Truth in Lending (Regulation Z), 59276-59278 [2018-25398]
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59276
Federal Register / Vol. 83, No. 226 / Friday, November 23, 2018 / Rules and Regulations
III. Regulatory Analysis
12 CFR Part 1013
2(e) Consumer Lease
Administrative Procedure Act
Advertising, Consumer leasing,
Reporting and recordkeeping
requirements, Truth in lending.
*
Under the Administrative Procedure
Act, notice and opportunity for public
comment are not required if the Board
and the Bureau find that notice and
public comment are impracticable,
unnecessary, or contrary to the public
interest.9 The amendments in this rule
are technical and apply the method
previously set forth in the Board Final
Threshold Rules and the Regulation M
Adjustment Calculation Rule. For these
reasons, the Board and the Bureau have
determined that publishing a notice of
proposed rulemaking and providing
opportunity for public comment are
unnecessary. Therefore, the
amendments are adopted in final form.
Regulatory Flexibility Act
Authority and Issuance
For the reasons set forth in the
preamble, the Board amends Regulation
M, 12 CFR part 213, as set forth below:
PART 213—CONSUMER LEASING
(REGULATION M)
1. The authority citation for part 213
continues to read as follows:
■
Authority: 15 U.S.C. 1604 and 1667f;
Pub. L. 111–203 section 1100E, 124 Stat.
1376.
Paperwork Reduction Act
Bureau Congressional Review Act
Statement
List of Subjects
RIN 7100–AF25
*
Advertising, Consumer leasing,
Consumer protection, Federal Reserve
System, Reporting and recordkeeping
requirements.
U.S.C. 553(b)(B).
10 5 U.S.C. 603 and 604.
11 44 U.S.C. 3506; 5 CFR part 1320.
16:13 Nov 21, 2018
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Section 213.2—Definitions
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BUREAU OF CONSUMER FINANCIAL
PROTECTION
For the reasons set forth in the
preamble, the Bureau amends
Regulation M, 12 CFR part 1013, as set
forth below:
PART 1013—CONSUMER LEASING
(REGULATION M)
3. The authority citation for part 1013
continues to read as follows:
■
Authority: 15 U.S.C. 1604 and 1667f; Pub.
L. 111–203 section 1100E, 124 Stat. 1376.
4. In Supplement I to part 1013, under
Section 1013.2—Definitions, under
2(e)—Consumer Lease, paragraph 11.x is
added to read as follows:
Supplement I to Part 1013—Official
Interpretations
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Section 1013.2—Definitions
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[Docket No. R–1633]
BUREAU OF CONSUMER FINANCIAL
PROTECTION
RIN 3170–AA90
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11. * * *
x. From January 1, 2019 through
December 31, 2019, the threshold
amount is $57,200.
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12 CFR Part 226
12 CFR Part 1026
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2(e) Consumer Lease
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95
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12 CFR Part 213
BILLING CODE 4810–AM–P; 6210–01–P
Supplement I to Part 213—Official Staff
Interpretations
Authority and Issuance
Pursuant to the Congressional Review
Act (5 U.S.C. 801 et seq.), the Bureau
will submit a report containing this rule
and other required information to the
U.S. Senate, the U.S. House of
Representatives, and the Comptroller
General of the United States prior to the
rule taking effect. The Office of
Information and Regulatory Affairs
(OIRA) has designated this rule as not
a ‘‘major rule’’ as defined by 5 U.S.C.
804(2).
[FR Doc. 2018–25396 Filed 11–21–18; 8:45 am]
FEDERAL RESERVE SYSTEM
*
In accordance with the Paperwork
Reduction Act of 1995,11 the agencies
reviewed this final rule. No collections
of information pursuant to the
Paperwork Reduction Act are contained
in the final rule.
By order of the Board of Governors of the
Federal Reserve System, under delegated
authority, November 7, 2018.
Ann E. Misback,
Secretary of the Board.
Dated: November 9, 2018.
Mick Mulvaney,
Acting Director, Bureau of Consumer
Financial Protection.
2. In Supplement I to Part 213, under
Section 213.2—Definitions, under 2(e)
Consumer Lease, paragraph 11.x is
added to read as follows:
■
The Regulatory Flexibility Act (RFA)
does not apply to a rulemaking where a
general notice of proposed rulemaking
is not required.10 As noted previously,
the agencies have determined that it is
unnecessary to publish a general notice
of proposed rulemaking for this joint
final rule. Accordingly, the RFA’s
requirements relating to an initial and
final regulatory flexibility analysis do
not apply.
amozie on DSK3GDR082PROD with RULES
BOARD OF GOVERNORS OF THE
FEDERAL RESERVE SYSTEM
*
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11. * * *
x. From January 1, 2019 through
December 31, 2019, the threshold
amount is $57,200.
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*
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Truth in Lending (Regulation Z)
Board of Governors of the
Federal Reserve System (Board); and
Bureau of Consumer Financial
Protection (Bureau).
ACTION: Final rules, official
interpretations and commentary.
AGENCY:
The Board and the Bureau are
publishing final rules amending the
official interpretations and commentary
for the agencies’ regulations that
implement the Truth in Lending Act
(TILA). The Dodd-Frank Wall Street
Reform and Consumer Protection Act
(Dodd-Frank Act) amended TILA by
requiring that the dollar threshold for
exempt consumer credit transactions be
adjusted annually by the annual
percentage increase in the Consumer
Price Index for Urban Wage Earners and
Clerical Workers (CPI–W). If there is no
annual percentage increase in the CPI–
W, the Board and the Bureau will not
adjust this exemption threshold from
the prior year. However, in years
following a year in which the exemption
threshold was not adjusted, the
threshold is calculated by applying the
annual percentage change in the CPI–W
to the dollar amount that would have
resulted, after rounding, if the decreases
and any subsequent increases in the
CPI–W had been taken into account.
SUMMARY:
E:\FR\FM\23NOR1.SGM
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Federal Register / Vol. 83, No. 226 / Friday, November 23, 2018 / Rules and Regulations
Based on the annual percentage increase
in the CPI–W as of June 1, 2018, the
exemption threshold will increase from
$55,800 to $57,200 effective January 1,
2019.
Because the Dodd-Frank Act also
requires similar adjustments in the
Consumer Leasing Act’s threshold for
exempt consumer leases, the Board and
the Bureau are making similar
amendments to each of their respective
regulations implementing the Consumer
Leasing Act elsewhere in this issue of
the Federal Register.
DATES: This final rule is effective
January 1, 2019.
FOR FURTHER INFORMATION CONTACT:
Board: Vivian W. Wong, Senior
Counsel, Division of Consumer and
Community Affairs, Board of Governors
of the Federal Reserve System, at (202)
452–3667; for users of
Telecommunications Device for the Deaf
(TDD) only, contact (202) 263–4869.
Bureau: Shelley Thompson, Counsel,
Office of Regulations, Bureau of
Consumer Financial Protection, at (202)
435–7700.
SUPPLEMENTARY INFORMATION:
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I. Background
The Dodd-Frank Wall Street Reform
and Consumer Protection Act of 2010
(Dodd-Frank Act) increased the
threshold in the Truth in Lending Act
(TILA) for exempt consumer credit
transactions,1 and the threshold in the
Consumer Leasing Act (CLA) for exempt
consumer leases, from $25,000 to
$50,000, effective July 21, 2011.2 In
addition, the Dodd-Frank Act requires
that, on and after December 31, 2011,
these thresholds be adjusted annually
for inflation by the annual percentage
increase in the Consumer Price Index
for Urban Wage Earners and Clerical
Workers (CPI–W), as published by the
Bureau of Labor Statistics. In April
2011, the Board issued a final rule
amending Regulation Z (which
implements TILA) consistent with these
provisions of the Dodd-Frank Act, along
with a similar final rule amending
Regulation M (which implements the
CLA) (collectively, the Board Final
Threshold Rules).3
Title X of the Dodd-Frank Act
transferred rulemaking authority for a
1 Although consumer credit transactions above
the threshold are generally exempt, loans secured
by real property or by personal property used or
expected to be used as the principal dwelling of a
consumer and private education loans are covered
by TILA regardless of the loan amount. See 12 CFR
226.3(b)(1)(i) (Board) and 12 CFR 1026.3(b)(1)(i)
(Bureau).
2 Public Law 111–203, section 1100E, 124 Stat.
1376, 2111 (2010).
3 76 FR 18354 (Apr. 4, 2011); 76 FR 18349 (Apr.
4, 2011).
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16:13 Nov 21, 2018
Jkt 247001
number of consumer financial
protection laws from the Board to the
Bureau, effective July 21, 2011. In
connection with this transfer of
rulemaking authority, the Bureau issued
its own Regulation Z implementing
TILA, 12 CFR part 1026, substantially
duplicating the Board’s Regulation Z.4
Although the Bureau has the authority
to issue rules to implement TILA for
most entities, the Board retains
authority to issue rules under TILA for
certain motor vehicle dealers covered by
section 1029(a) of the Dodd-Frank Act,
and the Board’s Regulation Z continues
to apply to those entities.5
The Board’s and the Bureau’s
regulations,6 and their accompanying
commentaries, provide that the
exemption threshold will be adjusted
annually effective January 1 of each year
based on any annual percentage
increase in the CPI–W that was in effect
on the preceding June 1. They further
provide that any increase in the
threshold amount will be rounded to the
nearest $100 increment. For example, if
the annual percentage increase in the
CPI–W would result in a $950 increase
in the threshold amount, the threshold
amount will be increased by $1,000.
However, if the annual percentage
increase in the CPI–W would result in
a $949 increase in the threshold
amount, the threshold amount will be
increased by $900.7 Since 2011, the
Board and the Bureau have adjusted the
Regulation Z exemption threshold
annually, in accordance with these
rules.
4 See
76 FR 79768 (Dec. 22, 2011); 81 FR 25323
(Apr. 28, 2016).
5 Section 1029(a) of the Dodd-Frank Act states:
‘‘Except as permitted in subsection (b), the Bureau
may not exercise any rulemaking, supervisory,
enforcement, or any other authority * * * over a
motor vehicle dealer that is predominantly engaged
in the sale and servicing of motor vehicles, the
leasing and servicing of motor vehicles, or both.’’
12 U.S.C. 5519(a). Section 1029(b) of the DoddFrank Act states: ‘‘Subsection (a) shall not apply to
any person, to the extent that such person (1)
provides consumers with any services related to
residential or commercial mortgages or selffinancing transactions involving real property; (2)
operates a line of business (A) that involves the
extension of retail credit or retail leases involving
motor vehicles; and (B) in which (i) the extension
of retail credit or retail leases are provided directly
to consumers; and (ii) the contract governing such
extension of retail credit or retail leases is not
routinely assigned to an unaffiliated third party
finance or leasing source; or (3) offers or provides
a consumer financial product or service not
involving or related to the sale, financing, leasing,
rental, repair, refurbishment, maintenance, or other
servicing of motor vehicles, motor vehicle parts, or
any related or ancillary product or service.’’ 12
U.S.C. 5519(b).
6 12 CFR 226.3(b)(1)(ii) (Board) and 12 CFR
1026.3(b)(1)(ii) (Bureau).
7 See comments 3(b)–1 in Supplements I of 12
CFR parts 226 and 1026.
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59277
On November 30, 2016, the Board and
the Bureau published a final rule in the
Federal Register to memorialize the
calculation method used by the agencies
each year to adjust the exemption
threshold to ensure that, as
contemplated by section 1100E(b) of the
Dodd-Frank Act, the values for the
exemption threshold keep pace with the
CPI–W (Regulation Z Adjustment
Calculation Rule).8 The Regulation Z
Adjustment Calculation Rule
memorialized the policy that, if there is
no annual percentage increase in the
CPI–W, the Board and Bureau will not
adjust the exemption threshold from the
prior year. The Regulation Z Adjustment
Calculation Rule also provided that, in
years following a year in which the
exemption threshold was not adjusted
because there was a decrease in the CPI–
W from the previous year, the threshold
is calculated by applying the annual
percentage change in the CPI–W to the
dollar amount that would have resulted,
after rounding, if the decreases and any
subsequent increases in the CPI–W had
been taken into account. If the resulting
amount calculated, after rounding, is
greater than the current threshold, then
the threshold effective January 1 the
following year will increase
accordingly; if the resulting amount
calculated, after rounding, is equal to or
less than the current threshold, then the
threshold effective January 1 the
following year will not change, but
future increases will be calculated based
on the amount that would have resulted,
after rounding.
II. 2019 Adjustment and Commentary
Revision
Effective January 1, 2019, the
exemption threshold amount is
increased from $55,800 to $57,200. This
is based on the CPI–W in effect on June
1, 2018, which was reported on May 10,
2018. The Bureau of Labor Statistics
publishes consumer-based indices
monthly, but does not report a CPI
change on June 1; adjustments are
reported in the middle of the prior
month. The CPI–W is a subset of the
CPI–U index (based on all urban
consumers) and represents
approximately 29 percent of the U.S.
population. The CPI–W reported on
May 10, 2018 reflects a 2.6 percent
increase in the CPI–W from April 2017
to April 2018. Accordingly, the 2.6
percent increase in the CPI–W from
April 2017 to April 2018 results in an
exemption threshold amount of $57,200.
The Board and the Bureau are revising
the commentaries to their respective
regulations to add new comment 3(b)–
8 See
E:\FR\FM\23NOR1.SGM
81 FR 86260 (Nov. 30, 2016).
23NOR1
59278
Federal Register / Vol. 83, No. 226 / Friday, November 23, 2018 / Rules and Regulations
3.x to state that, from January 1, 2019
through December 31, 2019, the
threshold amount is $57,200. These
revisions are effective January 1, 2019.
III. Regulatory Analysis
Administrative Procedure Act
Under the Administrative Procedure
Act, notice and opportunity for public
comment are not required if the Board
and the Bureau find that notice and
public comment are impracticable,
unnecessary, or contrary to the public
interest.9 The amendments in this rule
are technical and apply the method
previously set forth in the Board Final
Threshold Rules and the Regulation Z
Adjustment Calculation Rule. For these
reasons, the Board and the Bureau have
determined that publishing a notice of
proposed rulemaking and providing
opportunity for public comment are
unnecessary. Therefore, the
amendments are adopted in final form.
Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA)
does not apply to a rulemaking where a
general notice of proposed rulemaking
is not required.10 As noted previously,
the agencies have determined that it is
unnecessary to publish a general notice
of proposed rulemaking for this joint
final rule. Accordingly, the RFA’s
requirements relating to an initial and
final regulatory flexibility analysis do
not apply.
Paperwork Reduction Act
In accordance with the Paperwork
Reduction Act of 1995,11 the agencies
reviewed this final rule. No collections
of information pursuant to the
Paperwork Reduction Act are contained
in the final rule.
Bureau Congressional Review Act
Statement
Pursuant to the Congressional Review
Act (5 U.S.C. 801 et seq.), the Bureau
will submit a report containing this rule
and other required information to the
U.S. Senate, the U.S. House of
Representatives, and the Comptroller
General of the United States prior to the
rule taking effect. The Office of
Information and Regulatory Affairs
(OIRA) has designated this rule as not
a ‘‘major rule’’ as defined by 5 U.S.C.
804(2).
amozie on DSK3GDR082PROD with RULES
List of Subjects
12 CFR Part 226
Advertising, Consumer protection,
Federal Reserve System, Reporting and
95
U.S.C. 553(b)(B).
U.S.C. 603 and 604.
11 44 U.S.C. 3506; 5 CFR part 1320.
10 5
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16:13 Nov 21, 2018
Jkt 247001
recordkeeping requirements, Truth in
lending.
12 CFR Part 1026
Advertising, Appraisal, Appraiser,
Banking, Banks, Consumer protection,
Credit, Credit unions, Mortgages,
National banks, Reporting and
recordkeeping requirements, Savings
associations, Truth in lending.
under 3(b)—Credit Over Applicable
Threshold Amount, paragraph 3.x is
added to read as follows:
Supplement I to Part 1026—Official
Interpretations
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Section 1026.3—Exempt Transactions
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Board of Governors of the Federal
Reserve System
3(b) Credit Over Applicable Threshold
Amount
Authority and Issuance
For the reasons set forth in the
preamble, the Board amends Regulation
Z, 12 CFR part 226, as set forth below:
*
PART 226—TRUTH IN LENDING
(REGULATION Z)
1. The authority citation for part 226
continues to read as follows:
■
Authority: 12 U.S.C. 3806; 15 U.S.C. 1604,
1637(c)(5), 1639(l) and 1639h; Pub. L. 111–
24, section 2, 123 Stat. 1734; Pub. L. 111–
203, 124 Stat. 1376.
2. In Supplement I to part 226, under
Section 226.3—Exempt Transactions,
under 3(b) Credit over applicable
threshold amount, paragraph 3.x is
added to read as follows:
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3. * * *
x. From January 1, 2019 through
December 31, 2019, the threshold
amount is $57,200.
*
*
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*
*
By order of the Board of Governors of the
Federal Reserve System, under delegated
authority, November 7, 2018.
Ann E. Misback,
Secretary of the Board.
Dated: November 9, 2018.
Mick Mulvaney,
Acting Director, Bureau of Consumer
Financial Protection.
[FR Doc. 2018–25398 Filed 11–21–18; 8:45 am]
BILLING CODE 4810–AM–P; 6210–01–P
Supplement I to Part 226—Official Staff
Interpretations
DEPARTMENT OF TRANSPORTATION
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Federal Aviation Administration
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Subpart A—General
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14 CFR Part 39
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Section 226.3—Exempt Transactions
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3(b) Credit over applicable threshold
amount.
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3. * * *
x. From January 1, 2019 through
December 31, 2019, the threshold
amount is $57,200.
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Bureau of Consumer Financial
Protection
Authority and Issuance
For the reasons set forth in the
preamble, the Bureau amends
Regulation Z, 12 CFR part 1026, as set
forth below:
PART 1026—TRUTH IN LENDING
(REGULATION Z)
3. The authority citation for part 1026
continues to read as follows:
■
Authority: 12 U.S.C. 2601, 2603–2605,
2607, 2609, 2617, 3353, 5511, 5512, 5532,
5581; 15 U.S.C. 1601 et seq.
4. In Supplement I to part 1026, under
Section 1026.3—Exempt Transactions,
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[Docket No. FAA–2018–0298; Product
Identifier 2017–NM–179–AD; Amendment
39–19488; AD 2018–23–02]
RIN 2120–AA64
Airworthiness Directives; Airbus SAS
Airplanes
Federal Aviation
Administration (FAA), Department of
Transportation (DOT).
ACTION: Final rule.
AGENCY:
We are adopting a new
airworthiness directive (AD) for all
Airbus SAS Model A318 and A319
series airplanes; Model A320–211,
A320–212, A320–214, A320–216, A320–
231, A320–232, and A320–233
airplanes; and Model A321–111, A321–
112, A321–131, A321–211, A321–212,
A321–213, A321–231, and A321–232
airplanes. This AD was prompted by
reports of missing assembly hardware
on the trimmable horizontal stabilizer
actuator (THSA). This AD requires
repetitive inspections and checks of the
lower and upper THSA attachments and
applicable related investigative and
corrective actions; a one-time inspection
of the THSA lower attachment and
SUMMARY:
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]]>Agencies
[Federal Register Volume 83, Number 226 (Friday, November 23, 2018)]
[Rules and Regulations]
[Pages 59276-59278]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-25398]
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FEDERAL RESERVE SYSTEM
12 CFR Part 226
[Docket No. R-1633]
RIN 7100-AF25
BUREAU OF CONSUMER FINANCIAL PROTECTION
12 CFR Part 1026
RIN 3170-AA90
Truth in Lending (Regulation Z)
AGENCY: Board of Governors of the Federal Reserve System (Board); and
Bureau of Consumer Financial Protection (Bureau).
ACTION: Final rules, official interpretations and commentary.
-----------------------------------------------------------------------
SUMMARY: The Board and the Bureau are publishing final rules amending
the official interpretations and commentary for the agencies'
regulations that implement the Truth in Lending Act (TILA). The Dodd-
Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act)
amended TILA by requiring that the dollar threshold for exempt consumer
credit transactions be adjusted annually by the annual percentage
increase in the Consumer Price Index for Urban Wage Earners and
Clerical Workers (CPI-W). If there is no annual percentage increase in
the CPI-W, the Board and the Bureau will not adjust this exemption
threshold from the prior year. However, in years following a year in
which the exemption threshold was not adjusted, the threshold is
calculated by applying the annual percentage change in the CPI-W to the
dollar amount that would have resulted, after rounding, if the
decreases and any subsequent increases in the CPI-W had been taken into
account.
[[Page 59277]]
Based on the annual percentage increase in the CPI-W as of June 1,
2018, the exemption threshold will increase from $55,800 to $57,200
effective January 1, 2019.
Because the Dodd-Frank Act also requires similar adjustments in the
Consumer Leasing Act's threshold for exempt consumer leases, the Board
and the Bureau are making similar amendments to each of their
respective regulations implementing the Consumer Leasing Act elsewhere
in this issue of the Federal Register.
DATES: This final rule is effective January 1, 2019.
FOR FURTHER INFORMATION CONTACT:
Board: Vivian W. Wong, Senior Counsel, Division of Consumer and
Community Affairs, Board of Governors of the Federal Reserve System, at
(202) 452-3667; for users of Telecommunications Device for the Deaf
(TDD) only, contact (202) 263-4869.
Bureau: Shelley Thompson, Counsel, Office of Regulations, Bureau of
Consumer Financial Protection, at (202) 435-7700.
SUPPLEMENTARY INFORMATION:
I. Background
The Dodd-Frank Wall Street Reform and Consumer Protection Act of
2010 (Dodd-Frank Act) increased the threshold in the Truth in Lending
Act (TILA) for exempt consumer credit transactions,\1\ and the
threshold in the Consumer Leasing Act (CLA) for exempt consumer leases,
from $25,000 to $50,000, effective July 21, 2011.\2\ In addition, the
Dodd-Frank Act requires that, on and after December 31, 2011, these
thresholds be adjusted annually for inflation by the annual percentage
increase in the Consumer Price Index for Urban Wage Earners and
Clerical Workers (CPI-W), as published by the Bureau of Labor
Statistics. In April 2011, the Board issued a final rule amending
Regulation Z (which implements TILA) consistent with these provisions
of the Dodd-Frank Act, along with a similar final rule amending
Regulation M (which implements the CLA) (collectively, the Board Final
Threshold Rules).\3\
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\1\ Although consumer credit transactions above the threshold
are generally exempt, loans secured by real property or by personal
property used or expected to be used as the principal dwelling of a
consumer and private education loans are covered by TILA regardless
of the loan amount. See 12 CFR 226.3(b)(1)(i) (Board) and 12 CFR
1026.3(b)(1)(i) (Bureau).
\2\ Public Law 111-203, section 1100E, 124 Stat. 1376, 2111
(2010).
\3\ 76 FR 18354 (Apr. 4, 2011); 76 FR 18349 (Apr. 4, 2011).
---------------------------------------------------------------------------
Title X of the Dodd-Frank Act transferred rulemaking authority for
a number of consumer financial protection laws from the Board to the
Bureau, effective July 21, 2011. In connection with this transfer of
rulemaking authority, the Bureau issued its own Regulation Z
implementing TILA, 12 CFR part 1026, substantially duplicating the
Board's Regulation Z.\4\ Although the Bureau has the authority to issue
rules to implement TILA for most entities, the Board retains authority
to issue rules under TILA for certain motor vehicle dealers covered by
section 1029(a) of the Dodd-Frank Act, and the Board's Regulation Z
continues to apply to those entities.\5\
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\4\ See 76 FR 79768 (Dec. 22, 2011); 81 FR 25323 (Apr. 28,
2016).
\5\ Section 1029(a) of the Dodd-Frank Act states: ``Except as
permitted in subsection (b), the Bureau may not exercise any
rulemaking, supervisory, enforcement, or any other authority * * *
over a motor vehicle dealer that is predominantly engaged in the
sale and servicing of motor vehicles, the leasing and servicing of
motor vehicles, or both.'' 12 U.S.C. 5519(a). Section 1029(b) of the
Dodd-Frank Act states: ``Subsection (a) shall not apply to any
person, to the extent that such person (1) provides consumers with
any services related to residential or commercial mortgages or self-
financing transactions involving real property; (2) operates a line
of business (A) that involves the extension of retail credit or
retail leases involving motor vehicles; and (B) in which (i) the
extension of retail credit or retail leases are provided directly to
consumers; and (ii) the contract governing such extension of retail
credit or retail leases is not routinely assigned to an unaffiliated
third party finance or leasing source; or (3) offers or provides a
consumer financial product or service not involving or related to
the sale, financing, leasing, rental, repair, refurbishment,
maintenance, or other servicing of motor vehicles, motor vehicle
parts, or any related or ancillary product or service.'' 12 U.S.C.
5519(b).
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The Board's and the Bureau's regulations,\6\ and their accompanying
commentaries, provide that the exemption threshold will be adjusted
annually effective January 1 of each year based on any annual
percentage increase in the CPI-W that was in effect on the preceding
June 1. They further provide that any increase in the threshold amount
will be rounded to the nearest $100 increment. For example, if the
annual percentage increase in the CPI-W would result in a $950 increase
in the threshold amount, the threshold amount will be increased by
$1,000. However, if the annual percentage increase in the CPI-W would
result in a $949 increase in the threshold amount, the threshold amount
will be increased by $900.\7\ Since 2011, the Board and the Bureau have
adjusted the Regulation Z exemption threshold annually, in accordance
with these rules.
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\6\ 12 CFR 226.3(b)(1)(ii) (Board) and 12 CFR 1026.3(b)(1)(ii)
(Bureau).
\7\ See comments 3(b)-1 in Supplements I of 12 CFR parts 226 and
1026.
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On November 30, 2016, the Board and the Bureau published a final
rule in the Federal Register to memorialize the calculation method used
by the agencies each year to adjust the exemption threshold to ensure
that, as contemplated by section 1100E(b) of the Dodd-Frank Act, the
values for the exemption threshold keep pace with the CPI-W (Regulation
Z Adjustment Calculation Rule).\8\ The Regulation Z Adjustment
Calculation Rule memorialized the policy that, if there is no annual
percentage increase in the CPI-W, the Board and Bureau will not adjust
the exemption threshold from the prior year. The Regulation Z
Adjustment Calculation Rule also provided that, in years following a
year in which the exemption threshold was not adjusted because there
was a decrease in the CPI-W from the previous year, the threshold is
calculated by applying the annual percentage change in the CPI-W to the
dollar amount that would have resulted, after rounding, if the
decreases and any subsequent increases in the CPI-W had been taken into
account. If the resulting amount calculated, after rounding, is greater
than the current threshold, then the threshold effective January 1 the
following year will increase accordingly; if the resulting amount
calculated, after rounding, is equal to or less than the current
threshold, then the threshold effective January 1 the following year
will not change, but future increases will be calculated based on the
amount that would have resulted, after rounding.
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\8\ See 81 FR 86260 (Nov. 30, 2016).
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II. 2019 Adjustment and Commentary Revision
Effective January 1, 2019, the exemption threshold amount is
increased from $55,800 to $57,200. This is based on the CPI-W in effect
on June 1, 2018, which was reported on May 10, 2018. The Bureau of
Labor Statistics publishes consumer-based indices monthly, but does not
report a CPI change on June 1; adjustments are reported in the middle
of the prior month. The CPI-W is a subset of the CPI-U index (based on
all urban consumers) and represents approximately 29 percent of the
U.S. population. The CPI-W reported on May 10, 2018 reflects a 2.6
percent increase in the CPI-W from April 2017 to April 2018.
Accordingly, the 2.6 percent increase in the CPI-W from April 2017 to
April 2018 results in an exemption threshold amount of $57,200. The
Board and the Bureau are revising the commentaries to their respective
regulations to add new comment 3(b)-
[[Page 59278]]
3.x to state that, from January 1, 2019 through December 31, 2019, the
threshold amount is $57,200. These revisions are effective January 1,
2019.
III. Regulatory Analysis
Administrative Procedure Act
Under the Administrative Procedure Act, notice and opportunity for
public comment are not required if the Board and the Bureau find that
notice and public comment are impracticable, unnecessary, or contrary
to the public interest.\9\ The amendments in this rule are technical
and apply the method previously set forth in the Board Final Threshold
Rules and the Regulation Z Adjustment Calculation Rule. For these
reasons, the Board and the Bureau have determined that publishing a
notice of proposed rulemaking and providing opportunity for public
comment are unnecessary. Therefore, the amendments are adopted in final
form.
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\9\ 5 U.S.C. 553(b)(B).
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Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA) does not apply to a rulemaking
where a general notice of proposed rulemaking is not required.\10\ As
noted previously, the agencies have determined that it is unnecessary
to publish a general notice of proposed rulemaking for this joint final
rule. Accordingly, the RFA's requirements relating to an initial and
final regulatory flexibility analysis do not apply.
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\10\ 5 U.S.C. 603 and 604.
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Paperwork Reduction Act
In accordance with the Paperwork Reduction Act of 1995,\11\ the
agencies reviewed this final rule. No collections of information
pursuant to the Paperwork Reduction Act are contained in the final
rule.
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\11\ 44 U.S.C. 3506; 5 CFR part 1320.
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Bureau Congressional Review Act Statement
Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.),
the Bureau will submit a report containing this rule and other required
information to the U.S. Senate, the U.S. House of Representatives, and
the Comptroller General of the United States prior to the rule taking
effect. The Office of Information and Regulatory Affairs (OIRA) has
designated this rule as not a ``major rule'' as defined by 5 U.S.C.
804(2).
List of Subjects
12 CFR Part 226
Advertising, Consumer protection, Federal Reserve System, Reporting
and recordkeeping requirements, Truth in lending.
12 CFR Part 1026
Advertising, Appraisal, Appraiser, Banking, Banks, Consumer
protection, Credit, Credit unions, Mortgages, National banks, Reporting
and recordkeeping requirements, Savings associations, Truth in lending.
Board of Governors of the Federal Reserve System
Authority and Issuance
For the reasons set forth in the preamble, the Board amends
Regulation Z, 12 CFR part 226, as set forth below:
PART 226--TRUTH IN LENDING (REGULATION Z)
0
1. The authority citation for part 226 continues to read as follows:
Authority: 12 U.S.C. 3806; 15 U.S.C. 1604, 1637(c)(5), 1639(l)
and 1639h; Pub. L. 111-24, section 2, 123 Stat. 1734; Pub. L. 111-
203, 124 Stat. 1376.
0
2. In Supplement I to part 226, under Section 226.3--Exempt
Transactions, under 3(b) Credit over applicable threshold amount,
paragraph 3.x is added to read as follows:
Supplement I to Part 226--Official Staff Interpretations
* * * * *
Subpart A--General
* * * * *
Section 226.3--Exempt Transactions
* * * * *
3(b) Credit over applicable threshold amount.
* * * * *
3. * * *
x. From January 1, 2019 through December 31, 2019, the threshold
amount is $57,200.
* * * * *
Bureau of Consumer Financial Protection
Authority and Issuance
For the reasons set forth in the preamble, the Bureau amends
Regulation Z, 12 CFR part 1026, as set forth below:
PART 1026--TRUTH IN LENDING (REGULATION Z)
0
3. The authority citation for part 1026 continues to read as follows:
Authority: 12 U.S.C. 2601, 2603-2605, 2607, 2609, 2617, 3353,
5511, 5512, 5532, 5581; 15 U.S.C. 1601 et seq.
0
4. In Supplement I to part 1026, under Section 1026.3--Exempt
Transactions, under 3(b)--Credit Over Applicable Threshold Amount,
paragraph 3.x is added to read as follows:
Supplement I to Part 1026--Official Interpretations
* * * * *
Section 1026.3--Exempt Transactions
* * * * *
3(b) Credit Over Applicable Threshold Amount
* * * * *
3. * * *
x. From January 1, 2019 through December 31, 2019, the threshold
amount is $57,200.
* * * * *
By order of the Board of Governors of the Federal Reserve
System, under delegated authority, November 7, 2018.
Ann E. Misback,
Secretary of the Board.
Dated: November 9, 2018.
Mick Mulvaney,
Acting Director, Bureau of Consumer Financial Protection.
[FR Doc. 2018-25398 Filed 11-21-18; 8:45 am]
BILLING CODE 4810-AM-P; 6210-01-P
