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forms and their instructions. The
proposals are divided into five
categories, wherein the petitioners ask
the Commission to: (1) Eliminate the
need for ‘‘sophisticated accounting
techniques’’ by ‘‘add[ing] a single,
streamlined page to Form 3X for
reporting all in-kind contributions’’ and
‘‘clarify[ing] that committees need only
engage in best efforts to reasonably
ascertain the value of expenditures
subject to 24- and 48-hour reports’’; (2)
revise the forms to ‘‘reflect the existence
of independent-expenditure only
committees’’; (3) revise the forms to
‘‘reflect the existence of Carey funds’’;
(4) revise the forms to ‘‘recognize that
corporations and labor organizations
may make contributions to IE PACs’’;
and (5) revise the forms to ‘‘confine
Form 3X to nonconnected committees
and separate segregated funds, create a
separate reporting form for political
party committees, and thoroughly
redesign Form 3X.’’
The Commission seeks comments on
the petition. The public may inspect the
Petition for Rulemaking on the
Commission’s Web site at http://
www.fec.gov/fosers, or in the
Commission’s Public Records Office,
999 E Street NW., Washington, DC
20463, Monday through Friday, from 9
a.m. to 5 p.m. Interested persons may
also obtain a copy of the petition by
dialing the Commission’s Faxline
service at (202) 501–3413 and following
its instructions. Request document
#277.
The Commission will not consider the
petition’s merits until after the comment
period closes. If the Commission
decides that the petition has merit, it
may begin a rulemaking proceeding.
The Commission will announce any
action that it takes in the Federal
Register.
On behalf of the Commission.
Dated: March 24, 2015.
Ann M. Ravel,
Chair, Federal Election Commission.
[FR Doc. 2015–07176 Filed 3–27–15; 8:45 am]
BILLING CODE 6715–01–P

FEDERAL ELECTION COMMISSION
11 CFR Part 115

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[Notice 2015–06]

Rulemaking Petition: Federal
Contractors
Federal Election Commission.
Rulemaking Petition: Notice of
availability.

AGENCY:
ACTION:

On November 18, 2014, the
Federal Election Commission received a

SUMMARY:

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Petition for Rulemaking from Public
Citizen. The petitioner asks the
Commission to amend its regulations
regarding federal contractors to include
certain factors for determining whether
entities of the same corporate family are
distinct business entities for purposes of
the prohibition on contributions by
federal contractors. The Commission
seeks comments on this petition.
DATES: Comments must be submitted on
or before May 29, 2015.
ADDRESSES: All comments must be in
writing. Commenters are encouraged to
submit comments electronically via the
Commission’s Web site at http://
www.fec.gov/fosers, reference REG
2014–09, or by email to
[email protected].
Alternatively, commenters may submit
comments in paper form, addressed to
the Federal Election Commission, Attn.:
Amy L. Rothstein, Assistant General
Counsel, 999 E Street NW., Washington,
DC 20463.
Each commenter must provide, at a
minimum, his or her first name, last
name, city, state, and zip code. All
properly submitted comments,
including attachments, will become part
of the public record, and the
Commission will make comments
available for public viewing on the
Commission’s Web site and in the
Commission’s Public Records room.
Accordingly, commenters should not
provide in their comments any
information that they do not wish to
make public, such as a home street
address, personal email address, date of
birth, phone number, social security
number, or driver’s license number, or
any information that is restricted from
disclosure, such as trade secrets or
commercial or financial information
that is privileged or confidential.
FOR FURTHER INFORMATION CONTACT: Mrs.
Amy L. Rothstein, Assistant General
Counsel, or Mr. Neven F. Stipanovic,
Attorney, 999 E Street NW.,
Washington, DC 20463, (202) 694–1650
or (800) 424–9530.
SUPPLEMENTARY INFORMATION: On
November 18, 2014, the Commission
received a Petition for Rulemaking from
Public Citizen regarding part 115 of the
Commission’s regulations. Part 115
prohibits federal contractors from
making contributions or expenditures to
any political party, political committee,
or federal candidate, or to any person
for any political purpose or use. 11 CFR
115.2(a); see also 52 U.S.C. 30119(a)(1)
(formerly 2 U.S.C. 441c(a)(1)). Part 115
further prohibits any person from
knowingly soliciting a contribution from
any federal contractor. 11 CFR 115.2(c);
see also 52 U.S.C. 30119(a)(2) (formerly

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16595

2 U.S.C. 441c(a)(2)). The petitioner asks
the Commission to amend 11 CFR part
115 to include certain factors for
determining whether entities of the
same corporate family are distinct
business entities for purposes of these
prohibitions. The Commission seeks
comments on the petition.
The public may inspect the Petition
for Rulemaking on the Commission’s
Web site at http://www.fec.gov/fosers, or
in the Commission’s Public Records
Office, 999 E Street, NW., Washington,
DC 20463, Monday through Friday, from
9 a.m. to 5 p.m. Interested persons may
also obtain a copy of the petition by
dialing the Commission’s Faxline
service at (202) 501–3413 and following
its instructions. Request document
#276.
The Commission will not consider the
petition’s merits until after the comment
period closes. If the Commission
decides that the petition has merit, it
may begin a rulemaking proceeding.
The Commission will announce any
action that it takes in the Federal
Register.
On behalf of the Commission,
Dated: March 24, 2015.
Ann M. Ravel,
Chair, Federal Election Commission.
[FR Doc. 2015–07177 Filed 3–27–15; 8:45 am]
BILLING CODE 6715–01–P

NATIONAL CREDIT UNION
ADMINISTRATION
12 CFR Part 701
RIN 3133–AE39

Federal Credit Union Ownership of
Fixed Assets
National Credit Union
Administration (NCUA).
ACTION: Proposed rule.
AGENCY:

The NCUA Board (Board) is
issuing for public comment this
proposed rule (2015 proposal) to amend
its regulation governing federal credit
union (FCU) ownership of fixed assets.
To provide regulatory relief to FCUs, the
2015 proposal eliminates a provision in
the current fixed assets rule that
established a five percent aggregate limit
on investments in fixed assets for FCUs
with $1,000,000 or more in assets. It
also eliminates the provisions in the
current fixed assets rule relating to
waivers from the aggregate limit.
Further, instead of applying the
prescriptive aggregate limit provided by
regulation in the current fixed assets
rule, the Board proposes to oversee FCU
ownership of fixed assets through the

SUMMARY:

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Federal Register / Vol. 80, No. 60 / Monday, March 30, 2015 / Proposed Rules

supervisory process and guidance. The
2015 proposal also makes conforming
amendments to the scope and
definitions sections of the current fixed
assets rule to reflect this proposed
approach, and it amends the title of
§ 701.36 to more accurately reflect this
amended scope and applicability.
In addition, the 2015 proposal
simplifies the fixed assets rule’s partial
occupancy requirements for FCU
premises acquired for future expansion
by establishing a single six-year time
period for partial occupancy of such
premises and by removing the 30-month
requirement for partial occupancy
waiver requests. The Board notes that,
in July 2014, it issued a proposal
regarding the fixed assets rule that
addressed, among other things, the
partial occupancy provisions of the
fixed assets rule (July 2014 proposal),
but NCUA did not finalize that
proposal. For reasons discussed below,
the 2015 proposal incorporates similar
partial occupancy proposed
amendments from the July 2014
proposal, with one modification to the
time period for partial occupancy.
DATES: Comments must be received on
or before April 29, 2015.
ADDRESSES: You may submit comments
by any of the following methods (Please
send comments by one method only):
• Federal eRulemaking Portal: http://
www.regulations.gov. Follow the
instructions for submitting comments.
• NCUA Web site: http://
www.ncua.gov/
RegulationsOpinionsLaws/proposed_
regs/proposed_regs.html. Follow the
instructions for submitting comments.
• Email: Address to regcomments@
ncua.gov. Include ‘‘[Your name]
Comments on Notice of Proposed
Rulemaking for Part 701, FCU
Ownership of Fixed Assets’’ in the
email subject line.
• Fax: (703) 518–6319. Use the
subject line described above for email.
• Mail: Address to Gerard Poliquin,
Secretary of the Board, National Credit
Union Administration, 1775 Duke
Street, Alexandria, Virginia 22314–
3428.
• Hand Delivery/Courier: Same as
mail address.
Public Inspection: You may view all
public comments on NCUA’s Web site
at http://www.ncua.gov/Legal/Regs/
Pages/PropRegs.aspx as submitted,
except for those we cannot post for
technical reasons. NCUA will not edit or
remove any identifying or contact
information from the public comments
submitted. You may inspect paper
copies of comments in NCUA’s law
library at 1775 Duke Street, Alexandria,

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Virginia 22314, by appointment
weekdays between 9 a.m. and 3 p.m. To
make an appointment, call (703) 518–
6546 or send an email to OGCMail@
ncua.gov.
FOR FURTHER INFORMATION CONTACT:
Pamela Yu, Senior Staff Attorney, Office
of General Counsel, at the above address
or telephone (703) 518–6540, or Jacob
McCall, Program Officer, Office of
Examination and Insurance, at the above
address or telephone (703) 518–6360.
SUPPLEMENTARY INFORMATION:
I. Background
A. 2013 Rule
B. July 2014 Proposal
C. Public Comments on the July 2014
Proposal
II. Summary of the 2015 Proposal
III. Request for Public Comment
IV. Regulatory Procedures

I. Background
The Federal Credit Union Act (FCU
Act) authorizes an FCU to purchase,
hold, and dispose of property necessary
or incidental to its operations.1 NCUA’s
fixed assets rule interprets and
implements this provision of the FCU
Act.2 NCUA’s current fixed assets rule:
(1) Limits FCU investments in fixed
assets; (2) establishes occupancy,
planning, and disposal requirements for
acquired and abandoned premises; and
(3) prohibits certain transactions.3
Under the current rule, fixed assets are
defined as premises, furniture, fixtures,
and equipment, including any office,
branch office, suboffice, service center,
parking lot, facility, real estate where a
credit union transacts or will transact
business, office furnishings, office
machines, computer hardware and
software, automated terminals, and
heating and cooling equipment.4
A. 2013 Rule
The Board has a policy of continually
reviewing NCUA’s regulations to
update, clarify and simplify existing
regulations and eliminate redundant
and unnecessary provisions. To carry
out this policy, NCUA identifies onethird of its existing regulations for
review each year and provides notice of
this review so the public may comment.
In 2012, NCUA reviewed its fixed assets
rule as part of this process. As a result
of that review, in March 2013, the Board
issued proposed amendments to the
fixed assets rule to make it easier for
FCUs to understand it.5 The proposed
amendments did not make any
1 12
2 12

U.S.C. 1757(4).
CFR 701.36.

5 78

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In July 2014, the Board issued a
proposed rule to provide regulatory
relief to FCUs and to allow FCUs greater
autonomy in managing their fixed
assets.7 These amendments reflected
some of the public comments received
on the March 2013 proposal.
Specifically, in the July 2014 proposal,
the Board proposed to allow an FCU to
exceed the five percent aggregate limit,8
without the need for a waiver, provided
that the FCU implemented a fixed asset
management (FAM) program that
demonstrated appropriate preacquisition analysis to ensure the FCU
could afford any impact on earnings and
net worth levels resulting from the
purchase of fixed assets. Under the July
2014 proposal, an FCU’s FAM program
would have been subject to supervisory
scrutiny and would have had to provide
for close ongoing oversight of fixed
assets levels and their effect on the
FCU’s financial performance. It also
would have had to include a written
policy that set an FCU board-established
limit on the aggregate amount of the
FCU’s fixed assets. In the July 2014
proposal, the Board also proposed to
simplify the partial occupancy
requirement for premises acquired for
future expansion by establishing a
single five-year time period for partial
occupancy of any premises acquired for
future expansion, including improved
FR 57250 (Sept. 18, 2013).
FR 46727 (Aug. 11, 2014).
8 The five percent aggregate limit on fixed assets
is measured in comparison to the FCU’s shares and
retained earnings.
7 79

CFR 701.36(c).
FR 17136 (Mar. 20, 2013).

Frm 00007

B. July 2014 Proposal

6 78

3 Id.
4 12

substantive changes to the regulatory
requirements. Rather, they only clarified
the rule and improved its overall
organization, structure, and readability.
In response to the Board’s request for
public comment on the March 2013
proposal, several commenters offered
suggestions for substantive changes to
the fixed assets rule, such as increasing
or eliminating the aggregate limit on
fixed assets, changing the current
waiver process, and extending the time
frames for occupying premises acquired
for future expansion. These comments,
however, were beyond the scope of the
March 2013 proposal, which only
reorganized and clarified the rule.
Accordingly, in September 2013, the
Board adopted the March 2013 proposal
as final without change except for one
minor modification.6 In finalizing that
rule, however, the Board indicated it
would take the commenters’ substantive
suggestions into consideration if it were
to make subsequent amendments to
NCUA’s fixed assets rule.

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and unimproved property, and by
removing the current fixed assets rule’s
30-month time limit for submitting a
partial occupancy waiver request.
C. Public Comments on the July 2014
Proposal
The public comment period for the
July 2014 proposal ended on October
10, 2014. NCUA received thirty-six
comments on the proposal: Two from
credit union trade associations; one
from a bank trade association; sixteen
from state credit union leagues; thirteen
from FCUs; three from federally insured,
state-chartered credit unions; and one
from an individual. While commenters
generally supported the Board’s efforts
to provide regulatory relief from the
requirements concerning FCU fixed
assets, most commenters advocated
more relief or suggested alternative
approaches to achieving that objective.
One commenter fully supported all
aspects of the July 2014 proposal. Two
commenters opposed it, and another
commenter stated that it represented
only a marginal improvement over the
current rule.

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1. Removal of the Waiver Requirement
To Exceed the Five Percent Aggregate
Limit
Under the current rule, if an FCU has
$1,000,000 or more in assets, the
aggregate of all its investments in fixed
assets must not exceed five percent of
its shares and retained earnings, unless
it obtains a waiver from NCUA.9 In the
July 2014 proposal, the Board proposed
to amend this requirement to allow an
FCU to exceed the five percent aggregate
limit, without a waiver, provided the
FCU implemented a FAM program to
manage and monitor the FCU’s fixed
assets.
Fifteen commenters supported
removing the waiver requirement and
also supported the requirement to adopt
a FAM program for those FCUs that
exceed the five percent limit. Five
commenters, however, supported
removing the waiver requirement but
disagreed with the FAM program
requirement. One commenter did not
support the removal of the waiver
requirement.
a. Five Percent Aggregate Limit
In the July 2014 proposal, the Board
did not propose to change the current
rule’s five percent aggregate limit on an
FCU’s investment in fixed assets, but
many commenters nonetheless
advocated its repeal. At least ten
commenters suggested that the July
2014 proposal did not provide sufficient
9 12

CFR 701.36(c).

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regulatory relief and that the five
percent aggregate limit should be
eliminated. These commenters noted
that the aggregate limit is not statutorily
mandated by the FCU Act and, thus,
FCUs should be allowed to
independently manage their own fixed
assets by setting their own credit union
board-approved limits. Four
commenters argued further that FCUs
should be permitted to set their own
fixed assets limits without the
additional requirement of adopting a
burdensome FAM program.
One commenter, however, urged
NCUA not to eliminate the aggregate
limit because allowing unlimited
amounts of investments in fixed assets
could pose a significant safety and
soundness risk. The same commenter
observed that the material loss reviews
of several failed FCUs noted the
contributory role that excessive fixed
assets played in those credit union
failures.
Other commenters were not opposed
to an aggregate limit, but argued it
should be increased. For example, one
commenter advocated a fifteen percent
aggregate limit. Another suggested that
the aggregate limit should be raised to
at least twenty percent.
b. Exclusions From the Fixed Assets
Ratio
A number of commenters
recommended that certain investments
should be excluded from the current
rule’s fixed assets ratio calculation. Two
commenters stated generally that the
fixed assets calculation should reflect
the greater emphasis placed on
technology in the current marketplace
and better account for the need to
replace obsolete technology and
equipment. At least four commenters
stated that investments in information
technology, including computer
hardware and software, should be
excluded from the calculation. One
commenter indicated that fixed assets
should be comprised of land and
buildings only. Another commenter
stated generally that there should be
some type of safe harbor or exclusion to
allow for the purchase of necessary
equipment.
2. Fixed Assets Management Program
Fifteen commenters supported the
proposed requirement for an FCU to
adopt a FAM program before choosing
to exceed the five percent aggregate
limit. However, most commenters that
generally supported this aspect of the
proposal also expressed concerns about
certain aspects of the requirement.
Approximately one quarter of the
commenters opposed the FAM program

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16597

requirement altogether. Of those, several
commenters argued that it is
unnecessary or overly burdensome, and
it would impose additional burdens that
FCUs are not already subject to under
the current rule. For example, four
commenters noted that the requirement
for annual FCU board review is an
additional step that is not present under
the current waiver process. One
commenter argued that the FAM
program requirement would create
unnecessary complications to the
acquisition of fixed assets over the five
percent limit, and the requirement
could serve as a deterrent to the
acquisition of fixed assets. One
commenter argued that the proposal
simply shuffles regulatory burden,
rather than providing meaningful
regulatory relief. Another commenter
also argued that the level of analysis
that must be included in an FCU’s FAM
program is beyond what is required
under the current waiver process and,
thus, the proposal would not reduce
regulatory burden. Three commenters
proffered a similar argument that the
additional requirements imposed after
assets are acquired would increase
FCUs’ compliance responsibilities and
costs, negating any flexibility gained
under the proposal.
a. Minor Acquisitions
Four commenters requested changes
to proposed § 701.36(c)(2), which would
require an FCU to seek FCU board
approval to make investments in fixed
assets exceeding the aggregate limit
‘‘except for the minor acquisitions of
equipment in the normal course of
business.’’ A number of commenters
suggested this language should be
expanded to include minor acquisitions
of furniture and fixtures, in addition to
equipment. One commenter suggested
‘‘minor acquisitions’’ should
specifically include purchases of
desktop technologies, such as computer
monitors, printers, faxes, scanners,
copiers, and telephones, upgrades or
renewals to existing desktop software,
and ATMs. Another commenter
suggested that ‘‘minor acquisitions’’
should be defined as anything under
.005 percent of shares and retained
earnings.
b. Future Marketability
At least seven commenters expressed
concern with the ‘‘future marketability’’
element of the FAM program.
Specifically, proposed § 701.36(2)(iii)
provided that FCU board oversight of an
investment in real property that would
cause the FCU to exceed the five percent
aggregate limit must reflect the board’s
consideration of the ‘‘future

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marketability’’ of the premises.
Commenters noted that this requirement
could, in some circumstances, be
contrary to the best interest of members,
particularly low-income members and
members in rural or underserved areas.
They argued that the decision to
purchase a branch or office location
should be based on member service
needs, not future marketability. At least
four commenters requested that the
future marketability provision be
eliminated because strategic
considerations beyond marketability
factor into a decision to acquire fixed
assets.

limit on fixed assets, as discussed in
further detail below.

c. Internal Controls
Proposed § 701.36(c)(3) would have
required an FCU’s FAM program to
establish ongoing internal controls to
monitor and measure the FCU’s
investments in fixed assets. Two
commenters disagreed with the
proposed internal controls requirement,
noting that the current fixed assets rule
does not have a specific internal
controls requirement. These
commenters argued that internal
controls to monitor fixed assets
investments should not be prescribed by
specific regulatory requirements, but
rather such internal controls should be
determined by credit union
management and subject to examiner
review during the routine examination
process.

1. Time Period for Partial Occupancy
Under the current rule, if an FCU
acquires premises for future expansion
and does not fully occupy them within
one year, it must have an FCU board
resolution in place by the end of that
year with definitive plans for full
occupation. In addition, the rule
requires an FCU to partially occupy the
premises within a reasonable period,
but no later than three years after the
date of acquisition, or six years if the
premises are unimproved land or
unimproved real property. In the July
2014 proposal, the Board proposed to
simplify this aspect of the fixed assets
rule by establishing a single time period
of five years from the date of acquisition
for partial occupancy of any premises
acquired for future expansion,
regardless of whether the premises are
improved or unimproved.
Three commenters agreed with the
proposal to establish a single, uniform
five-year time period for partial
occupancy of any premises acquired for
future expansion. Of those, one
commenter stated that an increase of
two years for partial occupancy of
improved property is a beneficial tradeoff for the one year reduction in the
timeframe for partial occupancy of
unimproved property. The same
commenter noted that a single
timeframe is easier for compliance
purposes.
Two commenters supported a uniform
time period, but suggested that five
years is insufficient. They
recommended that, at a minimum, it
should be a uniform six years, as
previously provided for unimproved
property. Seven commenters suggested
that the time period for partial
occupancy should be extended to ten
years.
Eight commenters agreed with
extending the partial occupancy
requirement for improved premises
from three to five years, but disagreed
with reducing the partial occupancy
requirement for unimproved property

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d. Appeals
Eight commenters suggested that any
final rule should include an appeals
process to allow, for example, an FCU
to appeal if an examiner contests an
FCU’s fixed asset investment or
disapproves an FCU’s FAM program.
e. Conclusion Regarding Aggregate
Limit and FAM Program
After careful consideration of the
public comments relating to the fixed
assets aggregate limit, the Board has
determined that additional regulatory
relief beyond what was provided in the
July 2014 proposal is warranted.
Therefore, the Board is not adopting the
July 2014 proposed amendments
relating to the five percent aggregate
limit on fixed assets, including any
FAM program requirements. In
particular, upon further review, the
Board has concluded that oversight of
the purchase of FCU investments in
fixed assets can be effectively achieved
through supervisory guidance and the
examination process, rather than
through prescriptive regulatory
limitations. Accordingly, the Board is
issuing this 2015 proposal to remove
altogether the five percent aggregate

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D. Partial Occupancy
The July 2014 proposal also would
have simplified the partial occupancy
requirement for premises acquired for
future expansion. Virtually all
commenters that provided feedback on
the proposed amendments to the partial
occupancy requirement supported the
overall concept of streamlining or
improving this aspect of the fixed assets
rule. However, as discussed more fully
below, most commenters requested
additional relief beyond that proposed.

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from six to five years. Of those, two
commenters posited that reducing the
timeframe would increase an FCU’s
regulatory burden.
One commenter suggested that the
current partial occupancy requirements
should be retained, but the rule should
require an FCU (or a combination of an
FCU, credit union service organization,
and/or credit union vendor) to occupy
at least 51 percent of the premises to
meet the partial occupancy requirement.
This commenter argued that relaxing the
partial occupancy requirement would
encourage FCUs to maximize nonmission related income by leasing out
their property. The same commenter
further stated that because FCUs are not
subject to unrelated business income
taxes, they have an incentive to
maximize leasing income by delaying
occupancy, and this would be an abuse
of the credit union tax exempt status.
Another commenter also supported
retaining separate timeframes for
improved and unimproved property, but
suggested that both time periods should
be lengthened to five years and eight
years, respectively.
Approximately thirteen commenters
suggested that regulatory timeframes for
occupancy should be eliminated
entirely. These commenters generally
argued that an FCU should have the
ability to make its own determination,
in its FAM program or by board policy,
about how much time it needs to reach
full or partial occupancy of its property.
The Board has carefully weighed
these comments, but disagrees with
commenters who suggested that
regulatory timeframes for occupancy
should be eliminated.
Unlike the five percent aggregate
limit, which is a safety and soundness
safeguard but is not statutorily required,
the occupancy requirements in the fixed
assets rule have statutory
underpinnings. As discussed in the
preamble to the July 2014 proposal, an
FCU may not hold (or lease to unrelated
third parties) real property indefinitely
without fully occupying the premises.
Section 107(4) of the FCU Act
authorizes an FCU to purchase, hold,
and dispose of property necessary or
incidental to its operations.10 NCUA has
long held that this provision means an
FCU may only invest in property it
intends to use to transact credit union
business or in property that supports its
internal operations or member
services.11 There is no authority in the
10 12

U.S.C. 1757(4) (emphasis added).
43 FR 58176, 58178 (Dec. 13, 1978) (‘‘Part
107(4) of the Federal Credit Union Act provides that
a credit union may purchase, hold, and dispose of
property necessary or incidental to its operations.
11 See

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FCU Act for an FCU to invest in real
estate for speculative purposes or to
otherwise engage in real estate activities
that do not support its purpose of
providing financial services to its
members. While there is no required
timeframe in the fixed assets rule within
which an FCU must achieve full
occupation, the rule requires an FCU to
partially occupy the premises within a
time period set by the rule and
sufficient to show, among other things,
that the FCU will fully occupy the
premises within a reasonable time.12
The Board emphasizes that FCUs
already have significant leeway and
flexibility in managing real property
acquired for future use, given that there
is no required time period for full
occupation. Moreover, the proposed
elimination of the 30-month
requirement for partial occupancy
waiver requests, which is discussed
below, would allow FCUs additional
leeway to apply for a waiver later if it
deemed appropriate.
The Board continues to believe that,
as discussed in the preamble to the July
2014 proposal, a single time period for
partial occupancy would simplify and
improve the rule.13 However, in light of
commenters’ concerns that shortening
the time period for unimproved
property from six to five years would
increase regulatory burden, the Board
has decided to maintain the current
time allowed for partial occupancy of
unimproved property. Accordingly, the
Board is proposing a single six-year time
period for partial occupancy in this
2015 proposal. The proposed
amendment therefore retains the current
time period for unimproved land or
unimproved real property, and extends
the current time period for improved
premises by three years, which the
Board believes is a significant measure
of relief for FCUs.

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2. Waivers
Under the current rule, an FCU must
submit its request for a waiver from the
partial occupancy requirement within
Retaining a piece of property whose only purpose
is to provide office space to other entities is clearly
not necessary or incidental to the Federal credit
union’s operations. Further, investing in, or
holding, property with the intent of realizing a
profit from appreciation at a future sale is also
outside the powers of a Federal credit union.’’); 69
FR 58039, 58041 (Sept. 29, 2004) (‘‘Federal credit
unions are chartered for the purpose of providing
financial services to their members and it is not
permissible for them to engage in real estate
activities that do not support that purpose.’’)
12 12 CFR 701.36(b).
13 The Board notes that a single time period
would be consistent with the Office of the
Comptroller of the Currency’s (OCC) uniform fiveyear requirement for real estate acquired by banks
for future expansion.

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30 months after the property is
acquired. In the July 2014 proposal, the
Board proposed to eliminate the 30month requirement and allow FCUs to
apply for a waiver beyond that time
frame as appropriate. Seven commenters
provided feedback on this aspect of the
proposal, and all supported it. In light
of the unanimous support from
commenters on this aspect of the July
2014 proposal, the Board is restating in
this 2015 proposal, without change, the
proposed waiver provision originally
proposed in the July 2014 proposal.
Although the Board is incorporating the
same proposed amendments to the
partial occupancy waiver requirements,
the Board still invites comments on this
subject to help inform its decision for
the final rule. The Board notes that it is
unnecessary for commenters to the July
2014 proposal to resubmit their same
comments again. NCUA has considered
those previously submitted comments
and will consider them again before
finalizing this rule. However,
commenters with new, different, or
updated comments should feel free to
submit them as provided for above.
3. Definition
Although the Board did not propose
amending any current definitions in the
fixed assets rule, five commenters
expressed concern about the definition
of ‘‘partial occupancy,’’ as clarified by
the March 2013 proposal. Of those, four
commenters suggested that the
clarification reduced an FCU’s ability to
meet partial occupancy requirements,
particularly with respect to ATMs
deployed on vacant land purchased for
future expansion. The commenters
asked that any subsequent final rule
correct this. One commenter stated
generally that any subsequent final rule
should reinstate the previous definition.
The Board reiterates that, as indicated
in the preambles to the March 2013
proposal and the corresponding final
rule,14 the clarification of the partial
occupancy definition did not impose
any new regulatory requirements on
FCUs or amend the meaning of that
term. Rather, it only clarified the partial
occupancy provisions by reflecting
NCUA’s interpretation of them.
Accordingly, the Board is not proposing
any amendments in this 2015 proposal
as a result of those comments.
E. Full Occupancy
The current rule does not set a
specific time period within which an
FCU must achieve full occupation of
premises acquired for future expansion.
14 78 FR 17136 (Mar. 20, 2013); 78 FR 57250
(Sept. 18, 2013).

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However, partial occupancy of the
premises is required within a set
timeframe and must be sufficient to
show, among other things, that the FCU
will fully occupy the premises within a
reasonable time and consistent with its
plan for the premises.15 The Board did
not propose to amend the full
occupancy requirement in the July 2014
proposal, but it requested public
comment on this topic.
At least four commenters said the
current rule should be retained, and
NCUA should not set a specific time
period for full occupancy. Of those,
three commenters said FCUs should
have flexibility under the rule. Three
commenters noted that FCU boards and
management should determine the best
timeframe in which to fully develop
property. One commenter said there is
no need to modify the full occupancy
requirement, but NCUA should consider
improving the definition of full
occupancy.
One commenter stated generally that
the full occupancy requirement should
be modified and determined on a caseby-case basis. Another commenter
suggested that if the requirement is
modified, at a minimum, the timeframe
for full occupancy should be six years
for all property, along with a simple
extension process. Two commenters
suggested that the full occupancy
requirement should be eliminated
entirely. Three commenters suggested
that NCUA should replace the ‘‘full’’
occupancy requirement with a
‘‘significant’’ or ‘‘substantial’’
occupancy requirement. Of these, one
commenter said ‘‘substantial
occupancy’’ should be defined as fiftyone percent occupancy. Another
commenter suggested ‘‘substantial
occupancy’’ should be defined as
‘‘within a reasonable period of time
consistent with FCU’s usage plan.’’
One commenter, however, argued that
the full occupancy requirement should
be stricter. This commenter suggested
that NCUA should require full
occupancy within three years of
reaching partial occupancy, to ensure
that FCUs are not participating in
impermissible real estate activities.
Citing OCC guidance, the commenter
indicated that, historically, three years
15 Under the current rule, if an FCU acquires
premises for future expansion and does not fully
occupy them within one year, it must have an FCU
board resolution in place by the end of that year
with definitive plans for full occupation. 12 CFR
701.36(d)(1). The reasonableness of an FCU’s plan
for full occupation is evaluated through the
examination process and based upon such factors
as the defensibility of projection assumptions, the
operational and financial feasibility of the plan, and
the overall suitability of the plan relative to the
FCU’s field of membership.

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has been a reasonable time for national
banks to reach full occupancy.
The Board appreciates these
comments and, after careful
consideration of the points raised, it has
determined to retain the current full
occupancy provision. Accordingly, the
Board is not proposing to amend the full
occupancy requirement in this 2015
proposal. As discussed above, the
limited authority in Section 107(4) the
FCU Act means that an FCU may not
hold real property indefinitely without
fully occupying the premises. There is
no authority for an FCU to invest
speculatively in real estate or to
otherwise engage in real estate activities
that do not support its purpose of
providing members with financial
services. The Board reiterates there is no
required time period within which an
FCU must achieve full occupation.
However, the limited authority for FCUs
to invest in property granted by the FCU
Act mandates that full occupancy must
be achieved. The Board believes the
current rule gives FCUs substantial
flexibility in managing fixed assets
acquired for future use within the
authority granted in the FCU Act, and
thus, no changes are proposed.

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F. Leasing
At least five commenters
recommended that the fixed assets rule
be amended to allow an FCU to generate
income from premises. Of those, three
commenters urged NCUA to consider a
‘‘de minimis ownership exception’’
under which land that is not valued at
more than three percent of shares and
retained earnings would not be subject
to the occupancy requirements. One
commenter suggested that more
flexibility is needed for an FCU to retain
undeveloped property on a long-term
basis and encouraged NCUA to allow
2.5 percent to 5 percent of an FCU’s net
worth to be invested in undeveloped or
vacant properties. Another commenter
argued that excess space should not sit
idle if it could be used to generate value
for the membership, even if such space
is not specifically used for member
business.
At least seven commenters argued
that the requirement for full occupancy
should allow for an FCU to lease or
sublease a portion of its premises as
needed. Two of these commenters
argued that restrictive occupancy
requirements reduce access to
commercial space and limit an FCU’s
ability to acquire space in the most costeffective manner. Four commenters
cited a number of reasons why an FCU
might want to lease its property,
including zoning or retail requirements,

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city entitlement, or other use
requirements.
Four commenters discussed credit
union mergers. They suggested that, in
a merger, space may be available in an
existing building if operations are
combined. The ability to lease or
sublease this excess space could permit
an FCU to realize short-term income
from the lease while retaining property
that fits into the FCU’s long-term plans
for member service. Four commenters
suggested that an FCU should be
allowed to maximize long-term assets,
instead of avoiding reasonable
acquisitions or underutilizing space to
ensure compliance with occupancy
requirements.
As discussed above, NCUA’s longstanding interpretation is that the
limited statutory authority for FCUs to
invest in property mandates that full
occupancy must be achieved, and there
is no authority for an FCU to engage in
real estate activities that do not support
its purpose of providing financial
services to its members. The Board has
also long recognized, however, that in
planning for future expansion, FCUs
should be able to sell or lease their
excess capacity as a matter of good
business practice.16 Indeed, the
incidental powers rule permits the sale
or lease of excess capacity in FCU fixed
assets.17 Excess capacity is the excess
use or capacity remaining in facilities,
equipment, or services that an FCU
properly invested in with the good faith
intent to serve its members, and where
the FCU reasonably anticipates that the
excess capacity will be taken up by the
future expansion of services to its
members.18 An FCU’s sale or lease of
excess capacity may, for example,
involve leasing excess office space,
sharing employees, or using data
processing systems to process
information for third parties.19
However, in adopting the excess
capacity provision in the incidental
powers rule, the Board noted in 2001
that:
NCUA has consistently held the position
that an FCU has limited authority in the
16 66

FR 40845, 40851 (Aug. 6, 2001).
incidental powers rule defines an
incidental powers activity as one that is necessary
or requisite to enable an FCU to carry on effectively
the business for which it is incorporated. An
activity meets the definition of an incidental
powers activity if it: (1) Is convenient or useful in
carrying out the mission or business of credit
unions consistent with the FCU Act; (2) is the
functional equivalent or logical outgrowth of
activities that are part of the mission or business of
credit unions; and (3) involves risks similar in
nature to those already assumed as part of the
business of credit unions. 12 CFR 721.2.
18 12 CFR 721.3(e).
19 Id.
17 The

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leasing of fixed assets and the sale of excess
data processing capacity. FCUs are not in the
business of providing others with data
processing capacity or any other service that
is not within their express or incidental
powers; rather, they are cooperative financial
institutions organized to provide financial
services to their members.20

Accordingly, the Board emphasizes
that an FCU already has the authority
under the incidental powers rule to
obtain short-term income by leasing
excess capacity in its fixed assets to
third parties. However, there are limits
to that authority. The fixed assets must
have been acquired by an FCU, in good
faith, for the purpose of providing
financial services to its members, and
the FCU must reasonably anticipate, and
plan,21 that the excess capacity will be
fully occupied by the FCU in the future.
II. Summary of the 2015 Proposal
As discussed above, because of the
public comments received in response
to the July 2014 proposal, the Board is
issuing this 2015 proposal to address
commenters’ requests for additional
regulatory relief from the aggregate limit
on fixed assets. The Board is also
incorporating similar partial occupancy
requirements from the July 2014
proposal, with one modification to the
proposed single time period for partial
occupancy, to provide additional relief
to FCUs.
A. Aggregate Limit On Investments in
Fixed Assets
Section 701.36(c) of the current fixed
assets rule establishes an aggregate limit
on investments in fixed assets for FCUs
with $1,000,000 or more in assets.22 For
an FCU meeting this asset threshold, the
aggregate of all its investments in fixed
assets is limited to five percent of its
shares and retained earnings, unless
NCUA grants a waiver establishing a
higher limit.23 The aggregate limit is not
statutorily required by the FCU Act.
Rather, it was established by regulation
in 1978 as a safety and soundness
measure to prevent losses or impaired
operations of FCUs from overinvestment
in non-income producing fixed assets.24
In the past few years, and most
recently in response to the July 2014
proposal, FCUs have asked the Board to
consider increasing or eliminating the
aggregate limit.25 In addition to the
20 66

FR 40845, 40851 (Aug. 6, 2001).
12 CFR 701.36(d)(1).
22 As of September 30, 2014, 226 of the total 3,707
FCUs with assets over $1,000,000 are currently
above the five percent aggregate limit.
23 12 CFR 701.36(c).
24 43 FR 58176 (Dec. 13, 1978).
25 See, e.g., 75 FR 66295, 66297 (Oct. 28, 2010);
78 FR 57250, 57250 (Sept. 18, 2013); 79 FR 46727
(Aug. 11, 2014).
21 See

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comments discussed above, FCUs have
repeatedly mentioned that the five
percent limit is too low for FCUs to
effectively manage their investments in
fixed assets and to achieve growth. They
have argued that the current limit does
not allow FCUs adequate flexibility in
acquiring fixed assets to serve their
members’ needs.
As discussed in the preamble to the
July 2014 proposal, the objective of the
fixed assets rule is to place reasonable
limits on the risk associated with
excessive or speculative acquisition of
fixed assets.26 Upon further review and
consideration, the Board believes this
objective can be effectively achieved
through the supervisory process as
opposed to a regulatory limit.
Accordingly, the Board proposes to
eliminate the five percent aggregate
limit on FCU investments in fixed
assets. It also proposes to eliminate the
related provisions governing waivers of
the aggregate limit because those
provisions will no longer be necessary
in the absence of a prescriptive
regulatory limit.
An FCU’s ability to afford a given
level of fixed assets depends on a
variety of factors, including its level of
net worth and earnings, its operational
efficiency, and risks to its future
earnings and growth inherent in the
FCU’s balance sheet and strategic plans.
Excessive levels of fixed assets can
create earnings and capital
accumulation problems for an FCU, and
lead to greater losses to the National
Credit Union Share Insurance Fund
(NCUSIF), if the FCU fails and its fixed
assets cannot be sold at or above their
recorded value. Fixed assets not only
hold member funds in non-income
producing assets, but they also typically
involve a material increase in FCU
operating expenses, such as
depreciation, maintenance, and other
related expenses. According to NCUA
data, excessive levels of fixed assets
have contributed to the failure of some
credit unions. Of the 63 FCU failures 27
26 See 43 FR 26317 (June 19, 1978) (‘‘This
regulation is intended to ensure that the officials of
FCUs have considered all relevant factors prior to
committing large sums of members’ funds to the
acquisition of fixed assets.’’); 49 FR 50365, 50366
(Dec. 28, 1984) (‘‘The intent of the regulation is to
prevent, or at least curb, excessive investments in
fixed assets and the related costs and expenses that
may be beyond the financial capability of the credit
union.’’); 54 FR 18466, 18467 (May 1, 1989) (‘‘[T]he
purpose of the regulation is to provide some control
on the potential risk of excess investment and/or
commitment to invest substantial sums in fixed
assets.’’).
27 This figure includes all FCUs over $1,000,000
in assets. FCUs under that asset threshold and
federally insured, state-chartered credit unions are
not subject to the aggregate limit and therefore
excluded from this figure.

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that resulted in a loss to the NCUSIF
since 2009, excessive levels of fixed
assets contributed in part to the failures
in 10 of those cases (16 percent), and
were a primary contributor in 3 cases (5
percent). However, overall, excessive
fixed asset levels have not been a
disproportionate contributor to FCU
failures. In many cases, FCUs have
effectively managed elevated levels of
fixed assets to safely achieve member
service and growth objectives. For the
264 FCUs with fixed assets ratios
exceeding five percent as of December
2004, 197 (74.62 percent) were still
active as of December 2013. In
comparison, the total number of credit
unions from December 2004 to 2013
went from 9,128 to 6,554, representing
a 71.8 percent survival rate. Thus, the
level of consolidation in FCUs with
elevated fixed assets levels has been no
higher than for FCUs with lower levels.
Also, CAMEL rating and net worth ratio
distributions were not significantly
different for FCUs with elevated fixed
assets levels than for those without.
Further, over the last 10 years, NCUA
has granted approximately 500 waivers
to FCUs to operate at levels of fixed
assets above the five percent aggregate
limit, including some above 20 percent
of total assets.28
In addition, the experience with FCUs
operating with higher fixed assets ratios
under NCUA’s former Regulatory
Flexibility Program (RegFlex) 29
indicates that the risks associated with
investment in fixed assets are
manageable through supervision. Out of
the 149 former RegFlex FCUs with fixed
assets over the five percent aggregate
limit, 120 FCUs (80 percent) were still
operating nearly a decade later.30 By
comparison, as noted above, the overall
survival rate for all credit unions during
the same time period was 71.8 percent.
Further, 25 of those 120 FCUs (20
percent) have continued to operate
effectively above the five percent
aggregate limit, indicating that some
FCUs can safely maintain elevated
levels of fixed assets over time.
Therefore, upon further analysis, the
Board has determined that oversight of
28 Since 2004, approximately 94 percent of
waivers were for levels of fixed assets less than 10
percent of total assets.
29 The RegFlex Program was established in 2002,
66 FR 58656 (Nov. 23, 2001), and eliminated in
2012, 77 FR 31981 (May 31, 2012). RegFlex relieved
FCUs from certain regulatory restrictions and
granted them additional powers if they
demonstrated sustained superior performance as
measured by CAMEL ratings and net worth
classification. One of the flexibilities enjoyed by
RegFlex FCUs at one time was relief from the
aggregate limit on fixed assets.
30 As of December 31, 2013, in 95 of those 120
FCU (80 percent), fixed assets levels had declined
to under 5 percent.

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FCU investments in fixed assets would
be effectively achieved through the
supervisory process, and evaluated on a
case-by-case basis. The Board
emphasizes, however, that NCUA’s
supervisory expectations remain high.
The Board cautions that the proposed
elimination of the aggregate limit should
not be interpreted as an invitation for
FCUs to make excessive, speculative, or
otherwise irresponsible investments in
fixed assets. Rather, the 2015 proposal
reflects the Board’s recognition that
relief from the prescriptive limit on
fixed assets is appropriate, but FCU
investments in fixed assets are, and will
continue to be, subject to supervisory
review. If an FCU has an elevated level
of fixed assets, NCUA will maintain
close oversight to ensure it conducts
prudent planning and analysis with
respect to fixed assets acquisitions, can
afford any such acquisitions, and
properly manages any ongoing risk to its
earnings and capital.
If the Board finalizes this 2015
proposal, NCUA will issue updated
supervisory guidance to examiners that
will be shared with FCUs. The guidance
will reflect current supervisory
expectations 31 that require an FCU to
demonstrate appropriate due diligence,
ongoing board and management
oversight,32 and prudent financial
analysis to ensure the FCU can afford
any impact on earnings and net worth
levels caused by its purchase of fixed
assets. The guidance will ensure
examiners effectively identify any risks
to safety and soundness due to an FCU’s
excessive investment in fixed assets. It
will focus on evaluating the quality of
an FCU’s fixed assets management
relative to its planning for fixed assets
acquisitions and controlling the related
financial risks. The guidance will also
focus on evaluating an FCU’s quality of
earnings and capital relative to its
projected performance under both
baseline (expected) and stressed
scenarios.
B. Partial Occupancy
For the reasons discussed above, the
Board is incorporating, with one change,
the proposed amendments in the July
2014 proposal relating to the partial
occupancy requirements for FCU
premises acquired for future expansion.
Specifically, the Board is proposing to
require an FCU to partially occupy any
premises acquired for future expansion,
31 See

NCUA Examiner’s Guide, Chapter 8.
credit union’s board needs to approve
plans for any investment in fixed assets that will
materially affect the credit union’s earnings. Credit
union management should only purchase fixed
assets in compliance with policy approved by the
credit union’s board.
32 The

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regardless of whether the premises are
improved or unimproved property,
within six years from the date of the
FCU’s acquisition of those premises. In
the July 2014 proposal, the Board had
proposed to require partial occupancy
within a uniform five years. However, as
discussed above, in response to public
comments, this 2015 proposal provides
six years rather than five years for
partial occupancy, which retains the
current time period for unimproved
land or unimproved real property and
extends the current time period for
improved premises by three years. In
addition, the Board is reissuing in this
2015 proposal, without change, the
amendment in the July 2014 proposal to
eliminate the requirement that an FCU
that wishes to apply for a waiver of the
partial occupancy requirement must do
so within 30 months of acquisition of
the property acquired for future
expansion.

moot as of the effective date of the final
rule.

C. Conforming Amendments
The Board is also proposing to make
conforming amendments to the fixed
assets rule’s scope and definitions
sections. Specifically, the Board
proposes to amend § 701.36(a) of the
current fixed assets rule to remove
reference to the aggregate limit on FCU
investments in fixed assets. This
language is unnecessary with the
proposed removal of the aggregate limit.
This 2015 proposal also amends
§ 701.36(b) of the current fixed assets
rule to remove the regulatory definitions
of the following terms: ‘‘fixed assets,’’
‘‘furniture, fixtures, and equipment,’’
‘‘investments in fixed assets,’’ ‘‘retained
earnings,’’ and ‘‘shares.’’ These
definitions are included in the current
rule to provide meaning to certain terms
used in the regulatory provision
establishing the aggregate limit on fixed
assets. With the proposed removal of the
aggregate limit, however, inclusion of
these regulatory definitions is no longer
necessary.

A. Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA)
generally requires that, in connection
with a notice of proposed rulemaking,
an agency prepare and make available
for public comment an initial regulatory
flexibility analysis that describes the
impact of a proposed rule on small
entities. A regulatory flexibility analysis
is not required, however, if the agency
certifies that the rule will not have a
significant economic impact on a
substantial number of small entities
(defined for purposes of the RFA to
include credit unions with assets less
than $50 million) and publishes its
certification and a short, explanatory
statement in the Federal Register
together with the rule. The 2015
proposal would provide regulatory relief
to help FCUs better manage their
investments in fixed assets. NCUA
certifies that the 2015 proposal will not
have a significant economic impact on
a substantial number of small credit
unions.

D. Amended Title
Finally, the Board proposes to amend
the title of the regulation to more
accurately reflect its amended scope and
applicability. Currently, the rule is titled
‘‘Federal credit union ownership of
fixed assets.’’ If the 2015 proposal is
finalized, the rule will be retitled
‘‘Federal credit union occupancy,
planning, and disposal of acquired and
abandoned premises.’’

B. Paperwork Reduction Act
The Paperwork Reduction Act of 1995
(PRA) applies to rulemakings in which
an agency by rule creates a new
paperwork burden on regulated entities
or modifies an existing burden.33 For
purposes of the PRA, a paperwork
burden may take the form of either a
reporting or a recordkeeping
requirement, both referred to as
information collections. The 2015
proposal provides regulatory relief to
FCUs by eliminating the requirement
that, for an FCU with $1,000,000 or
more in assets, the aggregate of all its

E. Effect on Existing Waivers
Should the 2015 proposal become
finalized as proposed, any existing
waiver of the five percent aggregate
limit on fixed assets will be rendered

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III. Request for Public Comment
Because the proposed amendments
are intended to grant regulatory relief to
FCUs, and the Board perceives no
reason to delay their implementation,
the Board is issuing the 2015 proposal
for a 30-day public comment period
instead of NCUA’s customary 60 days.
Additionally, the Board already
solicited comments on this subject in
the July 2014 proposal. The Board
invites comment on all issues discussed
in this 2015 proposal; however, as noted
earlier, it is not necessary for
commenters to resubmit any comments
they previously submitted in response
to the July 2014 proposal. NCUA has
already reviewed those comments and
will consider them again before
finalizing this rule.
IV. Regulatory Procedures

33 44

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investments in fixed assets must not
exceed five percent of its shares and
retained earnings, unless it obtains a
waiver from NCUA. The 2015 proposal
does not impose new paperwork
burdens. However, the 2015 proposal
would relieve FCUs from the current
requirement to obtain a waiver to
exceed the five percent aggregate limit
on investments in fixed assets.
According to NCUA records, as of
September 30, 2014, there were 3,707
FCUs with assets over $1,000,000 and
subject to the five percent aggregate
limit on fixed assets. Of those,
approximately 150 FCUs would prepare
and file a new waiver request to exceed
the five percent aggregate limit. This
effort, which is estimated to create 15
hours burden per waiver, would no
longer be required under the 2015
proposal. Accordingly, the reduction to
existing paperwork burdens that would
result from the 2015 proposal is
analyzed below:
Estimate of the Reduced Burden by
Eliminating the Waiver Requirement
Estimated FCUs which will no longer
be required to prepare a waiver request
and file a waiver request: 150.
Frequency of waiver request: Annual.
Reduced hour burden: 15.
150 FCUs × 15 hours = 2250 hours
annual reduced burden
In accordance with the requirements
of the PRA, NCUA intends to obtain a
modification of its OMB Control
Number, 3133–0040, to support these
changes. NCUA is submitting a copy of
the 2015 proposal to OMB, along with
an application for a modification of the
OMB Control Number.
The PRA and OMB regulations
require that the public be provided an
opportunity to comment on the
paperwork requirements, including an
agency’s estimate of the burden of the
paperwork requirements. The Board
invites comment on: (1) Whether the
paperwork requirements are necessary;
(2) the accuracy of NCUA’s estimates on
the burden of the paperwork
requirements; (3) ways to enhance the
quality, utility, and clarity of the
paperwork requirements; and (4) ways
to minimize the burden of the
paperwork requirements.
Comments should be sent to the
NCUA Contact and the OMB Reviewer
listed below:
NCUA Contact: Amanda Wallace,
National Credit Union Administration,
1775 Duke Street, Alexandria, Virginia
22314–3428, Fax No. 703–837–2861,
Email: [email protected].
OMB Contact: Office of Management
and Budget, ATTN: Desk Officer for the

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National Credit Union Administration,
Office of Information and Regulatory
Affairs, Washington, DC 20503.

§ 701.36 Federal credit union occupancy,
planning, and disposal of acquired and
abandoned premises.

C. Executive Order 13132

(a) Scope. Section 107(4) of the
Federal Credit Union Act (12 U.S.C.
1757(4)) authorizes a federal credit
union to purchase, hold, and dispose of
property necessary or incidental to its
operations. This section interprets and
implements that provision by
establishing occupancy, planning, and
disposal requirements for acquired and
abandoned premises, and by prohibiting
certain transactions.
This section applies only to federal
credit unions.
*
*
*
*
*
■ 3. Revise § 701.36 paragraph (b) by
removing the following definitions:
‘‘fixed assets’’, ‘‘furniture, fixtures, and
equipment’’, ‘‘investments in fixed
assets’’, ‘‘retained earnings’’, and
‘‘shares’’.
■ 4. Remove § 701.36 paragraph (c).
■ 5. Revise § 701.36 paragraph (d)(2) to
read as follows:
(d) * * *
(2) If a federal credit union acquires
premises for future expansion,
including unimproved land or
unimproved real property, it must
partially occupy them within a
reasonable period, but no later than six
years after the date of acquisition.
NCUA may waive the partial occupation
requirements. To seek a waiver, a
federal credit union must submit a
written request to its Regional Office
and fully explain why it needs the
waiver. The Regional Director will
provide the federal credit union a
written response, either approving or
disapproving the request. The Regional
Director’s decision will be based on
safety and soundness considerations.
*
*
*
*
*
■ 6. In § 701.36 redesignate paragraph
(d) as paragraph (c) and paragraph (e) as
paragraph (d).

Executive Order 13132 encourages
independent regulatory agencies to
consider the impact of their actions on
state and local interests. NCUA, an
independent regulatory agency, as
defined in 44 U.S.C. 3502(5), voluntarily
complies with the executive order to
adhere to fundamental federalism
principles. Because the fixed assets
regulation applies only to FCUs, the
2015 proposal would not have a
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. As such, NCUA
has determined that this rule does not
constitute a policy that has federalism
implications for purposes of the
executive order.
D. Assessment of Federal Regulations
and Policies on Families
NCUA has determined that this rule
will not affect family well-being within
the meaning of Section 654 of the
Treasury and General Government
Appropriations Act of 1999.34
List of Subjects in 12 CFR Part 701
Credit unions, Reporting and
recordkeeping requirements.
By the National Credit Union
Administration Board, on March 19, 2015.
Gerard Poliquin,
Secretary of the Board.

For the reasons stated above, NCUA
proposes to amend 12 CFR 701.36 as
follows:
PART 701—ORGANIZATION AND
OPERATION OF FEDERAL CREDIT
1. The authority for part 701
continues to read as follows:

tkelley on DSK3SPTVN1PROD with PROPOSALS

■

Authority: 12 U.S.C. 1752(5), 1757, 1765,
1757, 1758, 1759, 1761a, 1761b, 1766, 1767,
1782, 1784, 1786, 1787, 1789. Section 701.6
is also authorized by 15 U.S.C. 3717. Section
701.31 is also authorized by 15 U.S.C. 1601
et seq.; 42 U.S.C. 1981 and 3601–3610.
Section 701.35 is also authorized by 42
U.S.C. 4311–4312.

[FR Doc. 2015–06816 Filed 3–27–15; 8:45 am]
BILLING CODE 7535–01–P

Law 105–277, 112 Stat. 2681 (1998).

17:11 Mar 27, 2015

Jkt 235001

PO 00000

Federal Aviation Administration
14 CFR Part 39
[Docket No. FAA–2015–0674; Directorate
Identifier 2014–SW–019–AD]
RIN 2120–AA64

Airworthiness Directives; Airbus
Helicopters Deutschland GmbH
(Previously Eurocopter Deutschland
GmbH) Helicopters
Federal Aviation
Administration (FAA), DOT.
ACTION: Notice of proposed rulemaking
(NPRM).
AGENCY:

We propose to supersede
airworthiness directive (AD) 2014–05–
06 for certain Eurocopter Deutschland
GmbH (ECD) (now Airbus Helicopters
Deutschland GmbH) Model EC135 and
MBB–BK 117 C–2 helicopters to correct
an error. AD 2014–05–06 currently
requires inspecting the flight-control
bearings repetitively, replacing any
loose bearing with an airworthy flightcontrol bearing, and installing bushings
and washers. This proposed AD would
require the same actions. This proposed
AD results from the discovery of an
error in the compliance time for AD
2014–05–06. These proposed actions are
intended to prevent the affected control
lever from shifting, contacting the
helicopter structure, and reducing
control of the helicopter.
DATES: We must receive comments on
this proposed AD by May 29, 2015.
ADDRESSES: You may send comments by
any of the following methods:
• Federal eRulemaking Docket: Go to
http://www.regulations.gov. Follow the
online instructions for sending your
comments electronically.
• Fax: 202–493–2251.
• Mail: Send comments to the U.S.
Department of Transportation, Docket
Operations, M–30, West Building
Ground Floor, Room W12–140, 1200
New Jersey Avenue SE., Washington,
DC 20590–0001.
• Hand Delivery: Deliver to the
‘‘Mail’’ address between 9 a.m. and 5
p.m., Monday through Friday, except
Federal holidays.
SUMMARY:

You may examine the AD docket on
the Internet at http://
www.regulations.gov or in person at the
Docket Operations Office between 9
a.m. and 5 p.m., Monday through
Friday, except Federal holidays. The AD
docket contains this proposed AD, the
European Aviation Safety Agency

2. In § 701.36 revise the section
heading and paragraph (a) to read as
follows:

VerDate Sep<11>2014

DEPARTMENT OF TRANSPORTATION

Examining the AD Docket

■

34 Public

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