[Federal Register Volume 66, Number 81 (Thursday, April 26, 2001)]
[Rules and Regulations]
[Pages 20901-20902]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-10307]


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NATIONAL CREDIT UNION ADMINISTRATION

12 CFR Part 705


Community Development Revolving Loan Program for Credit Unions

AGENCY: National Credit Union Administration (NCUA).

ACTION: Final rule.

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SUMMARY: The NCUA is revising its regulations pertaining to the 
Community Development Revolving Loan Program For Credit Unions (CDRLP) 
to make more flexible the manner in which NCUA may deliver technical 
assistance to participating credit unions. This revision reflects the 
broad authority granted to NCUA by the Federal Credit Union Act (Act) 
in this context.

DATES: This rule is effective April 26, 2001.

ADDRESSES: National Credit Union Administration, 1775 Duke Street, 
Alexandria, VA 22314-3428.

FOR FURTHER INFORMATION CONTACT: Frank S. Kressman, Staff Attorney, at 
the above address, or telephone: (703) 518-6540.

SUPPLEMENTARY INFORMATION:

A. Background

    The CDRLP is intended to support the community development 
activities of participating credit unions. It does this by making low 
interest loans and providing technical assistance to those credit 
unions. This increases economic and employment opportunities for the 
credit unions' low-income members.
    The Act authorizes the NCUA Board to use interest earned by the 
CDRLP to provide technical assistance to participating credit unions. 
12 U.S.C. 1772c-1. Section 705.10 of NCUA's rules implements this 
authority. 12 CFR 705.10. When this rule was initially adopted, the 
rule's preamble noted, ``NCUA plans to contract with a provider that 
can render necessary technical assistance to credit unions selected for 
participation in the [Community Development Revolving Loan] Program.'' 
52 FR 34891, September 16, 1987. The NCUA Board later amended the rule 
to allow the agency to contract with more than one technical assistance 
provider. 58 FR 21648, April 23, 1993. The NCUA Board further amended 
the rule by eliminating the $120,000 annual limit on technical 
assistance that NCUA could provide in the aggregate to all 
participating credit unions. 61 FR 50694, September 27, 1996. Section 
705.10 then provided: ``Based on available earnings, NCUA may contract 
with outside providers to render technical assistance to participating 
credit unions.''
    In December 2000, shortly after Congress appropriated an additional 
$1 million to the CDRLP, $350,000 of which was specifically earmarked 
for technical assistance, the NCUA further amended Sec. 705.10 by 
interim final rule with request for comments. 65 FR 80298, December 21, 
2000. The NCUA Board recognized that the technical assistance provision 
in Sec. 705.10 was more restrictive than the statutory authority 
granted to it by the Act. The NCUA Board determined that Sec. 705.10 
was unnecessarily restrictive and may interfere with the CDRLP's 
ability to provide technical assistance to participating credit unions 
efficiently. Specifically, the interim final rule gives CDRLP the 
flexibility to provide technical assistance to participating credit 
unions directly or through outside providers selected by the credit 
unions or NCUA.

B. Summary of Comments

    NCUA received comment letters about the interim final rule from 
three credit union trade associations. One commenter expressed its 
general support of the rule. Another asked if NCUA intends to use 
appropriated funds or earnings on the CDRLP fund to reimburse itself 
for technical assistance the NCUA renders directly to credit unions. 
No, NCUA does not intend, nor is it appropriate for it, to use

[[Page 20902]]

appropriated funds or earnings on the CDRLP fund to reimburse itself 
for technical assistance it provides directly to credit unions. Such 
appropriated funds or earnings on the CDRLP fund will only be used to 
pay for technical assistance rendered by outside providers.
    That commenter also questioned NCUA's procedural decision to issue 
the latest amendment to Sec. 705.10 as an interim final rule. As 
discussed in the preamble to the interim final rule, the NCUA Board 
issued an interim final rule because there was a strong public interest 
in having in place rules that made CDRLP technical assistance as 
readily accessible and easily deliverable to participating credit 
unions as possible. Also, the interim final rule imposed no additional 
regulatory burden or expense on participating credit unions. The NCUA 
Board found that, pursuant to 5 U.S.C. 553(b)(3)(B), notice and public 
procedures were impracticable, unnecessary, and contrary to the public 
interest; and, pursuant to 5 U.S.C. 553(d)(3), the rule would be 
effective immediately upon publication. Although the rule was issued as 
an interim final rule, the NCUA Board encouraged interested parties to 
submit comments.

Regulatory Procedures

Regulatory Flexibility Act

    The Regulatory Flexibility Act requires NCUA to prepare an analysis 
to describe any significant economic impact any regulation may have on 
a substantial number of small entities. For purposes of this analysis, 
credit unions under $1 million in assets will be considered small 
entities.
    The NCUA Board has determined and certifies that this rule will not 
have a significant economic impact on a substantial number of small 
entities. The reason for this determination is that this rule provides 
the CDRLP with more options and flexibility in providing technical 
assistance to participating credit unions without any additional 
regulatory burden or expense to credit unions. Accordingly, the NCUA 
has determined that a Regulatory Flexibility Analysis is not required.

Paperwork Reduction Act

    NCUA has determined that this rule does not increase paperwork 
requirements under the Paperwork Reduction Act of 1995 and regulations 
of the Office of Management and Budget.

Executive Order 13132

    Executive Order 13132 encourages independent regulatory agencies to 
consider the impact of their regulatory actions on state and local 
interests. In adherence to fundamental federalism principles, NCUA, an 
independent regulatory agency as defined in 44 U.S.C. 3502(5), 
voluntarily complies with the executive order. This rule will apply to 
some state-chartered credit unions, but will not have substantial 
direct effect on the states, on the relationship between the national 
government and the states, or on the distribution of power and 
responsibilities among the various levels of government. NCUA has 
determined that this rule does not constitute a policy that has 
federalism implications for purposes of the executive order.

Assessment of Federal Regulations and Policies on Families

    NCUA has determined that this final rule will not affect family 
well-being within the meaning of Section 654 of the Treasury and 
General Government Appropriations Act, 1999, Pub. L. 105-277, 112 Stat. 
2681 (1998).

Small Business Regulatory Enforcement Fairness Act

    The Small Business Regulatory Enforcement Fairness Act of 1996 
(Pub. L. 104-121) provides generally for congressional review of agency 
rules. A reporting requirement is triggered in instances where NCUA 
issues a final rule as defined by Section 551 of the Administrative 
Procedure Act. 5 U.S.C. 551. The Office of Management and Budget has 
determined that this final rule is not a major rule for purposes of the 
Small Business Regulatory Enforcement Fairness Act of 1996.

List of Subjects in 12 CFR Part 705

    Community development, Credit unions, Loan programs-housing and 
community development, Reporting and recordkeeping requirements, 
Technical assistance.

    By the National Credit Union Administration Board, on April 19, 
2001.
Becky Baker,
Secretary of the Board.

PART 705--COMMUNITY DEVELOPMENT REVOLVING LOAN PROGRAM FOR CREDIT 
UNIONS

    Accordingly, the interim final rule amending 12 CFR 705.10, which 
was published at 65 FR 80298 on December 21, 2000, is adopted as a 
final rule without change.

[FR Doc. 01-10307 Filed 4-25-01; 8:45 am]
BILLING CODE 7535-01-U