65628 Federal Register / Vol. 66, No. 245 / Thursday, December 20, 2001 / Rules and Regulations

percent of the Metropolitan Area median

family income or the national Metropolitan

Area median family income, whichever is

greater;

• An area outside of a Metropolitan Area,

where the median family income is at or

below 80 percent of the statewide nonMetropolitan Area median family income or

the national non-Metropolitan Area median

family income, whichever is greater;

• An area where the unemployment rate is

at least 1.5 times the national average;

• An area where the percentage of

occupied distressed housing (as indicated by

lack of complete plumbing and occupancy of

more than one person per room) is at least

20 percent;

• An area located outside of a

Metropolitan Area with a county population

loss between the most recent decennial

census and the previous decennial census of

at least 10 percent;

• An area located outside of a

Metropolitan Area with a county net

migration loss (out-migration minus inmigration) over the five-year period

preceding the most recent decennial census

of at least 5 percent;

• An area meeting the criteria for

economic distress that may be established by

the Community Development Financial

Institutions Fund (CDFI) of the United States

Department of the Treasury.

In addition, the local community,

neighborhood, or rural district must be

underserved, based on data considered by the

NCUA Board and the Federal banking

agencies.

Once an underserved area has been added

to a federal credit union’s field of

membership, the credit union must establish

and maintain an office or facility in the

community within two years. A service

facility is defined as a place where shares are

accepted for members’ accounts, loan

applications are accepted and loans are

disbursed. This definition includes a credit

union owned branch, a shared branch, a

mobile branch, an office operated on a

regularly scheduled weekly basis, or a credit

union owned electronic facility that meets, at

a minimum, these requirements. This

definition does not include an ATM.

If a credit union has a preexisting office

within close proximity to the underserved

area, then it will not be required to maintain

an office or facility within the underserved

area. Close proximity will be determined on

a case-by-case basis, but the office must be

readily accessible to the residents and the

distance from the underserved area will not

be an impediment to a majority of the

residents to transact credit union business.

The federal credit union adding the

underserved community must document that

the community meets the definition for

serving underserved areas in the Federal

Credit Union Act. The charter type of a

federal credit union adding such a

community will not change and therefore the

credit union will not be able to receive the

benefits afforded to low-income designated

credit unions, such as expanded use of non

member deposits and access to the

Community Development Revolving Loan

Program for Credit Unions.

A federal credit union that desires to

include an underserved community in its

field of membership must first develop a

business plan specifying how it will serve the

community. The business plan, at a

minimum, must identify the credit and

depository needs of the community and

detail how the credit union plans to serve

those needs. The credit union will be

expected to regularly review the business

plan, to determine if the community is being

adequately served. The regional director may

require periodic service status reports from a

credit union about the underserved area to

ensure that the needs of the underserved area

are being met as well as requiring such

reports before NCUA allows a federal credit

union to add an additional underserved area.

[FR Doc. 01–31290 Filed 12–19–01; 8:45 am]

BILLING CODE 7535–01–U

NATIONAL CREDIT UNION

ADMINISTRATION

12 CFR Part 701

Organization and Operation of Federal

Credit Unions

AGENCY: National Credit Union

Administration (NCUA).

ACTION: Final rule.

SUMMARY: The NCUA Board is amending

its rule limiting compensation to

officials. The amendment changes the

definition of the term ‘‘compensation’’

to exclude the reimbursement or

payment of business-related travel costs

for an official to be accompanied by a

guest.

EFFECTIVE DATE: This rule is effective

January 22, 2002.

FOR FURTHER INFORMATION CONTACT:

Dianne M. Salva, Staff Attorney,

Division of Operations, Office of

General Counsel, National Credit Union

Administration, 1775 Duke Street,

Alexandria, Virginia 22314–3428, or

telephone (703) 518–6540.

SUPPLEMENTARY INFORMATION:

Background

NCUA published a proposal to amend

its regulation covering travel

reimbursements for guests

accompanying Federal Credit Union

(FCU) officials on business. 66 FR

40641, August 3, 2001. During the sixtyday comment period, NCUA received

thirty-seven comment letters. After

carefully considering the comments,

NCUA is publishing this final rule,

which is identical to the proposal.

The Federal Credit Union Act (the

FCU Act) and NCUA regulations

provide that only one board officer of an

FCU may be compensated as such and

that no other official may receive

compensation for serving as a board or

committee member. 12 U.S.C. 1761(c),

1761a; 12 CFR 701.33. NCUA has

defined compensation to exclude

reasonable and proper expense

reimbursement for costs incurred by

FCU officials in carrying out the

responsibilities of the positions to

which they were appointed or elected.

Section 701.33 currently permits

reimbursement of a board official and

one immediate family member for travel

expenses incurred in performing board

duties if the payment is necessary and

appropriate as determined by the FCU

board and is made in accordance with

written board policies and procedures.

12 CFR 701.33(b)(2)(i).

To give FCUs additional flexibility

regarding the reimbursement of

reasonable and proper expenses, NCUA

has determined to amend

§ 701.33(b)(2)(i) to use the term ‘‘guest’’

rather than ‘‘immediate family

member.’’ All other provisions of the

regulation remain unchanged. Travel

and reimbursement policies must still

provide for payment of only those costs

that are reasonable in relation to the

FCUs resources and financial condition.

NCUA cautions FCUs that this proposal

has no effect on Internal Revenue

Service (IRS) regulations regarding the

reporting and taxing of any payments or

reimbursements. FCUs should consult

their tax advisors or attorneys

concerning IRS requirements related to

their travel reimbursement policies.

Comments

NCUA received thirty-seven comment

letters. Seventeen letters were from

natural person credit unions and two

were from corporate credit unions. Two

were from credit union trade

associations. Eight were from state

credit union leagues and eight were

from credit union officials or other

individuals.

Twenty-seven of the commenters

strongly support the proposal and

applaud the agency efforts to minimize

government intrusion and maximize

flexibility.

Four commenters opposed it, pointing

to possible increases in costs to

members and concerns of its effect on

family unity. The NCUA Board expects

that any increase in costs to members

will be minor and will support the

business of the credit union.

Furthermore, any FCU that adopts a

new policy must still limit its travel

expenditures to amounts that are

reasonable in relation to its resources

and financial condition. Of course, the

amended rule does not require FCUs to

change their current travel expense

reimbursement or payment policies. The

NCUA Board determined to amend the

Federal Register / Vol. 66, No. 245 / Thursday, December 20, 2001 / Rules and Regulations 65629

regulation to allow FCUs greater

flexibility to accommodate the needs of

officials whose duties include businessrelated travel. Under the current

regulation, FCUs may not pay or

reimburse the cost of travel for an

official’s grandson to accompany her to

an FCU-sponsored program, or for an

official whose mobility is impaired to be

accompanied by an aide, even if the

FCU thought it necessary or appropriate.

With this amendment, the FCU will

have the discretion to adopt policies

that provide for the reimbursement or

payment of such travel costs. Again, the

amendment does not require FCUs to do

so.

Five commenters, while generally

supportive, suggested that the proposal

did not go far enough in expanding

credit union authority. These

commenters believe that it is

unnecessary for NCUA to have a

regulation concerning such

reimbursements or payments. They

suggest that NCUA rescind the

regulation so that FCUs can establish

reimbursement policies that fit their

individual needs. They argue that such

policies would be subject to scrutiny in

the examination process and would

therefore pose no risk to safety and

soundness. Two commenters also stated

that NCUA should not have a regulation

on travel reimbursement, but should

rely on the examination process to

ensure that FCUs have reasonable and

appropriate policies. The NCUA Board

believes that it is appropriate for the

agency to maintain a regulation in this

area. There is a tension between the

need of FCUs to attract competent and

dedicated officials and the prohibition

in the FCU Act against compensating all

but one of them. FCUs regularly

question NCUA about the permissibility

of new types of reimbursements. These

new ideas for reimbursements to

officials frequently fall beyond the

limits of the FCU Act. This regulation

provides FCUs with NCUA’s

interpretation of the FCU Act by clearly

stating what types of travel

reimbursements NCUA has found to be

consistent with the law.

Regulatory Procedures

Regulatory Flexibility Act

The Regulatory Flexibility Act

requires NCUA to prepare an analysis to

describe any significant economic

impact a proposed rule may have on a

substantial number of small entities

(primarily those under one million

dollars in assets). This rule will not

have a significant economic impact on

a substantial number of small credit

unions, and therefore, a regulatory

flexibility analysis is not required.

Paperwork Reduction Act

NCUA has determined that this

regulation 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 only to all federal credit unions.

It will not have substantial direct effects

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 the rule does not

constitute a policy that has federalism

implications for purposes of the

executive order.

Small Business Regulatory Enforcement

Fairness Act

The Office of Management and Budget

(OMB) has determined that this is not a

major rule for purposes of the Small

Business Regulatory Enforcement

Fairness Act of 1996.

List of Subjects in 12 CFR Part 701

Credit unions, Reporting and

recordkeeping requirements, Travel and

transportation expenses, Travel

restrictions.

By the National Credit Union

Administration Board on December 13, 2001.

Becky Baker,

Secretary of the Board.

For the reasons set forth in the

preamble, the National Credit Union

Administration amends 12 CFR part 701

as follows:

PART 701—ORGANIZATION AND

OPERATION OF FEDERAL CREDIT

UNIONS

1. The authority citation for part 701

continues to read as follows:

Authority: 12 U.S.C. 1752(5), 1755, 1756,

1757, 1759, 1761a, 1761b, 1766, 1767, 1782,

1784, 1787, and 1789.

Section 701.6 is also authorized by 31

U.S.C. 3717.

Section 701.31 is also authorized by 15

U.S.C. 1601 et seq., 42 U.S.C. 1861 and 42

U.S.C. 3601–3610.

Section 701.35 is also authorized by 42

U.S.C. 4311–4312.

2. Revise the last sentence of

paragraph (b)(2)(i) of § 701.33 to read as

follows:

§ 701.33 Reimbursement, insurance, and

indemnification of officials and employees.

* * * * *

(b) * * *

(2) * * *

(i) * * * Such payments may include

the payment of travel costs for officials

and one guest per official;

* * * * *

[FR Doc. 01–31288 Filed 12–19–01; 8:45 am]

BILLING CODE 7535–01–U

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 39

[Docket No. 2001–SW–51–AD; Amendment

39–12559; AD 2001–25–06]

RIN 2120–AA64

Airworthiness Directives; Sikorsky

Aircraft Corporation Model S–76B and

S–76C Helicopters

AGENCY: Federal Aviation

Administration, DOT.

ACTION: Final rule; request for

comments.

SUMMARY: This amendment adopts a

new airworthiness directive (AD) for

Sikorsky Aircraft Corporation (Sikorsky)

Model S–76B and S–76C helicopters.

This action requires modifying the

electrical power distribution system to

change the source of the 28 volts

supplied to Nos. 1 and 2 attitude and

heading reference (AHRS) WARN

circuits. This amendment is prompted

by a ground test simulating loss of the

essential bus by pulling both bus tie

circuit breakers and switching off both

batteries. As a result of this action, both

autopilots went off-line. The actions

specified in this AD are intended to

prevent an AHRS fail signal to both

autopilots due to a failure of the

essential bus, loss of autopilot

functions, and subsequent loss of

control of the helicopter.

DATES: Effective January 4, 2002.

The incorporation by reference of

certain publications listed in the

regulations is approved by the Director

of the Federal Register as of January 4,

2002.

Comments for inclusion in the Rules

Docket must be received on or before

February 19, 2002.

ADDRESSES: Submit comments in

triplicate to the Federal Aviation