Community Reinvestment Act-Community Development, 18614-18618 [06-3472]
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PART 114—CORPORATE AND LABOR
ORGANIZATION ACTIVITY
10. The authority citation for part 114
is revised to read as follows:
I
Authority: 2 U.S.C. 431(8), 431(9), 432,
434, 437d(a)(8), 438(a)(8), 441b.
11. In § 114.9, paragraphs (a) and (b)
are revised and new paragraph (e) is
added to read as follows:
I
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§ 114.9 Use of corporate or labor
organization facilities.
(a) Use of corporate facilities for
individual volunteer activity by
stockholders and employees.
(1) Stockholders and employees of the
corporation may, subject to the rules
and practices of the corporation and 11
CFR 100.54, make occasional, isolated,
or incidental use of the facilities of a
corporation for individual volunteer
activity in connection with a Federal
election and will be required to
reimburse the corporation only to the
extent that the overhead or operating
costs of the corporation are increased. A
corporation may not condition the
availability of its facilities on their being
used for political activity, or on support
for or opposition to any particular
candidate or political party. As used in
this paragraph, occasional, isolated, or
incidental use generally means—
(i) When used by employees during
working hours, an amount of activity
which does not prevent the employee
from completing the normal amount of
work which that employee usually
carries out during such work period; or
(ii) When used by stockholders other
than employees during the working
period, such use does not interfere with
the corporation in carrying out its
normal activities.
(2) Safe harbor. For the purposes of
paragraph (a)(1) of this section, the
following shall be considered
occasional, isolated, or incidental use of
corporate facilities:
(i) Any individual volunteer activity
that does not exceed one hour per week
or four hours per month, regardless of
whether the activity is undertaken
during or after normal working hours; or
(ii) Any such activity that constitutes
voluntary individual Internet activities
(as defined in 11 CFR 100.94), in excess
of one hour per week or four hours per
month, regardless of whether the
activity is undertaken during or after
normal working hours, provided that:
(A) As specified in 11 CFR 100.54, the
activity does not prevent the employee
from completing the normal amount of
work for which the employee is paid or
is expected to perform;
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(B) The activity does not increase the
overhead or operating costs of the
corporation; and
(C) The activity is not performed
under coercion.
(3) A stockholder or employee who
makes more than occasional, isolated, or
incidental use of a corporation’s
facilities for individual volunteer
activities in connection with a Federal
election is required to reimburse the
corporation within a commercially
reasonable time for the normal and
usual rental charge, as defined in 11
CFR 100.52(d)(2), for the use of such
facilities.
(b) Use of labor organization facilities
for individual volunteer activity by
officials, members, and employees.
(1) The officials, members, and
employees of a labor organization may,
subject to the rules and practices of the
labor organization and 11 CFR 100.54,
make occasional, isolated, or incidental
use of the facilities of a labor
organization for individual volunteer
activity in connection with a Federal
election and will be required to
reimburse the labor organization only to
the extent that the overhead or operating
costs of the labor organization are
increased. A labor organization may not
condition the availability of its facilities
on their being used for political activity,
or on support for or opposition to any
particular candidate or political party.
As used in this paragraph, occasional,
isolated, or incidental use generally
means—
(i) When used by employees during
working hours, an amount of activity
during any particular work period
which does not prevent the employee
from completing the normal amount of
work which that employee usually
carries out during such work period; or
(ii) When used by members other than
employees during the working period,
such use does not interfere with the
labor organization in carrying out its
normal activities.
(2) Safe harbor. For the purposes of
paragraph (b)(1) of this section, the
following shall be considered
occasional, isolated, or incidental use of
labor organization facilities:
(i) Any individual volunteer activity
that does not exceed one hour per week
or four hours per month, regardless of
whether the activity is undertaken
during or after normal working hours; or
(ii) Any such activity that constitutes
voluntary individual Internet activities
(as defined in 11 CFR 100.94), in excess
of one hour per week or four hours per
month, regardless of whether the
activity is undertaken during or after
normal working hours, provided that:
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(A) As specified in 11 CFR 100.54, the
activity does not prevent the employee
from completing the normal amount of
work for which the employee is paid or
is expected to perform;
(B) The activity does not increase the
overhead or operating costs of the labor
organization; and
(C) The activity is not performed
under coercion.
(3) The officials, members, and
employees who make more than
occasional, isolated, or incidental use of
a labor organization’s facilities for
individual volunteer activities in
connection with a Federal election are
required to reimburse the labor
organization within a commercially
reasonable time for the normal and
usual rental charge, as defined in 11
CFR 100.52(d)(2), for the use of such
facilities.
*
*
*
*
*
(e) Nothing in this section shall be
construed to alter the provisions in 11
CFR Part 114 regarding communications
to and beyond a restricted class.
Dated: March 27, 2006.
Michael E. Toner,
Chairman, Federal Election Commission.
[FR Doc. 06–3190 Filed 4–11–06; 8:45 am]
BILLING CODE 6715–01–P
DEPARTMENT OF THE TREASURY
Office of Thrift Supervision
12 CFR Part 563e
[No. 2006–16]
RIN 1550–AB48
Community Reinvestment Act—
Community Development
Office of Thrift Supervision,
Treasury (OTS).
ACTION: Final rule.
AGENCY:
SUMMARY: In this final rule, OTS is
revising the definition of ‘‘community
development’’ in its Community
Reinvestment Act (CRA) regulations to
reduce burden and provide greater
flexibility to meet community needs.
The change is designed to encourage
savings associations to increase their
community development lending,
qualified investments, and community
development services in distressed or
underserved rural areas and designated
disaster areas. This change will make
OTS’s definition of ‘‘community
development’’ and the definition of the
other federal banking agencies uniform.
OTS is also making a technical change
to conform the lettering of its definitions
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to that of the other federal banking
agencies.
Accompanying this final rule and
published in the Notices portion of
today’s Federal Register, is a Notice and
Request for Comment to revise OTS’s
CRA guidance. That notice contains
proposed questions and answers related
to the revised definition of ‘‘community
development’’ and other topics as well
as revisions to existing questions and
answers.
DATES: This rule is effective on April 12,
2006.
FOR FURTHER INFORMATION CONTACT:
Celeste Anderson, Senior Program
Manager, Operation Risk, (202) 906–
7990; Richard Bennett, Counsel,
Regulations and Legislation Division,
(202) 906–7409, Office of Thrift
Supervision, 1700 G Street, NW.,
Washington, DC 20552.
SUPPLEMENTARY INFORMATION:
I. Introduction
On November 24, 2004, OTS
published a notice of proposed
rulemaking (NPR) proposing changes to,
and soliciting comment on, its CRA
regulations in two areas: (1) The
definition of ‘‘community development’’
and (2) the assignment of ratings. 69 FR
68257. OTS indicated that it was
considering addressing these areas to
reduce burden to the extent consistent
with the safe and sound supervision of
the industry and provide institutions
with more flexibility to make their own
determinations about how best to serve
their communities.
OTS designed the proposal to further
the CRA burden reduction it began in its
final rule published in the Federal
Register on August 18, 2004 (69 FR
51155), which revised the definition of
‘‘small savings association’’ (2004 Final
Rule). It also furthered the burden
reductions in the interim final rule
published in the Federal Register on
November 24, 2004 (69 FR 68239) as
part of OTS’s review of regulations
under section 2222 of the Economic
Growth and Regulatory Paperwork
Reduction Act of 1996 (EGRPRA)
(EGRPRA Interim Final Rule).
On March 2, 2005, OTS adopted
changes to the way it assigns CRA
ratings. 70 FR 10023. Specifically, OTS
provided additional flexibility to each
savings association evaluated under the
large retail institution test to determine
the combination of lending, investment,
and service it will use to meet the credit
needs of the local communities in
which it is chartered, consistent with
safe and sound operations. OTS
deferred action, however, on revising
the definition of ‘‘community
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development.’’ OTS noted that the
Federal Deposit Insurance Corporation
(FDIC) had also issued a proposal to
expand the definition of ‘‘community
development.’’ 69 FR 51611 (August 20,
2004). OTS indicated that it was
deferring action on this portion of its
proposal to allow for further
consideration of, and coordination on,
these and other proposals.
On March 11, 2005, the Office of the
Comptroller of the Currency (OCC), the
Board of Governors of the Federal
Reserve System (Board), and the FDIC
issued a joint notice of proposed
rulemaking which, among other things,
proposed to expand the definition of
‘‘community development’’ to include
certain community development
activities in underserved rural areas and
designated disaster areas. 70 FR 12148
(Three-Agency Proposal). Like OTS’s
proposal, the Three-Agency Proposal
responded to suggestions from both
institutions and community
organizations that the current definition
of ‘‘community development’’ was too
narrow.
II. OTS’s November 2004 Proposal
Under OTS’s current CRA regulation
at 12 CFR 563e.12(f), ‘‘community
development’’ means:
(1) Affordable housing (including
multifamily rental housing) for low-or
moderate-income individuals;
(2) Community services targeted to
low-or moderate-income individuals;
(3) Activities that promote economic
development by financing businesses or
farms that meet the size eligibility
standards of the Small Business
Administration’s Development
Company or Small Business Investment
Company programs (13 CFR 121.301) or
have gross annual revenues of $1
million or less; or
(4) Activities that revitalize or
stabilize low-or moderate-income
geographies. 12 CFR 563e.12(f).
The definition of ‘‘community
development’’ significantly affects the
requirements on large retail savings
associations. OTS evaluates them under
a three-part test that can include
consideration of their ‘‘community
development’’ loans and services, as
well as their qualified investments. To
earn CRA credit for these activities, the
primary purpose must be ‘‘community
development.’’ 12 CFR 563e.12 and
563e.21–563e.24.
The definition also affects the
requirements for wholesale or limited
purpose savings associations, since they
are evaluated under a test specifically
focused on their community
development lending, qualified
investments, and community
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development services. 12 CFR 563e.25.
The definition could even affect small
savings associations. For a small savings
association, OTS considers its
performance in making community
development loans and qualified
investments and providing community
development services for purposes of
raising a rating, where the savings
association so requests. 69 FR at 51159.
The appropriate definition of
‘‘community development’’ was an
issue discussed in the July 2001 joint
advance notice of proposed rulemaking
and the February 2004 joint notice of
proposed rulemaking. OTS’s November
2004 proposal would have revised the
definition of ‘‘community development’’
with respect to rural areas and solicited
comment on also encompassing any
areas affected by natural or other
disasters or other major community
disruptions.
With respect to rural areas, OTS
proposed to expand the second and
fourth paragraphs of the community
development definition. Under the
expanded definition, community
development would also include
community services targeted to
individuals in rural areas and activities
that revitalize or stabilize rural areas.
OTS did not propose a specific
definition of ‘‘rural’’ in the NPR.
However, it solicited comments on the
appropriate definition. 69 FR at 68258–
68259.
The proposal also solicited comment
on further encouraging savings
associations to perform community
development activities in any areas
affected by natural or other disasters or
other major community disruptions.
OTS designed this portion of the
proposal to build on the long-standing
OTS policy of extending CRA credit for
relief efforts in the wake of natural and
other disasters. This policy was
formalized in OTS Thrift Bulletin 71
(August 8, 1997), which states, ‘‘OTS
will consider the institution’s response
to a disaster as an important element of
‘‘performance context’’ under [OTS’s]
Community Reinvestment Act
regulations (12 CFR § 563e.21(b)) when
evaluating the institution’s
reconstruction, stabilization and
redevelopment activities in its
community.’’ OTS has reiterated this
policy in a long line of agency guidance
pertaining to natural disasters,
including Hurricanes Katrina, Rita, and
Wilma, as well as other disasters such
as the September 11, 2001 terrorist
attacks.
III. The Comments
As summarized in the March 2005
final rule, OTS received over 4,000
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comments on its November 2004
proposal. The vast majority of
comments came from consumer and
community organizations and
representatives (Consumer Comments).
These comments opposed the proposal,
though a significant number did not
address the portion of the proposal on
the community development definition.
Many expressed concern that the
proposal would allow thrifts to serve
affluent neighborhoods in rural areas
and areas affected by natural disasters,
while neglecting low- and moderateincome neighborhoods. They argued
that expanding the definition of
‘‘community development’’ would
burden low- and moderate-income
individuals who would have no other
option but to turn to predatory and
subprime lenders to finance their homes
and small businesses. One joint
comment letter from 28 members of the
House of Representatives (including 13
members of the Committee on Financial
Services) argued that neither the CRA
nor its legislative history supports
treating all rural activities as qualifying
for CRA credit. The Representatives
emphasized that the proper focus of the
CRA should be on the needs of low- and
moderate-income areas without a
distinction between urban and rural
areas.
In contrast, OTS received about two
hundred comments from financial
institutions and industry trade
associations (Financial Institution
Comments). Almost all of these
supported the proposal, including the
portion on the definition of community
development. A common argument was
that thrifts with assessment areas that
include rural areas often have few
opportunities to provide qualified CRA
loans, investments, and services. As a
result, these thrifts often invest in
housing bonds in statewide areas that
do not benefit the institution’s
community. Further, the current rule
encourages thrifts to undertake activities
primarily in urban areas, leaving many
rural areas underserved,
notwithstanding the fact that low- and
moderate-income families are often
dispersed throughout rural areas.
There was no consensus among those
who commented on how best to
delineate the rural areas that would
count for community development. Yet,
there was strong sentiment that the
public needed a definition for clarity.
IV. Today’s Final Rule Revising the
Community Development Definition
Having carefully considered the
comments, OTS is revising the
definition of ‘‘community development’’
to be the same as the definition that the
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Board, OCC, and FDIC adopted in their
August 2005 final rule. The revision is
designed to encourage all savings
associations to increase their
community development lending,
qualified investments, and community
development services in certain
nonmetropolitan middle-income areas
as well as areas affected by designated
disasters. The reason OTS is making this
revision is to encourage more
community development activities in
more areas, to cover the full range of
activities that should receive favorable
consideration, and to reduce burden by
affording savings associations greater
flexibility in serving their communities.
This revision will make OTS’s
definition of ‘‘community development’’
and the definition of the other federal
banking agencies uniform.
OTS does not believe that the
exclusive focus of CRA must be on lowand moderate-income individuals and
geographies. The CRA statute indicates:
‘‘It is the purpose of this title to require
each appropriate Federal financial
supervisory agency to use its authority
when examining financial institutions,
to encourage such institutions to help
meet the credit needs of the local
communities in which they are
chartered consistent with the safe and
sound operation of such institutions.’’
12 U.S.C. 2901(b) (emphasis added).
Congress also provided in the CRA
statute that the written evaluations are
to assess ‘‘the institution’s record of
meeting the credit needs of its entire
community, including low and
moderate-income neighborhoods.’’ 12
U.S.C. 2906(a)(1) (emphasis added).
Given the statutory text, it is
appropriate that we evaluate an
institution’s record of meeting the credit
needs of its entire community,
particularly, but not limited to, low- and
moderate-income neighborhoods and
individuals. Accordingly, OTS believes
the CRA rule must allow for due
consideration of an institution’s service
to areas and individuals in its
community with credit needs, even if
those individuals or areas are not lowor moderate-income.
Today’s revisions will help ensure
that OTS can appropriately consider
how well an institution serves the credit
needs of certain nonmetropolitan
middle-income areas and areas affected
by disasters, since these areas can also
be part of an institution’s community.
The revisions do this, in part, by
increasing the number and kinds of
tracts, particularly rural tracts, in which
a savings association’s community
development activities would receive
full CRA credit.
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Specifically, OTS is expanding the
fourth paragraph of the community
development definition. This is the
‘‘revitalize or stabilize’’ category of the
definition of ‘‘community
development.’’ Under the expanded
definition, community development
will include activities that revitalize or
stabilize:
• Low-or moderate-income
geographies;
• Designated disaster areas; or
• Distressed or underserved,
nonmetropolitan middle-income
geographies designated by OTS based
on rates of poverty, unemployment, and
population loss or based on population
size, density, and dispersion.
Under the revised definition of
‘‘community development,’’ eligible
rural tracts will also include
nonmetropolitan middle-income tracts
designated by OTS as distressed or
underserved based on either of two sets
of criteria: (1) Criteria indicating a
community is in distress (rates of
poverty, unemployment, and population
loss) or (2) criteria indicating a
community may have difficulty meeting
essential community needs (population
size, density, and dispersion).
‘‘Nonmetropolitan’’ means an area
outside of an MSA. Eligible rural tracts
will continue to include tracts currently
defined as low-income or as moderateincome. OTS will base the ‘‘distressed
or underserved’’ designations on
objective criteria. OTS will designate a
nonmetropolitan middle-income tract if
it is in a county that meets one or more
of the following triggers that the
Community Development Financial
Institution (CDFI) Fund employs as
‘‘distress criteria’: (1) An unemployment
rate of at least 1.5 times the national
average; (2) a poverty rate of 20 percent
or more; or (3) a population loss of ten
percent or more between the previous
and most recent decennial census or a
net migration loss of five percent or
more over the five-year period
preceding the most recent census. 12
CFR 1805.201(b)(3). While the CDFI
Fund uses other criteria as well,
including an income trigger different
from the definition of ‘‘low-or moderateincome’’ under the CRA regulations,
OTS is not incorporating these other
criteria. Activities will qualify as
revitalizing or stabilizing in these tracts,
like in low-or moderate-income tracts,
based on the regulation and applicable
guidance.
A nonmetropolitan middle-income
tract will also be designated if it meets
criteria for population size, density, and
dispersion that indicate the area’s
population is sufficiently small, thin,
and distant from a population center
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that the tract is likely to have difficulty
financing the fixed costs of meeting
essential community needs. OTS will
use, as the basis for the designations, the
‘‘urban influence codes’’ maintained by
the Economic Research Service of the
United States Department of
Agriculture. These codes can be found
at www.ers.usda.gov/Briefing/Rurality/
urbaninf. In designated areas, savings
association financing for construction,
expansion, improvement, maintenance,
or operation of essential infrastructure
or facilities for health services,
education, public safety, public
services, industrial parks, or affordable
housing, generally, will be considered to
meet essential community needs, so
long as the infrastructure or facility
serves low- and moderate-income
individuals. Other savings association
activities in such areas, generally, will
not qualify for revitalization or
stabilization consideration unless the
area meets the distress criteria. In these
cases, the decision about whether a
particular activity qualifies for such
consideration, based on the regulation
and applicable guidance, will continue
to be made on a case-by-case basis.
The distressed or underserved,
nonmetropolitan middle-income
geographies OTS designates will be
listed on the web site of the Federal
Financial Institutions Examination
Council (www.ffiec.gov). That web site
contains the list of eligible rural tracts
that are distressed or underserved. OTS
will use the same list as the other three
federal banking agencies. Year-to-year
changes in the tracts designated based
on the distress criteria are expected to
be minimal; to account for such changes
there will be a uniform lag period of
twelve months for removal from the list
of any tract designated based on those
criteria. The lag will help promote
investments that take an extended
period to arrange. A qualifying loan,
investment, or service in the area will
count as long as the savings association
made or entered into a binding
commitment to make the loan or
investment while the area remains on
the FFIEC list. It will also count if the
savings association provided or entered
into a binding commitment to provide
the service during the same period.
OTS is also revising the definition of
‘‘community development’’ to include
savings association activities to
revitalize or stabilize designated disaster
areas as eligible for CRA consideration.
Under the revised community
development definition, a ‘‘designated
disaster area’’ is an area that has
received an official designation as a
disaster area.
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This change will serve to codify,
through regulation, OTS’s long-standing
policy of encouraging savings
associations to take an active role in
assisting in disaster recovery efforts.
Particularly in light of several recent
severe hurricanes, it is appropriate that
OTS recognize the critical role that
savings associations should play in
helping revitalize affected communities
and assisting borrowers affected to
recover their financial strength.
Examiners will give significant weight
to a savings association’s revitalization
activities in a disaster area that benefit
low- or moderate-income individuals.
Accompanying this final rule and
published in the ‘‘Notice’’ portion of
today’s Federal Register, is a Notice and
Request for Comment to revise OTS’s
CRA guidance as contained in the
Interagency Questions and Answers
Regarding Community Reinvestment. 65
FR 36620 (July 12, 2001). That notice
contains proposed questions and
answers related to the revised definition
of ‘‘community development’’ and other
topics as well as revisions to existing
questions and answers. The proposed
guidance in that notice is consistent
with final guidance the other federal
banking agencies recently issued. See 71
FR 12424 (March 10, 2006).
V. Technical Amendment
OTS is also making a technical change
to conform the lettering of the
definitions in its CRA rule to that of the
other federal banking agencies. Because
OTS’s rule applies to savings
associations rather than banks, OTS’s
rule does not define the term ‘‘bank’’
whereas the CRA rules of the other
federal banking agencies do. Compare
12 CFR 563e.12 with 12 CFR 25.12(e),
228.12(e), and 345.12(e). As a result,
OTS designated many of the definitions
in its rule with the letter that precedes
the letter the other federal banking
agencies use in their rules. These
designations have caused technical
complications, including complications
in referencing the appropriate paragraph
of the rule for purposes of interagency
guidance.
Today’s final rule reserves one
lettered paragraph in § 563e.12 to
provide for greater consistency among
the federal banking agencies regulations.
Regulatory Analysis
Administrative Procedure Act; Riegle
Community Development and
Regulatory Improvement Act of 1994
OTS finds that there is good cause to
dispense with the 30-day delay of
effective date mandated by the
Administrative Procedure Act. 5 U.S.C.
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553. OTS believes that this procedure is
unnecessary and contrary to the public
interest because this final rule imposes
no additional requirements. It reduces
burden by expanding the types of
community development activities for
which savings associations may receive
CRA consideration. It is particularly
appropriate that the provisions
regarding CRA credit for revitalizing
and stabilizing designated disaster areas
are put into effect immediately in light
of the unprecedented and tragic
devastation caused by several recent
Gulf coast hurricanes. In this way, OTS
will further encourage savings
associations to take an active role in
assisting in disaster recovery efforts.
Section 302 of the Riegle Community
Development and Regulatory
Improvement Act of 1994 provides that
regulations that impose additional
reporting, disclosure, or other new
requirements may not take effect before
the first day of the quarter following
publication. 12 U.S.C. 4802. This
section does not apply because this final
rule imposes no additional
requirements. It reduces burden by
expanding the types of community
development activities for which
savings associations may receive CRA
consideration.
Paperwork Reduction Act
In accordance with the requirements
of the Paperwork Reduction Act of 1995,
OTS may not conduct or sponsor, and
a respondent is not required to respond
to, an information collection unless it
displays a currently valid Office of
Management and Budget (OMB) control
number. This collection of information
is currently approved under OMB
Control Number 1550–0012. This final
rule does not change the collection of
information.
Regulatory Flexibility Act
Pursuant to section 605(b) of the
Regulatory Flexibility Act, OTS certifies
that the final rule will not have a
significant economic impact on a
substantial number of small entities. It
will not impose any additional
paperwork or regulatory reporting
requirements. It will simply encourage
savings associations to increase their
community development lending,
qualified investments, and community
development services in certain
nonmetropolitan middle-income areas
and areas affected by disasters. The
technical amendment to the paragraph
lettering in § 563e.12 has no impact
whatsoever.
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Executive Order 12866 Determination
OTS has determined that this final
rule is not a significant regulatory action
under Executive Order 12866.
Unfunded Mandates Reform Act of 1995
Determination
Section 202 of the Unfunded
Mandates Reform Act of 1995, Public
Law 104–4 (Unfunded Mandates Act)
requires that an agency prepare a
budgetary impact statement before
promulgating a rule that includes a
Federal mandate that may result in
expenditure by State, local, and tribal
governments, in the aggregate, or by the
private sector, of $100 million or more
in any one year (adjusted annually for
inflation). If a budgetary impact
statement is required, section 205 of the
Unfunded Mandates Act also requires
an agency to identify and consider a
reasonable number of regulatory
alternatives before promulgating a rule.
OTS has determined that this rule will
not result in expenditures by State,
local, and tribal governments, or by the
private sector, exceeding the
expenditure threshold. Accordingly,
OTS has not prepared a budgetary
impact statement nor specifically
addressed the regulatory alternatives
considered.
Executive Order 13132
OTS has determined that this final
rule does not have any Federalism
implications, as required by Executive
Order 13132.
List of Subjects in 12 CFR Part 563e
Community development, Credit,
Investments, Reporting and
recordkeeping requirements, Savings
associations.
Dated: March 31, 2006.
By the Office of Thrift Supervision.
John M. Reich,
Director.
[FR Doc. 06–3472 Filed 4–11–06; 8:45 am]
BILLING CODE 6720–01–P
DEPARTMENT OF TRANSPORTATION
Federal Aviation Administration
14 CFR Part 39
Airworthiness Directives; Boeing
Model 747–200C and –200F Series
Airplanes
For the reasons outlined in the
preamble, the Office of Thrift
Supervision amends part 563e of
chapter V of title 12 of the Code of
Federal Regulations as set forth below:
I
PART 563e—COMMUNITY
REINVESTMENT
1. The authority citation for part 563e
continues to read as follows:
I
Authority: 12 U.S.C. 1462a, 1463, 1464,
1467a, 1814, 1816, 1828(c), and 2901 through
2907.
cprice-sewell on PROD1PC66 with RULES
*
*
*
*
(e) [Reserved]
*
*
*
*
*
(g) Community development means:
*
*
*
*
*
(4) Activities that revitalize or
stabilize—
(i) Low- or moderate-income
geographies;
(ii) Designated disaster areas; or
(iii) Distressed or underserved,
nonmetropolitan middle-income
geographies designated by OTS based
on—
(A) Rates of poverty, unemployment,
and population loss; or
(B) Population size, density, and
dispersion. Activities revitalize and
stabilize geographies designated based
on population size, density, and
dispersion if they help to meet essential
community needs, including needs of
low- and moderate-income individuals.
*
*
*
*
*
RIN 2120–AA64
12 CFR Chapter V
2. In § 563e.12:
a. Redesignate paragraphs (e) through
(w) as (f) through (x);
I b. Add and reserve a new paragraph
(e); and
I c. Revise newly redesignated
paragraph (g)(4) to read as follows:
I
I
15:11 Apr 11, 2006
Definitions.
*
[Docket No. FAA–2005–22423; Directorate
Identifier 2005–NM–068–AD; Amendment
39–14556; AD 2006–08–02]
Office of Thrift Supervision
VerDate Aug<31>2005
§ 563e.12
Jkt 208001
Federal Aviation
Administration (FAA), Department of
Transportation (DOT).
ACTION: Final rule.
AGENCY:
SUMMARY: The FAA is superseding an
existing airworthiness directive (AD),
which applies to certain Boeing Model
747–200C and –200F series airplanes.
That AD currently requires repetitive
inspections to find fatigue cracking in
the upper chord of the upper deck floor
beams, and repair if necessary. For
certain airplanes, the existing AD also
provides an optional repair/
modification, which extends certain
repetitive inspection intervals. This new
AD reduces the compliance time for all
initial inspections and reduces the
repetitive interval for a certain
PO 00000
Frm 00030
Fmt 4700
Sfmt 4700
inspection. This AD results from new
reports of cracks in the upper deck floor
beams occurring at lower flight cycles.
We are issuing this AD to find and fix
cracking in certain upper deck floor
beams. Such cracking could extend and
sever floor beams at a floor panel
attachment hole location and could
result in rapid decompression and loss
of controllability of the airplane.
DATES: This AD becomes effective May
17, 2006.
The Director of the Federal Register
approved the incorporation by reference
of Boeing Alert Service Bulletin 747–
53A2439, Revision 1, dated March 10,
2005, as listed in the AD as of May 17,
2006.
On March 15, 2004 (69 FR 5920,
February 9, 2004), the Director of the
Federal Register approved the
incorporation by reference of Boeing
Alert Service Bulletin 747–53A2439,
dated July 5, 2001.
ADDRESSES: You may examine the AD
docket on the Internet at https://
dms.dot.gov or in person at the Docket
Management Facility, U.S. Department
of Transportation, 400 Seventh Street,
SW., Nassif Building, Room PL–401,
Washington, DC.
Contact Boeing Commercial
Airplanes, P.O. Box 3707, Seattle,
Washington 98124–2207, for service
information identified in this AD.
FOR FURTHER INFORMATION CONTACT: Ivan
Li, Aerospace Engineer, Airframe
Branch, ANM–120S, FAA, Seattle
Aircraft Certification Office, 1601 Lind
Avenue, SW., Renton, Washington
98055–4056; telephone (425) 917–6437;
fax (425) 917–6590.
SUPPLEMENTARY INFORMATION:
Examining the Docket
You may examine the airworthiness
directive (AD) docket on the Internet at
https://dms.dot.gov or in person at the
Docket Management Facility office
between 9 a.m. and 5 p.m., Monday
through Friday, except Federal holidays.
The Docket Management Facility office
(telephone (800) 647–5227) is located on
the plaza level of the Nassif Building at
the street address stated in the
ADDRESSES section.
Discussion
The FAA issued a notice of proposed
rulemaking (NPRM) to amend 14 CFR
part 39 to include an AD that
supersedes AD 2004–03–11, amendment
39–13455 (69 FR 5920, February 9,
2004). The existing AD applies to
certain Boeing Model 747–200C and
–200F series airplanes. That NPRM was
published in the Federal Register on
September 16, 2005 (70 FR 54668). That
E:\FR\FM\12APR1.SGM
12APR1
]]>Agencies
[Federal Register Volume 71, Number 70 (Wednesday, April 12, 2006)]
[Rules and Regulations]
[Pages 18614-18618]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 06-3472]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF THE TREASURY
Office of Thrift Supervision
12 CFR Part 563e
[No. 2006-16]
RIN 1550-AB48
Community Reinvestment Act--Community Development
AGENCY: Office of Thrift Supervision, Treasury (OTS).
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: In this final rule, OTS is revising the definition of
``community development'' in its Community Reinvestment Act (CRA)
regulations to reduce burden and provide greater flexibility to meet
community needs. The change is designed to encourage savings
associations to increase their community development lending, qualified
investments, and community development services in distressed or
underserved rural areas and designated disaster areas. This change will
make OTS's definition of ``community development'' and the definition
of the other federal banking agencies uniform. OTS is also making a
technical change to conform the lettering of its definitions
[[Page 18615]]
to that of the other federal banking agencies.
Accompanying this final rule and published in the Notices portion
of today's Federal Register, is a Notice and Request for Comment to
revise OTS's CRA guidance. That notice contains proposed questions and
answers related to the revised definition of ``community development''
and other topics as well as revisions to existing questions and
answers.
DATES: This rule is effective on April 12, 2006.
FOR FURTHER INFORMATION CONTACT: Celeste Anderson, Senior Program
Manager, Operation Risk, (202) 906-7990; Richard Bennett, Counsel,
Regulations and Legislation Division, (202) 906-7409, Office of Thrift
Supervision, 1700 G Street, NW., Washington, DC 20552.
SUPPLEMENTARY INFORMATION:
I. Introduction
On November 24, 2004, OTS published a notice of proposed rulemaking
(NPR) proposing changes to, and soliciting comment on, its CRA
regulations in two areas: (1) The definition of ``community
development'' and (2) the assignment of ratings. 69 FR 68257. OTS
indicated that it was considering addressing these areas to reduce
burden to the extent consistent with the safe and sound supervision of
the industry and provide institutions with more flexibility to make
their own determinations about how best to serve their communities.
OTS designed the proposal to further the CRA burden reduction it
began in its final rule published in the Federal Register on August 18,
2004 (69 FR 51155), which revised the definition of ``small savings
association'' (2004 Final Rule). It also furthered the burden
reductions in the interim final rule published in the Federal Register
on November 24, 2004 (69 FR 68239) as part of OTS's review of
regulations under section 2222 of the Economic Growth and Regulatory
Paperwork Reduction Act of 1996 (EGRPRA) (EGRPRA Interim Final Rule).
On March 2, 2005, OTS adopted changes to the way it assigns CRA
ratings. 70 FR 10023. Specifically, OTS provided additional flexibility
to each savings association evaluated under the large retail
institution test to determine the combination of lending, investment,
and service it will use to meet the credit needs of the local
communities in which it is chartered, consistent with safe and sound
operations. OTS deferred action, however, on revising the definition of
``community development.'' OTS noted that the Federal Deposit Insurance
Corporation (FDIC) had also issued a proposal to expand the definition
of ``community development.'' 69 FR 51611 (August 20, 2004). OTS
indicated that it was deferring action on this portion of its proposal
to allow for further consideration of, and coordination on, these and
other proposals.
On March 11, 2005, the Office of the Comptroller of the Currency
(OCC), the Board of Governors of the Federal Reserve System (Board),
and the FDIC issued a joint notice of proposed rulemaking which, among
other things, proposed to expand the definition of ``community
development'' to include certain community development activities in
underserved rural areas and designated disaster areas. 70 FR 12148
(Three-Agency Proposal). Like OTS's proposal, the Three-Agency Proposal
responded to suggestions from both institutions and community
organizations that the current definition of ``community development''
was too narrow.
II. OTS's November 2004 Proposal
Under OTS's current CRA regulation at 12 CFR 563e.12(f),
``community development'' means:
(1) Affordable housing (including multifamily rental housing) for
low-or moderate-income individuals;
(2) Community services targeted to low-or moderate-income
individuals;
(3) Activities that promote economic development by financing
businesses or farms that meet the size eligibility standards of the
Small Business Administration's Development Company or Small Business
Investment Company programs (13 CFR 121.301) or have gross annual
revenues of $1 million or less; or
(4) Activities that revitalize or stabilize low-or moderate-income
geographies. 12 CFR 563e.12(f).
The definition of ``community development'' significantly affects
the requirements on large retail savings associations. OTS evaluates
them under a three-part test that can include consideration of their
``community development'' loans and services, as well as their
qualified investments. To earn CRA credit for these activities, the
primary purpose must be ``community development.'' 12 CFR 563e.12 and
563e.21-563e.24.
The definition also affects the requirements for wholesale or
limited purpose savings associations, since they are evaluated under a
test specifically focused on their community development lending,
qualified investments, and community development services. 12 CFR
563e.25. The definition could even affect small savings associations.
For a small savings association, OTS considers its performance in
making community development loans and qualified investments and
providing community development services for purposes of raising a
rating, where the savings association so requests. 69 FR at 51159.
The appropriate definition of ``community development'' was an
issue discussed in the July 2001 joint advance notice of proposed
rulemaking and the February 2004 joint notice of proposed rulemaking.
OTS's November 2004 proposal would have revised the definition of
``community development'' with respect to rural areas and solicited
comment on also encompassing any areas affected by natural or other
disasters or other major community disruptions.
With respect to rural areas, OTS proposed to expand the second and
fourth paragraphs of the community development definition. Under the
expanded definition, community development would also include community
services targeted to individuals in rural areas and activities that
revitalize or stabilize rural areas.
OTS did not propose a specific definition of ``rural'' in the NPR.
However, it solicited comments on the appropriate definition. 69 FR at
68258-68259.
The proposal also solicited comment on further encouraging savings
associations to perform community development activities in any areas
affected by natural or other disasters or other major community
disruptions. OTS designed this portion of the proposal to build on the
long-standing OTS policy of extending CRA credit for relief efforts in
the wake of natural and other disasters. This policy was formalized in
OTS Thrift Bulletin 71 (August 8, 1997), which states, ``OTS will
consider the institution's response to a disaster as an important
element of ``performance context'' under [OTS's] Community Reinvestment
Act regulations (12 CFR Sec. 563e.21(b)) when evaluating the
institution's reconstruction, stabilization and redevelopment
activities in its community.'' OTS has reiterated this policy in a long
line of agency guidance pertaining to natural disasters, including
Hurricanes Katrina, Rita, and Wilma, as well as other disasters such as
the September 11, 2001 terrorist attacks.
III. The Comments
As summarized in the March 2005 final rule, OTS received over 4,000
[[Page 18616]]
comments on its November 2004 proposal. The vast majority of comments
came from consumer and community organizations and representatives
(Consumer Comments). These comments opposed the proposal, though a
significant number did not address the portion of the proposal on the
community development definition. Many expressed concern that the
proposal would allow thrifts to serve affluent neighborhoods in rural
areas and areas affected by natural disasters, while neglecting low-
and moderate-income neighborhoods. They argued that expanding the
definition of ``community development'' would burden low- and moderate-
income individuals who would have no other option but to turn to
predatory and subprime lenders to finance their homes and small
businesses. One joint comment letter from 28 members of the House of
Representatives (including 13 members of the Committee on Financial
Services) argued that neither the CRA nor its legislative history
supports treating all rural activities as qualifying for CRA credit.
The Representatives emphasized that the proper focus of the CRA should
be on the needs of low- and moderate-income areas without a distinction
between urban and rural areas.
In contrast, OTS received about two hundred comments from financial
institutions and industry trade associations (Financial Institution
Comments). Almost all of these supported the proposal, including the
portion on the definition of community development. A common argument
was that thrifts with assessment areas that include rural areas often
have few opportunities to provide qualified CRA loans, investments, and
services. As a result, these thrifts often invest in housing bonds in
statewide areas that do not benefit the institution's community.
Further, the current rule encourages thrifts to undertake activities
primarily in urban areas, leaving many rural areas underserved,
notwithstanding the fact that low- and moderate-income families are
often dispersed throughout rural areas.
There was no consensus among those who commented on how best to
delineate the rural areas that would count for community development.
Yet, there was strong sentiment that the public needed a definition for
clarity.
IV. Today's Final Rule Revising the Community Development Definition
Having carefully considered the comments, OTS is revising the
definition of ``community development'' to be the same as the
definition that the Board, OCC, and FDIC adopted in their August 2005
final rule. The revision is designed to encourage all savings
associations to increase their community development lending, qualified
investments, and community development services in certain
nonmetropolitan middle-income areas as well as areas affected by
designated disasters. The reason OTS is making this revision is to
encourage more community development activities in more areas, to cover
the full range of activities that should receive favorable
consideration, and to reduce burden by affording savings associations
greater flexibility in serving their communities. This revision will
make OTS's definition of ``community development'' and the definition
of the other federal banking agencies uniform.
OTS does not believe that the exclusive focus of CRA must be on
low- and moderate-income individuals and geographies. The CRA statute
indicates: ``It is the purpose of this title to require each
appropriate Federal financial supervisory agency to use its authority
when examining financial institutions, to encourage such institutions
to help meet the credit needs of the local communities in which they
are chartered consistent with the safe and sound operation of such
institutions.'' 12 U.S.C. 2901(b) (emphasis added). Congress also
provided in the CRA statute that the written evaluations are to assess
``the institution's record of meeting the credit needs of its entire
community, including low and moderate-income neighborhoods.'' 12 U.S.C.
2906(a)(1) (emphasis added).
Given the statutory text, it is appropriate that we evaluate an
institution's record of meeting the credit needs of its entire
community, particularly, but not limited to, low- and moderate-income
neighborhoods and individuals. Accordingly, OTS believes the CRA rule
must allow for due consideration of an institution's service to areas
and individuals in its community with credit needs, even if those
individuals or areas are not low-or moderate-income.
Today's revisions will help ensure that OTS can appropriately
consider how well an institution serves the credit needs of certain
nonmetropolitan middle-income areas and areas affected by disasters,
since these areas can also be part of an institution's community. The
revisions do this, in part, by increasing the number and kinds of
tracts, particularly rural tracts, in which a savings association's
community development activities would receive full CRA credit.
Specifically, OTS is expanding the fourth paragraph of the
community development definition. This is the ``revitalize or
stabilize'' category of the definition of ``community development.''
Under the expanded definition, community development will include
activities that revitalize or stabilize:
Low-or moderate-income geographies;
Designated disaster areas; or
Distressed or underserved, nonmetropolitan middle-income
geographies designated by OTS based on rates of poverty, unemployment,
and population loss or based on population size, density, and
dispersion.
Under the revised definition of ``community development,'' eligible
rural tracts will also include nonmetropolitan middle-income tracts
designated by OTS as distressed or underserved based on either of two
sets of criteria: (1) Criteria indicating a community is in distress
(rates of poverty, unemployment, and population loss) or (2) criteria
indicating a community may have difficulty meeting essential community
needs (population size, density, and dispersion). ``Nonmetropolitan''
means an area outside of an MSA. Eligible rural tracts will continue to
include tracts currently defined as low-income or as moderate-income.
OTS will base the ``distressed or underserved'' designations on
objective criteria. OTS will designate a nonmetropolitan middle-income
tract if it is in a county that meets one or more of the following
triggers that the Community Development Financial Institution (CDFI)
Fund employs as ``distress criteria': (1) An unemployment rate of at
least 1.5 times the national average; (2) a poverty rate of 20 percent
or more; or (3) a population loss of ten percent or more between the
previous and most recent decennial census or a net migration loss of
five percent or more over the five-year period preceding the most
recent census. 12 CFR 1805.201(b)(3). While the CDFI Fund uses other
criteria as well, including an income trigger different from the
definition of ``low-or moderate-income'' under the CRA regulations, OTS
is not incorporating these other criteria. Activities will qualify as
revitalizing or stabilizing in these tracts, like in low-or moderate-
income tracts, based on the regulation and applicable guidance.
A nonmetropolitan middle-income tract will also be designated if it
meets criteria for population size, density, and dispersion that
indicate the area's population is sufficiently small, thin, and distant
from a population center
[[Page 18617]]
that the tract is likely to have difficulty financing the fixed costs
of meeting essential community needs. OTS will use, as the basis for
the designations, the ``urban influence codes'' maintained by the
Economic Research Service of the United States Department of
Agriculture. These codes can be found at www.ers.usda.gov/Briefing/
Rurality/urbaninf. In designated areas, savings association financing
for construction, expansion, improvement, maintenance, or operation of
essential infrastructure or facilities for health services, education,
public safety, public services, industrial parks, or affordable
housing, generally, will be considered to meet essential community
needs, so long as the infrastructure or facility serves low- and
moderate-income individuals. Other savings association activities in
such areas, generally, will not qualify for revitalization or
stabilization consideration unless the area meets the distress
criteria. In these cases, the decision about whether a particular
activity qualifies for such consideration, based on the regulation and
applicable guidance, will continue to be made on a case-by-case basis.
The distressed or underserved, nonmetropolitan middle-income
geographies OTS designates will be listed on the web site of the
Federal Financial Institutions Examination Council (www.ffiec.gov).
That web site contains the list of eligible rural tracts that are
distressed or underserved. OTS will use the same list as the other
three federal banking agencies. Year-to-year changes in the tracts
designated based on the distress criteria are expected to be minimal;
to account for such changes there will be a uniform lag period of
twelve months for removal from the list of any tract designated based
on those criteria. The lag will help promote investments that take an
extended period to arrange. A qualifying loan, investment, or service
in the area will count as long as the savings association made or
entered into a binding commitment to make the loan or investment while
the area remains on the FFIEC list. It will also count if the savings
association provided or entered into a binding commitment to provide
the service during the same period.
OTS is also revising the definition of ``community development'' to
include savings association activities to revitalize or stabilize
designated disaster areas as eligible for CRA consideration. Under the
revised community development definition, a ``designated disaster
area'' is an area that has received an official designation as a
disaster area.
This change will serve to codify, through regulation, OTS's long-
standing policy of encouraging savings associations to take an active
role in assisting in disaster recovery efforts. Particularly in light
of several recent severe hurricanes, it is appropriate that OTS
recognize the critical role that savings associations should play in
helping revitalize affected communities and assisting borrowers
affected to recover their financial strength. Examiners will give
significant weight to a savings association's revitalization activities
in a disaster area that benefit low- or moderate-income individuals.
Accompanying this final rule and published in the ``Notice''
portion of today's Federal Register, is a Notice and Request for
Comment to revise OTS's CRA guidance as contained in the Interagency
Questions and Answers Regarding Community Reinvestment. 65 FR 36620
(July 12, 2001). That notice contains proposed questions and answers
related to the revised definition of ``community development'' and
other topics as well as revisions to existing questions and answers.
The proposed guidance in that notice is consistent with final guidance
the other federal banking agencies recently issued. See 71 FR 12424
(March 10, 2006).
V. Technical Amendment
OTS is also making a technical change to conform the lettering of
the definitions in its CRA rule to that of the other federal banking
agencies. Because OTS's rule applies to savings associations rather
than banks, OTS's rule does not define the term ``bank'' whereas the
CRA rules of the other federal banking agencies do. Compare 12 CFR
563e.12 with 12 CFR 25.12(e), 228.12(e), and 345.12(e). As a result,
OTS designated many of the definitions in its rule with the letter that
precedes the letter the other federal banking agencies use in their
rules. These designations have caused technical complications,
including complications in referencing the appropriate paragraph of the
rule for purposes of interagency guidance.
Today's final rule reserves one lettered paragraph in Sec. 563e.12
to provide for greater consistency among the federal banking agencies
regulations.
Regulatory Analysis
Administrative Procedure Act; Riegle Community Development and
Regulatory Improvement Act of 1994
OTS finds that there is good cause to dispense with the 30-day
delay of effective date mandated by the Administrative Procedure Act. 5
U.S.C. 553. OTS believes that this procedure is unnecessary and
contrary to the public interest because this final rule imposes no
additional requirements. It reduces burden by expanding the types of
community development activities for which savings associations may
receive CRA consideration. It is particularly appropriate that the
provisions regarding CRA credit for revitalizing and stabilizing
designated disaster areas are put into effect immediately in light of
the unprecedented and tragic devastation caused by several recent Gulf
coast hurricanes. In this way, OTS will further encourage savings
associations to take an active role in assisting in disaster recovery
efforts.
Section 302 of the Riegle Community Development and Regulatory
Improvement Act of 1994 provides that regulations that impose
additional reporting, disclosure, or other new requirements may not
take effect before the first day of the quarter following publication.
12 U.S.C. 4802. This section does not apply because this final rule
imposes no additional requirements. It reduces burden by expanding the
types of community development activities for which savings
associations may receive CRA consideration.
Paperwork Reduction Act
In accordance with the requirements of the Paperwork Reduction Act
of 1995, OTS may not conduct or sponsor, and a respondent is not
required to respond to, an information collection unless it displays a
currently valid Office of Management and Budget (OMB) control number.
This collection of information is currently approved under OMB Control
Number 1550-0012. This final rule does not change the collection of
information.
Regulatory Flexibility Act
Pursuant to section 605(b) of the Regulatory Flexibility Act, OTS
certifies that the final rule will not have a significant economic
impact on a substantial number of small entities. It will not impose
any additional paperwork or regulatory reporting requirements. It will
simply encourage savings associations to increase their community
development lending, qualified investments, and community development
services in certain nonmetropolitan middle-income areas and areas
affected by disasters. The technical amendment to the paragraph
lettering in Sec. 563e.12 has no impact whatsoever.
[[Page 18618]]
Executive Order 12866 Determination
OTS has determined that this final rule is not a significant
regulatory action under Executive Order 12866.
Unfunded Mandates Reform Act of 1995 Determination
Section 202 of the Unfunded Mandates Reform Act of 1995, Public Law
104-4 (Unfunded Mandates Act) requires that an agency prepare a
budgetary impact statement before promulgating a rule that includes a
Federal mandate that may result in expenditure by State, local, and
tribal governments, in the aggregate, or by the private sector, of $100
million or more in any one year (adjusted annually for inflation). If a
budgetary impact statement is required, section 205 of the Unfunded
Mandates Act also requires an agency to identify and consider a
reasonable number of regulatory alternatives before promulgating a
rule. OTS has determined that this rule will not result in expenditures
by State, local, and tribal governments, or by the private sector,
exceeding the expenditure threshold. Accordingly, OTS has not prepared
a budgetary impact statement nor specifically addressed the regulatory
alternatives considered.
Executive Order 13132
OTS has determined that this final rule does not have any
Federalism implications, as required by Executive Order 13132.
List of Subjects in 12 CFR Part 563e
Community development, Credit, Investments, Reporting and
recordkeeping requirements, Savings associations.
Office of Thrift Supervision
12 CFR Chapter V
0
For the reasons outlined in the preamble, the Office of Thrift
Supervision amends part 563e of chapter V of title 12 of the Code of
Federal Regulations as set forth below:
PART 563e--COMMUNITY REINVESTMENT
0
1. The authority citation for part 563e continues to read as follows:
Authority: 12 U.S.C. 1462a, 1463, 1464, 1467a, 1814, 1816,
1828(c), and 2901 through 2907.
0
2. In Sec. 563e.12:
0
a. Redesignate paragraphs (e) through (w) as (f) through (x);
0
b. Add and reserve a new paragraph (e); and
0
c. Revise newly redesignated paragraph (g)(4) to read as follows:
Sec. 563e.12 Definitions.
* * * * *
(e) [Reserved]
* * * * *
(g) Community development means:
* * * * *
(4) Activities that revitalize or stabilize--
(i) Low- or moderate-income geographies;
(ii) Designated disaster areas; or
(iii) Distressed or underserved, nonmetropolitan middle-income
geographies designated by OTS based on--
(A) Rates of poverty, unemployment, and population loss; or
(B) Population size, density, and dispersion. Activities revitalize
and stabilize geographies designated based on population size, density,
and dispersion if they help to meet essential community needs,
including needs of low- and moderate-income individuals.
* * * * *
Dated: March 31, 2006.
By the Office of Thrift Supervision.
John M. Reich,
Director.
[FR Doc. 06-3472 Filed 4-11-06; 8:45 am]
BILLING CODE 6720-01-P
