In light of last week’s U.S. Supreme Court decision, the National Credit Union Administration said Tuesday it will reinstate the rural districts for 18 credit unions that had been removed as federal courts evaluated the agency’s Field of Membership rule.
“The lack of financial access is especially prevalent in rural communities, which have experienced the withdrawal of financial institutions over the last decade,” NCUA Chairman Rodney Hood wrote in a letter to credit unions Tuesday. “The Supreme Court’s decision will assist the agency’s efforts to bring these important and often overlooked communities back into the financial mainstream.”
The American Bankers Association had challenged the Field of Membership rule’s revised definition of rural district. A U.S. District Court agreed with the ABA, saying that the NCUA had exceeded its authority under federal law. That ruling was overturned on appeal and last week, the Supreme Court refused to consider the case.
The NCUA’s Office of Credit Union Resources and Expansion will contact the 18 credit unions, Hood said.
In addition, the NCUA will begin evaluating rural district applications for credit unions that had been delayed while the challenge was considered. The agency also will begin accepting new rural district field of membership applications.
“A proposed area would generally qualify as a rural district if it has well-defined, contiguous geographic boundaries, and the total population of the proposed district does not exceed one million,” the NCUA said, in explaining the criteria for approval.
Hood said the agency also will consider a final Field of Membership rule at its July 31 meeting.