. For a loan amount greater than or equal 

to $63,095 but less than $105,158: $3,155; 

C. For a loan amount greater than or equal 

to $21,032 but less than $63,095: 5 percent 

of the total loan amount; 

D. For a loan amount greater than or equal 

to $13,145 but less than $21,032: $1,052; 

E. For a loan amount less than $13,145: 8 

percent of the total loan amount. 

v. For 2019, reflecting a 2.5 percent 

increase in the CPI–U that was reported on 

the preceding June 1, a covered transaction 

is not a qualified mortgage unless the 

transaction’s total points and fees do not 

exceed: 

A. For a loan amount greater than or equal 

to $107,747: 3 percent of the total loan 

amount; 

B. For a loan amount greater than or equal 

to $64,648 but less than $107,747: $3,232; 

C. For a loan amount greater than or equal 

to $21,549 but less than $64,648: 5 percent 

of the total loan amount; 

D. For a loan amount greater than or equal 

to $13,468 but less than $21,549: $1,077; 

E. For a loan amount less than $13,468: 8 

percent of the total loan amount. 

* * * * * 

Section 1026.52—Limitations on Fees 

* * * * * 

52(b)(1)(ii) Safe harbors 

1. Multiple violations of same type. i. Same 

billing cycle or next six billing cycles. A card 

issuer cannot impose a fee for a violation 

pursuant to § 1026.52(b)(1)(ii)(B) unless a fee 

has previously been imposed for the same 

type of violation pursuant to 

§ 1026.52(b)(1)(ii)(A). Once a fee has been 

imposed for a violation pursuant to 

§ 1026.52(b)(1)(ii)(A), the card issuer may 

impose a fee pursuant to § 1026.52(b)(1)(ii)(B) 

for any subsequent violation of the same type 

until that type of violation has not occurred 

for a period of six consecutive complete 

billing cycles. A fee has been imposed for 

purposes of § 1026.52(b)(1)(ii) even if the 

card issuer waives or rebates all or part of the 

fee. 

A. Late payments. For purposes of 

§ 1026.52(b)(1)(ii), a late payment occurs 

during the billing cycle in which the 

payment may first be treated as late 

consistent with the requirements of this part 

and the terms or other requirements of the 

account. 

B. Returned payments. For purposes of 

§ 1026.52(b)(1)(ii), a returned payment occurs 

during the billing cycle in which the 

payment is returned to the card issuer. 

C. Transactions that exceed the credit 

limit. For purposes of § 1026.52(b)(1)(ii), a 

transaction that exceeds the credit limit for 


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Federal Register / Vol. 83, No. 166 / Monday, August 27, 2018 / Rules and Regulations 43507 

an account occurs during the billing cycle in 

which the transaction occurs or is authorized 

by the card issuer. 

D. Declined access checks. For purposes of 

§ 1026.52(b)(1)(ii), a check that accesses a 

credit card account is declined during the 

billing cycle in which the card issuer 

declines payment on the check. 

ii. Relationship to §§ 1026.52(b)(2)(ii) and 

1026.56(j)(1). If multiple violations are based 

on the same event or transaction such that 

§ 1026.52(b)(2)(ii) prohibits the card issuer 

from imposing more than one fee, the event 

or transaction constitutes a single violation 

for purposes of § 1026.52(b)(1)(ii). 

Furthermore, consistent with 

§ 1026.56(j)(1)(i), no more than one violation 

for exceeding an account’s credit limit can 

occur during a single billing cycle for 

purposes of § 1026.52(b)(1)(ii). However, 

§ 1026.52(b)(2)(ii) does not prohibit a card 

issuer from imposing fees for exceeding the 

credit limit in consecutive billing cycles 

based on the same over-the-limit transaction 

to the extent permitted by § 1026.56(j)(1). In 

these circumstances, the second and third 

over-the-limit fees permitted by 

§ 1026.56(j)(1) may be imposed pursuant to 

§ 1026.52(b)(1)(ii)(B). See comment 

52(b)(2)(ii)–1. 

iii. Examples. The following examples 

illustrate the application of 

§ 1026.52(b)(1)(ii)(A) and (b)(1)(ii)(B) with 

respect to credit card accounts under an 

open-end (not home-secured) consumer 

credit plan that are not charge card accounts. 

For purposes of these examples, assume that 

the billing cycles for the account begin on the 

first day of the month and end on the last day 

of the month and that the payment due date 

for the account is the twenty-fifth day of the 

month. 

A. Violations of same type (late payments). 

A required minimum periodic payment of 

$50 is due on March 25. On March 26, a late 

payment has occurred because no payment 

has been received. Accordingly, consistent 

with § 1026.52(b)(1)(ii)(A), the card issuer 

imposes a $25 late payment fee on March 26. 

In order for the card issuer to impose a $35 

late payment fee pursuant to 

§ 1026.52(b)(1)(ii)(B), a second late payment 

must occur during the April, May, June, July, 

August, or September billing cycles. 

1. The card issuer does not receive any 

payment during the March billing cycle. A 

required minimum periodic payment of $100 

is due on April 25. On April 20, the card 

issuer receives a $50 payment. No further 

payment is received during the April billing 

cycle. Accordingly, consistent with 

§ 1026.52(b)(1)(ii)(B), the card issuer may 

impose a $35 late payment fee on April 26. 

Furthermore, the card issuer may impose a 

$35 late payment fee for any late payment 

that occurs during the May, June, July, 

August, September, or October billing cycles. 

2. Same facts as in paragraph A above. On 

March 30, the card issuer receives a $50 

payment and the required minimum periodic 

payments for the April, May, June, July, 

August, and September billing cycles are 

received on or before the payment due date. 

A required minimum periodic payment of 

$60 is due on October 25. On October 26, a 

late payment has occurred because the 

required minimum periodic payment due on 

October 25 has not been received. However, 

because this late payment did not occur 

during the six billing cycles following the 

March billing cycle, § 1026.52(b)(1)(ii) only 

permits the card issuer to impose a late 

payment fee of $25. 

B. Violations of different types (late 

payment and over the credit limit). The credit 

limit for an account is $1,000. Consistent 

with § 1026.56, the consumer has 

affirmatively consented to the payment of 

transactions that exceed the credit limit. A 

required minimum periodic payment of $30 

is due on August 25. On August 26, a late 

payment has occurred because no payment 

has been received. Accordingly, consistent 

with § 1026.52(b)(1)(ii)(A), the card issuer 

imposes a $25 late payment fee on August 26. 

On August 30, the card issuer receives a $30 

payment. On September 10, a transaction 

causes the account balance to increase to 

$1,150, which exceeds the account’s $1,000 

credit limit. On September 11, a second 

transaction increases the account balance to 

$1,350. On September 23, the card issuer 

receives the $50 required minimum periodic 

payment due on September 25, which 

reduces the account balance to $1,300. On 

September 30, the card issuer imposes a $25 

over-the-limit fee, consistent with 

§ 1026.52(b)(1)(ii)(A). On October 26, a late 

payment has occurred because the $60 

required minimum periodic payment due on 

October 25 has not been received. 

Accordingly, consistent with 

§ 1026.52(b)(1)(ii)(B), the card issuer imposes 

a $35 late payment fee on October 26. 

C. Violations of different types (late 

payment and returned payment). A required 

minimum periodic payment of $50 is due on 

July 25. On July 26, a late payment has 

occurred because no payment has been 

received. Accordingly, consistent with 

§ 1026.52(b)(1)(ii)(A), the card issuer imposes 

a $25 late payment fee on July 26. On July 

30, the card issuer receives a $50 payment. 

A required minimum periodic payment of 

$50 is due on August 25. On August 24, a 

$50 payment is received. On August 27, the 

$50 payment is returned to the card issuer for 

insufficient funds. In these circumstances, 

§ 1026.52(b)(2)(ii) permits the card issuer to 

impose either a late payment fee or a 

returned payment fee but not both because 

the late payment and the returned payment 

result from the same event or transaction. 

Accordingly, for purposes of 

§ 1026.52(b)(1)(ii), the event or transaction 

constitutes a single violation. However, if the 

card issuer imposes a late payment fee, 

§ 1026.52(b)(1)(ii)(B) permits the issuer to 

impose a fee of $35 because the late payment 

occurred during the six billing cycles 

following the July billing cycle. In contrast, 

if the card issuer imposes a returned payment 

fee, the amount of the fee may be no more 

than $25 pursuant to § 1026.52(b)(1)(ii)(A). 

2. Adjustments based on Consumer Price 

Index. For purposes of § 1026.52(b)(1)(ii)(A) 

and (b)(1)(ii)(B), the Bureau shall calculate 

each year price level adjusted amounts using 

the Consumer Price Index in effect on June 

1 of that year. When the cumulative change 

in the adjusted minimum value derived from 

applying the annual Consumer Price level to 

the current amounts in § 1026.52(b)(1)(ii)(A) 

and (b)(1)(ii)(B) has risen by a whole dollar, 

those amounts will be increased by $1.00. 

Similarly, when the cumulative change in the 

adjusted minimum value derived from 

applying the annual Consumer Price level to 

the current amounts in § 1026.52(b)(1)(ii)(A) 

and (b)(1)(ii)(B) has decreased by a whole 

dollar, those amounts will be decreased by 

$1.00. The Bureau will publish adjustments 

to the amounts in § 1026.52(b)(1)(ii)(A) and 

(b)(1)(ii)(B). 

i. Historical thresholds. 

A. Card issuers were permitted to impose 

a fee for violating the terms of an agreement 

if the fee did not exceed $25 under 

§ 1026.52(b)(1)(ii)(A) and $35 under 

§ 1026.52(b)(1)(ii)(B), through December 31, 

2013. 

B. Card issuers were permitted to impose 

a fee for violating the terms of an agreement 

if the fee did not exceed $26 under 

§ 1026.52(b)(1)(ii)(A) and $37 under 

§ 1026.52(b)(1)(ii)(B), through December 31, 

2014. 

C. Card issuers were permitted to impose 

a fee for violating the terms of an agreement 

if the fee did not exceed $27 under 

§ 1026.52(b)(1)(ii)(A) and $38 under 

§ 1026.52(b)(1)(ii)(B), through December 31, 

2015. 

D. Card issuers were permitted to impose 

a fee for violating the terms of an agreement 

if the fee did not exceed $27 under 

§ 1026.52(b)(1)(ii)(A), through December 31, 

2016. Card issuers were permitted to impose 

a fee for violating the terms of an agreement 

if the fee did not exceed $37 under 

§ 1026.52(b)(1)(ii)(B), through June 26, 2016, 

and $38 under § 1026.52(b)(1)(ii)(B) from 

June 27, 2016 through December 31, 2016. 

E. Card issuers were permitted to impose 

a fee for violating the terms of an agreement 

if the fee did not exceed $27 under 

§ 1026.52(b)(1)(ii)(A) and $38 under 

§ 1026.52(b)(1)(ii)(B), through December 31, 

2017. 

F. Card issuers were permitted to impose 

a fee for violating the terms of an agreement 

if the fee did not exceed $27 under 

§ 1026.52(b)(1)(ii)(A) and $38 under 

§ 1026.52(b)(1)(ii)(B), through December 31, 

2018. 

3. Delinquent balance for charge card 

accounts. Section 1026.52(b)(1)(ii)(C) 

provides that, when a charge card issuer that 

requires payment of outstanding balances in 

full at the end of each billing cycle has not 

received the required payment for two or 

more consecutive billing cycles, the card 

issuer may impose a late payment fee that 

does not exceed three percent of the 

delinquent balance. For purposes of 

§ 1026.52(b)(1)(ii)(C), the delinquent balance 

is any previously billed amount that remains 

unpaid at the time the late payment fee is 

imposed pursuant to § 1026.52(b)(1)(ii)(C). 

Consistent with § 1026.52(b)(2)(ii), a charge 

card issuer that imposes a fee pursuant to 

§ 1026.52(b)(1)(ii)(C) with respect to a late 

payment may not impose a fee pursuant to 

§ 1026.52(b)(1)(ii)(B) with respect to the same 

late payment. The following examples 

illustrate the application of 

§ 1026.52(b)(1)(ii)(C): 

i. Assume that a charge card issuer requires 

payment of outstanding balances in full at 


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43508 Federal Register / Vol. 83, No. 166 / Monday, August 27, 2018 / Rules and Regulations 

the end of each billing cycle and that the 

billing cycles for the account begin on the 

first day of the month and end on the last day 

of the month. At the end of the June billing 

cycle, the account has a balance of $1,000. 

On July 5, the card issuer provides a periodic 

statement disclosing the $1,000 balance 

consistent with § 1026.7. During the July 

billing cycle, the account is used for $300 in 

transactions, increasing the balance to 

$1,300. At the end of the July billing cycle, 

no payment has been received and the card 

issuer imposes a $25 late payment fee 

consistent with § 1026.52(b)(1)(ii)(A). On 

August 5, the card issuer provides a periodic 

statement disclosing the $1,325 balance 

consistent with § 1026.7. During the August 

billing cycle, the account is used for $200 in 

transactions, increasing the balance to 

$1,525. At the end of the August billing 

cycle, no payment has been received. 

Consistent with § 1026.52(b)(1)(ii)(C), the 

card issuer may impose a late payment fee of 

$40, which is 3% of the $1,325 balance that 

was due at the end of the August billing 

cycle. Section 1026.52(b)(1)(ii)(C) does not 

permit the card issuer to include the $200 in 

transactions that occurred during the August 

billing cycle. 

ii. Same facts as above except that, on 

August 25, a $100 payment is received. 

Consistent with § 1026.52(b)(1)(ii)(C), the 

card issuer may impose a late payment fee of 

$37, which is 3% of the unpaid portion of 

the $1,325 balance that was due at the end 

of the August billing cycle ($1,225). 

iii. Same facts as in paragraph A above 

except that, on August 25, a $200 payment 

is received. Consistent with 

§ 1026.52(b)(1)(ii)(C), the card issuer may 

impose a late payment fee of $34, which is 

3% of the unpaid portion of the $1,325 

balance that was due at the end of the August 

billing cycle ($1,125). In the alternative, the 

card issuer may impose a late payment fee of 

$35 consistent with § 1026.52(b)(1)(ii)(B). 

However, § 1026.52(b)(2)(ii) prohibits the 

card issuer from imposing both fees. 

* * * * * 

Dated: August 16, 2018. 

Mick Mulvaney, 

Acting Director, Bureau of Consumer 

Financial Protection. 

[FR Doc. 2018–18209 Filed 8–24–18; 8:45 am] 

BILLING CODE 4810–AM–P 

DEPARTMENT OF TRANSPORTATION 

Federal Aviation Administration 

14 CFR Part 73 

[Docket No. FAA–2015–3338; Airspace 

Docket No. 15–ASO–7] 

RIN 2120–AA66 

Modification and Establishment of 

Restricted Areas; Townsend, GA 

AGENCY: Federal Aviation 

Administration (FAA), DOT. 

ACTION: Final rule. 

SUMMARY: This action modifies the 

restricted airspace at the Townsend 

Bombing Range, GA (Range), by 

expanding the lateral limits of R–3007A 

to allow construction of additional 

targets and impact areas. The 

modification is needed so that precision 

guided munitions (PGM) can be used on 

the range. The changes are completely 

contained within the existing outer 

boundaries of the R–3007 complex. 

DATES: Effective date 0901 UTC, 

November 8, 2018. 

FOR FURTHER INFORMATION CONTACT: Paul 

Gallant, Airspace Policy Group, Office 

of Airspace Services, Federal Aviation 

Administration, 800 Independence 

Avenue SW, Washington, DC 20591; 

telephone: (202) 267–8783. 

SUPPLEMENTARY INFORMATION: 

Authority for This Rulemaking 

The FAA’s authority to issue rules 

regarding aviation safety is found in 

Title 49 of the United States Code. 

Subtitle I, Section 106 describes the 

authority of the FAA Administrator. 

Subtitle VII, Aviation Programs, 

describes in more detail the scope of the 

agency’s authority. This rulemaking is 

promulgated under the authority 

described in Subtitle VII, Part A, 

Subpart I, Section 40103. Under that 

section, the FAA is charged with 

prescribing regulations to assign the use 

of the airspace necessary to ensure the 

safety of aircraft and the efficient use of 

airspace. This regulation is within the 

scope of that authority as it modifies 

restricted airspace to accommodate 

military training requirements. 

History 

The FAA published a notice of 

proposed rulemaking for Docket No. 

FAA–2015–3338 in the Federal Register 

(80 FR 60573; October 7, 2015), to 

expand the lateral limits of restricted 

area R–3007A, Townsend, GA. 

Interested parties were invited to 

participate in this rulemaking effort by 

submitting written comments on the 

proposal. The comment period closed 

November 23, 2015. One comment was 

received from a member of the public. 

Discussion of Comment 

The commenter suggested that the 

floor of the proposed R–3007E be 

lowered from 100 feet above ground 

level (AGL); to the surface in order to 

allow the opportunity to add more 

targets in the future. To designate the 

surface as the floor of a restricted area, 

the proponent must own, or otherwise 

control, the underlying land. The 

expansion of R–3007A, which extends 

to the surface, encompasses land 

purchased by the proponent for that 

purpose. R–3007E is outside the land 

purchase area, therefore it is not 

possible to lower the floor below 100 

feet AGL at this time. 

Differences From NPRM 

The NPRM contained an error in the 

15th coordinate listed for R–3007A. The 

longitude for that point was listed as 

‘‘91°36′32′′ W.’’ The correct point is 

‘‘81°36′32′′ W.’’ 

The NPRM listed the ‘‘Air National 

Guard (ANG), Savannah Combat 

Readiness Training Center (CRTC),’’ as 

the using agency in the description of 

R–3007E. Since the publication of the 

NPRM, using agency responsibilities for 

the Range were transferred from the 

ANG to the U.S. Marine Corps (USMC). 

On June 28, 2017, the FAA published in 

the Federal Register a final rule that 

changed the using agency for the 

restricted areas to the USMC, Marine 

Corps Air Station Beaufort, SC (82 FR 

29229), Docket No. FAA–2017–0585. 

The USMC has assumed responsibility 

for management and operation of the 

Townsend Range. This change is 

reflected in the description of R–3007E, 

below. 

The Rule 

The FAA is amending 14 CFR part 73 

to expand restricted area R–3007A by 

merging the part of R–3007C that 

overlies a land parcel acquired by the 

U.S. Marine Corps into R–3007A. The 

floor of R–3007C is 100 feet AGL. By 

adding the airspace over this land parcel 

into R–3007A, the restricted area floor 

in that area will be lowered from 100 

feet AGL down to ground level. The 

small slice of restricted airspace, with a 

100-foot AGL floor, between the east 

boundary of the expanded R–3007A, 

and the west boundary of R–3007B, is 

redesignated as R–3007E. R–3007E 

extends from 100 feet AGL up to, but 

not including, 13,000 feet MSL. 

Minor corrections are made to several 

boundary coordinates for R–3007B, R– 

3007C, and R–3007D to match the 

current National Hydrology Dataset that 

defines the Altamaha River boundary 

where that river forms the boundary of 

the restricted areas. 

This rule provides the additional 

ground-level restricted airspace needed 

for the construction of targets and 

impact areas so that PGM can safely be 

employed at the Range. 

Regulatory Notices and Analyses 

The FAA has determined that this 

regulation only involves an established 

body of technical regulations for which 

frequent and routine amendments are 

necessary to keep them operationally 


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