81 FR 75315 - Temporary Exceptions to FIRREA Appraisal Requirements in Areas Affected by Severe Storms and Flooding in Louisiana

DEPARTMENT OF THE TREASURY
Office of the Comptroller of the Currency
FEDERAL RESERVE SYSTEM
FEDERAL DEPOSIT INSURANCE CORPORATION
NATIONAL CREDIT UNION ADMINISTRATION

Federal Register Volume 81, Issue 210 (October 31, 2016)

Section 2 of the Depository Institutions Disaster Relief Act of 1992 (DIDRA) authorizes the Agencies to make exceptions to statutory and regulatory appraisal requirements under Title XI of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA). The exceptions are available for transactions involving real property located within an area declared to be a major disaster area by the President if the Agencies determine, and describe by publication of a regulation or order, that the exceptions would facilitate recovery from the disaster and would be consistent with safety and soundness. In this statement and order, the Agencies exercise their authority to grant temporary exceptions to the FIRREA appraisal requirements for real estate related transactions, provided certain criteria are met, in the Louisiana parishes declared a major disaster area by President Obama on August 14, 2016, as a result of the severe storms and flooding in Louisiana. The expiration date for the exceptions is December 31, 2017.

[Federal Register Volume 81, Number 210 (Monday, October 31, 2016)]
[Rules and Regulations]
[Pages 75315-75316]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-26234]



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Federal Register / Vol. 81, No. 210 / Monday, October 31, 2016 / 
Rules and Regulations

[[Page 75315]]



DEPARTMENT OF THE TREASURY

Office of the Comptroller of the Currency

12 CFR Part 34

[Docket No. OCC-2016-0030]

FEDERAL RESERVE SYSTEM

12 CFR Part 225

[Docket No. R-1551]
RIN 7100 AE-62

FEDERAL DEPOSIT INSURANCE CORPORATION

12 CFR Part 323

NATIONAL CREDIT UNION ADMINISTRATION

12 CFR Part 722


Temporary Exceptions to FIRREA Appraisal Requirements in Areas 
Affected by Severe Storms and Flooding in Louisiana

AGENCY: Office of the Comptroller of the Currency, Treasury (OCC); 
Board of Governors of the Federal Reserve System (Board); Federal 
Deposit Insurance Corporation (FDIC); and National Credit Union 
Administration (NCUA), collectively referred to as the Agencies.

ACTION: Statement and order; temporary exceptions.

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SUMMARY: Section 2 of the Depository Institutions Disaster Relief Act 
of 1992 (DIDRA) authorizes the Agencies to make exceptions to statutory 
and regulatory appraisal requirements under Title XI of the Financial 
Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA). 
The exceptions are available for transactions involving real property 
located within an area declared to be a major disaster area by the 
President if the Agencies determine, and describe by publication of a 
regulation or order, that the exceptions would facilitate recovery from 
the disaster and would be consistent with safety and soundness. In this 
statement and order, the Agencies exercise their authority to grant 
temporary exceptions to the FIRREA appraisal requirements for real 
estate related transactions, provided certain criteria are met, in the 
Louisiana parishes declared a major disaster area by President Obama on 
August 14, 2016, as a result of the severe storms and flooding in 
Louisiana. The expiration date for the exceptions is December 31, 2017.

DATES: This order is effective on October 31, 2016 and expires for 
specific areas on December 31, 2017.

FOR FURTHER INFORMATION CONTACT: 
    OCC: Robert Parson, Senior Appraisal Policy Advisor, Chief National 
Bank Examiner's Office, at (202) 649-6423; Kevin Lawton, Appraisal 
Specialist, Chief National Bank Examiner's Office, at (202) 649-7152; 
Christopher Manthey, Special Counsel, Chief Counsel's Office, at (202) 
649-6203; or Mitchell Plave, Special Counsel, Chief Counsel's Office, 
at (202) 649-6285 or, for persons who are deaf or hard of hearing, TTY 
(202) 649-5597.
    Board: Carmen D. Holly, Senior Supervisory Financial Analyst, 
Division of Banking Supervision and Regulation at 202-973-6122; Gillian 
Burgess, Counsel, Legal Division, at (202) 736-5564.
    FDIC: Beverlea S. Gardner, Senior Examination Specialist, Division 
of Risk Management and Supervision, at (202) 898-3640; Benjamin K. 
Gibbs, Counsel, Legal Division, at (202) 898- 6726; or Kimberly Stock, 
Counsel, Legal Division, at (202) 898-3815, Federal Deposit Insurance 
Corporation, 550 17th Street NW., Washington, DC 20429.
    NCUA: D. Scott Neat, Director of Supervision, Office of Examination 
and Insurance, at (703) 518-6363; John Brolin, Staff Attorney, Office 
of General Counsel, at (703) 518-6438, National Credit Union 
Administration, 1775 Duke Street, Alexandria, VA 22314.

SUPPLEMENTARY INFORMATION:

Statement

    Section 2 of DIDRA, which added section 1123 to Title XI of 
FIRREA,\1\ authorizes the Agencies to make exceptions to statutory and 
regulatory appraisal requirements for certain transactions. These 
exceptions are available for transactions involving real property 
located in areas in which the President has determined a major disaster 
exists, pursuant to 42 U.S.C. 5170, provided that the exception would 
facilitate recovery from the major disaster and is consistent with 
safety and soundness.
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    \1\ 12 U.S.C. 3352.
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    On August 14, 2016, the President declared that 22 parishes in 
Louisiana were in a major disaster area (Major Disaster Area) due to 
extensive damage that occurred as a result of severe storms and 
subsequent flooding.\2\ The Agencies believe that granting relief from 
the appraisal requirements set forth in Title XI of FIRREA for real 
estate transactions in the Major Disaster Area is consistent with the 
provisions of DIDRA.
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    \2\ Press Release, The White House (Aug. 14, 2016), available at 
https://www.whitehouse.gov/the-press-office/2016/08/14/president-obama-signs-louisiana-disaster-declaration.
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Facilitation of Recovery From the Storms and Flooding Declared as Major 
Disaster

    The Agencies have determined that the disruption of real estate 
markets in the Major Disaster Area interferes with the ability of 
depository institutions to obtain appraisals that comply with all 
statutory and regulatory requirements. Further, the Agencies have 
determined that the disruption may impede institutions in making loans 
and engaging in other transactions that would aid in the reconstruction 
and rehabilitation of the affected area. Accordingly, the Agencies have 
determined that recovery from this major disaster would be facilitated 
by exempting certain transactions involving real estate located in the 
area directly affected by the severe storms and flooding from the real 
estate appraisal requirements of Title XI of FIRREA and its 
implementing regulations.\3\
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    \3\ 12 U.S.C. 3331-3355; 12 CFR 34.41-34.47 (OCC); 12 CFR part 
225, subpart G (Board); 12 CFR part 323, subpart A (FDIC); 12 CFR 
part 722 (NCUA).

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[[Page 75316]]

Consistency With Safety and Soundness

    The Agencies also have determined that the exceptions are 
consistent with safety and soundness, provided that the depository 
institution determines and maintains appropriate documentation of the 
following: (1) The transaction involves real property located in the 
Major Disaster Area; (2) there is a binding commitment to fund the 
transaction that was entered into on or after August 14, 2016, but no 
later than December 31, 2017; and (3) the value of the real property 
supports the institution's decision to enter into the transaction. In 
addition, the transaction must continue to be subject to review by 
management and by the Agencies in the course of examinations of the 
institution.

Expiration Date

    Exceptions made under section 1123 of FIRREA may be provided for no 
more than three years after the President determines that a major 
disaster exists in the area.\4\ The Agencies have determined that the 
exceptions provided for by this order shall expire on December 31, 
2017.
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    \4\ 12 U.S.C. 3352(b).
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Order

    In accordance with section 2 of DIDRA, relief is hereby granted 
from the provisions of Title XI of FIRREA and the Agencies' appraisal 
regulations for any real estate-related financial transaction that 
requires the services of an appraiser under those provisions, provided 
that the institution determines, and maintains documentation made 
available to the Agencies upon request, of the following:
    (1) The transaction involves real property located in one of the 22 
parishes declared a major disaster area as a result of severe storms 
and flooding in Louisiana by the President on August 14, 2016 
(identified in the Appendix);
    (2) There is a binding commitment to fund a transaction that was 
entered into on or after August 14, 2016, but no later than December 
31, 2017; and
    (3) The value of the real property supports the institution's 
decision to enter into the transaction.

Appendix (Major Disaster Area)

    Designated Parishes: Acadia, Ascension, Avoyelles, East Baton 
Rouge, East Feliciana, Evangeline, Iberia, Iberville, Jefferson Davis, 
Lafayette, Livingston, Pointe Coupee, St. Helena, St. James, St. 
Landry, St. Martin, St. Tammany, Tangipahoa, Vermilion, Washington, 
West Baton Rouge and West Feliciana.

    Dated: October 19, 2016.
Thomas J. Curry,
Comptroller of the Currency.

    By order of the Board of Governors of the Federal Reserve 
System, October 21, 2016.

Margaret McCloskey Shanks,

Deputy Secretary of the Board.

    Dated at Washington, DC, October 19, 2016.

    By order of the Board of Directors.

Federal Deposit Insurance Corporation.

Robert E. Feldman,

Executive Secretary.

    Dated at Alexandria, VA, October 27, 2016.

    By order of the Board of Directors.

National Credit Union Administration.

Gerard Poliquin,
Secretary of the Board.
[FR Doc. 2016-26234 Filed 10-28-16; 8:45 am]
 BILLING CODE 6210-01-P