NCRC Lawsuit Against NCUA CAP Repeal in Limbo

ALEXANDRIA, Va.-The National Community Reinvestment Coalition filed suit against NCUA at the beginning of 2002 for its elimination of the Community Action Plan regulation. The CAP was removed through an interim final rulemaking at the end of 2001, which did not allow for public comment that NCRC claimed is required under the Administrative Procedure Act. NCUA did establish a comment period following the interim final rule and following that, the board approved a permanent final rule repealing CAP. The board’s position has been that the prior two comment periods the rule faced as a proposal, which saw more than 400 negative comments compared to a handful in favor, was sufficient. However, NCRC has alleged that NCUA violated the APA and it suffered material injury from the repeal of CAP. NCRC claimed that the information that would have been included in credit unions’ CAPs would have helped them determine how credit unions are fulfilling their mission to serve the underserved and advise consumers. According to NCUA, however, specific business plans and much of the information in the CAP would have been kept confidential. The agency also issued a statement following the lawsuit’s filing that Congress specifically ruled out community reinvestment provisions when writing the Credit Union Membership Access Act, because there was not a need for it. Additionally, community credit unions’ business plans already have to demonstrate how they intend to serve the entire community. While briefs were traded back and forth between the interested parties in a timely manner, U.S. District Court Judge Henry Kennedy, Jr., who is not held to any particular timetable, has let the issue slide for the bulk of the year. NCRC also produced a study of Home Mortgage Disclosure Act data alleging discrimination in credit union lending, but credit union trade association number crunchers poked holes throughout the study. [email protected]