NCUA’s latest legal opinion letter addresses contiguous geographic boundaries, recognizing that several Hawaiian islands can be contiguous for the purposes of the agency’s rural district regulation, despite being separated by a body of water.
NCUA General Counsel Michael McKenna points out that the opinion is limited to the “unique factual circumstances” described in the letter.
According to McKenna, the proposed geographic area met the criteria required.
NCUA’s chartering manual provides that an area of any geographic size qualifies as a rural district if:
In addition, McKenna noted that the Federal Credit Union Act gives NCUA the ability to define rural district, because it is undefined in the legislation. NCUA’s definition of rural district doesn’t exclude an area from becoming a rural district because there happens to be a body of water in the proposed geographic area.
For a closer look at the letter, see CUNA’s CompBlog entry on the subject.