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Results of Texas CU Commission Special Meeting with Update on FOM
Tuesday, October 20, 2015 7:00 AM

The Texas Credit Union Commission (TCUD) met on Oct. 16, 2015. Allyson “Missy” Morrow served as chair for the meeting, as Chairman Manny Cavazos was not present due to illness. Of particular interest was an initial proposal to consider updating field-of-membership requirements. See more details below.

TCUD acted on several recommendations made at the Rules Committee meeting, which met on Oct. 15. From these recommendations, TCUD voted to:

  • Adopt Proposed Amendments on:
    • 7 TAC 91.401, Concerning Purchase, Lease, or Sale of Fixed Assets
    • 7 TAC 91.802, Concerning Other Investments
    • 7 TAC 91.803, Concerning Investment Limits and Prohibitions (including one non-substantive change from the original proposal)
    • 7 TAC 91.805, Concerning Loan Participation Investments
    • 7 TAC 91.901, Concerning Reserve Requirements
  • Adopt Proposed New Subchapter K of 7 TAC Chapter 91, Concerning Credit Union Development Districts
    • In the 2015 TX Legislative Session, HB 1626 passed directing the Commission to administer and monitor a credit union development program. The program is intended to encourage credit unions to open branches in geographic areas where there is a demonstrated need for financial services. The new law and rules allow a local government (municipality or county) to submit an application to the Commission for the designation of a development district. The rules cover the purpose and scope of the program, definitions of key terms, application requirements, submission and processing of application, criteria for approval of districts, monitoring and rulemaking. 
  • Adopt Proposed New Rule 7 TAC 97.206, Concerning Posting of Certain Contracts and Enhanced Contract and Performance Monitoring
  • Readopt 7 TAC Part 6, Chapter 91, Subchapter O, (relating to Trust Powers), in its entirety
  • Approve for Publication and Comment the Proposed Amendments to 7 TAC 91.101, concerning Definitions and Interpretations, and 7 TAC 91.301, concerning Field of Membership (FOM).
    • The proposed amendments allow more flexibility to CUs for determining a community of interest and should result in reduced regulatory burden for CUs.

      The proposal revises and updates certain characteristics used to determine if a unifying factor among a group of persons satisfies the requirements and qualifies for inclusion in a CU’s FOM. The proposal clarifies that only a credit union-owned, deposit-taking ATM is included in the definition of “office.”

      The proposed amendments to 91.301, FOM, make changes to reflect that a CU’s FOM may include various communities of interest. More specifically, the amendments expand the local service area requirement to a newly delineated market area with certain limitations. The amendments eliminate many existing restrictions imposed by the Commissioner. The amendments also add a direct marketing restriction. Additionally, the amendments delete the restrictions for underserved communities by granting TCUD a more permissive waiver provision. The proposal makes amendments necessary to include the provisions of Subchapter K, related to CU Development Districts. The amendments change and streamline the notice requirements. Finally, the rule places certain affirmative obligations on a CU that presents an application to expand its FOM.

      Cornerstone looks forward to engaging with Texas state-chartered credit unions to gather suggested changes to the rule, which according to the Commissioner, is just a starting point for discussion. The Commissioner also plans to hold various local town hall meetings to solicit feedback from Texas state-chartered credit unions.

Comments will be due 30 days after publication in the Texas Register, with a deadline likely in late November. The proposed rule can be found here.

For questions or to share comments, please contact Jeff Huffman, president, Texas Credit Union Association, at or Suzanne Yashewski, SVP regulatory compliance counsel, Cornerstone Credit Union League at

As are most Credit Union Commission meetings, this one was comprehensive and covered a lot of area. Credit unions are encouraged to view a more detailed summary of this meeting on the Cornerstone website here.