[Federal Register Volume 59, Number 150 (Friday, August 5, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-19259]


[[Page Unknown]]

[Federal Register: August 5, 1994]


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Part X

Department of the Treasury



Office of the Comptroller of the Currency



12 CFR Part 34



Federal Reserve System



12 CFR Parts 225 and 226



Federal Deposit Insurance Corporation



12 CFR Part 323



Department of the Treasury



Office of Thrift Supervision



12 CFR Part 564



National Credit Union Administration



12 CFR Part 722



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Real Estate Appraisal Exceptions in Major Disaster Areas, Joint Order; 
and Truth in Lending; FRS Final Rule
DEPARTMENT OF THE TREASURY

Office of the Comptroller of the Currency

12 CFR Part 34

FEDERAL RESERVE SYSTEM

12 CFR Part 225

FEDERAL DEPOSIT INSURANCE CORPORATION

12 CFR Part 323

DEPARTMENT OF THE TREASURY

Office of Thrift Supervision

12 CFR Part 564

NATIONAL CREDIT UNION ADMINISTRATION

12 CFR Part 722

 
Real Estate Appraisal Exceptions in Major Disaster Areas

AGENCIES: Office of the Comptroller of the Currency, Treasury; Board of 
Governors of the Federal Reserve System; Federal Deposit Insurance 
Corporation; Office of Thrift Supervision, Treasury; and National 
Credit Union Administration.

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 Federal financial institutions 
regulatory agencies to make exceptions to statutory and regulatory 
requirements relating to appraisals for certain transactions. The 
exceptions are available for transactions that involve real property in 
major disaster areas when the exceptions would facilitate recovery from 
the disaster and would be consistent with safety and soundness. 
Expiration dates for certain transactions are set out in the 
SUPPLEMENTARY INFORMATION section.

DATES: This order is effective on August 5, 1994 and expires for 
specific areas on the dates indicated in the SUPPLEMENTARY INFORMATION 
section.

FOR FURTHER INFORMATION CONTACT:

Office of the Comptroller of the Currency (OCC)

    William C. Kerr, National Bank Examiner or Thomas E. Watson, 
National Bank Examiner (202) 874-5170, Office of the Chief National 
Bank Examiner; or Horace G. Sneed, (202) 874-4460, Senior Attorney, 
Bank Operations and Assets Division, 250 E Street SW., Washington, DC 
20219.

Board of Governors of the Federal Reserve System (Board)

    Rhoger H. Pugh, Assistant Director, (202) 728-5883, Stanley B. 
Rediger, Supervisory Financial Analyst, (202) 452-2629, Virginia M. 
Gibbs, Supervisory Financial Analyst, (202) 452-2521, Division of 
Banking Supervision and Regulation; or Deneen Donnley-Evans, Staff 
Attorney, (202) 736-5567, Legal Division. For the hearing impaired 
only, contact Dorothea Thompson, Telecommunications Device for the Deaf 
(TDD), (202) 452-3544, 20th and C Streets NW., Washington, DC 20551.

Federal Deposit Insurance Corporation (FDIC)

    Robert F. Miailovich, Associate Director, (202) 898-6918, James D. 
Leitner, Examination Specialist, (202) 898-6790, Division of 
Supervision; or Walter P. Doyle, Counsel, (202) 898-3682, Legal 
Division, 550 17th Street NW., Washington, DC 20429.

Office of Thrift Supervision, Treasury (OTS)

    Robert Fishman, Acting Deputy Assistant Director, Policy, (202) 
906-5672; Deirdre Kvartunas, Program Analyst, (202) 906-7933; Diana 
Garmus, Deputy Assistant Director, Corporate Activities, (202) 906-
5683; Ellen J. Sazzman, Attorney, Regulations and Legislation Division, 
Chief Counsel's Office, (202) 907-7133; 1700 G Street NW., Washington, 
DC 20552.

National Credit Union Administration (NCUA)

    Michael J. McKenna, Office of General Counsel, (703) 518-6540, or 
Herb Yolles, Office of Examination and Insurance, (703) 518-6360, 1775 
Duke Street, Alexandria, VA 22314.

SUPPLEMENTARY INFORMATION:

Statement

    Section 2 of DIDRA, 12 U.S.C. 3352, authorizes the agencies to make 
exceptions to statutory and regulatory appraisal requirements for 
transactions with respect to real property located in areas that the 
President has determined, pursuant to section 5170 of Title 42, that a 
major disaster exists, provided that the exception would facilitate 
recovery from the major disaster and is consistent with safety and 
soundness.\1\ Such exceptions expire not later than three years after 
the date of the President's determination that a major disaster exists 
in the area.
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    \1\The agencies must make the exception no later than 30 months 
after the date on which the President determines that a major 
disaster exists in the area.
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    Since July 7, 1994, and continuing, the President has declared 
several areas as Major Disaster Areas in certain Alabama, Florida, and 
Georgia counties because of the extensive flooding that occurred and is 
continuing. The agencies believe that granting relief from the 
appraisal requirements for certain real estate transactions in all such 
areas affected by this flooding is consistent with the provisions of 
the DIDRA.
    The agencies have determined that the disruption of real estate 
markets in all such affected areas interferes with the ability of 
depository institutions to obtain appraisals that comply with statutory 
and regulatory requirements and, therefore, 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 excepting transactions involving real estate 
located in the area directly affected by the flooding from the real 
estate appraisal requirements of Title XI of the Financial Institutions 
Reform, Recovery, and Enforcement Act of 1989 (FIRREA) as amended, 12 
U.S.C. 3331 et seq., and regulations promulgated thereto. This has the 
effect of excepting certain transactions from the definition of 
``federally related transactions.''
    The agencies have also determined that safety and soundness would 
not be adversely affected by such exceptions so long as the depository 
institution's records relating to any such excepted transaction clearly 
indicate either that the property involved was directly affected by the 
major disaster or that the transaction would facilitate recovery from 
the disaster and there is a binding commitment to fund the transaction 
within three years after the date the major disaster was declared. In 
addition, the transaction must continue to be subject to review by 
management and by the agencies in the course of examination of the 
institution under normal supervisory standards relating to safety and 
soundness, though the transactions need not comply with the specific 
requirements of Title XI of FIRREA and the agencies' appraisal 
regulations.

Expiration Dates

    Any exceptions provided under the order shall expire not later than 
three years after the date on which the President determines, pursuant 
to section 401 of the Robert T. Stafford Disaster Relief and Emergency 
Assistance Act, 42 U.S.C. 5170, that a major disaster exists in the 
area. Accordingly, exceptions for the major disasters declared due to 
the flooding expire on: July 8, 1997 for Alabama counties; July 10, 
1997 for Florida counties; and July 7, 1997 for Georgia counties. 
Exceptions for any other counties in this area that have been declared 
major disasters by the President as a result of the flooding that began 
on or about July 7, 1994 expire 3 years after the date of such 
declaration.

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:
    (1) The transaction involves real estate located in an area that 
the President has determined, pursuant to section 401 of the Robert 
T. Stafford Disaster Relief and Emergency Assistance Act, 42 U.S.C. 
5170, is a major disaster area as a result of the July 1994 flooding 
in Alabama, Florida, and Georgia, and has been designated eligible 
for Federal assistance by the Federal Emergency Management Agency 
(FEMA);\1\
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    \1\The Alabama, Florida, and Georgia counties affected are 
listed in the appendix to this order. The exception would also 
include any other such areas that the President subsequently 
declares are major disaster areas as a result of the flooding.
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    (2)(a) The real property involved was directly affected by the 
major disaster, or
    (b) The real property involved was not directly affected by the 
major disaster but the institution's records explain how the 
transaction would facilitate recovery from the disaster;
    (3) There is a binding commitment to fund a transaction that is 
made within three years after the date the major disaster was 
declared by the President; and
    (4) The institution retains in its files, for examiner review, 
appropriate documentation supporting the property's valuation.

Appendix to Order

Alabama: Barbour, Coffee, Conecuh, Covington, Dale, Geneva, Henry, 
Houston, Randolph, Russell
Florida: Bay, Calhoun, Franklin, Gadsden, Gulf, Holmes, Jackson, 
Liberty, Okaloosa, Santa Rosa, Walton, Washington
Georgia: Baker, Bibb, Butts, Calhoun, Clay, Clayton, Coweta, 
Crawford, Crisp, Decatur, Dooly, Dougherty, Early, Fayette, Fulton, 
Henry, Houston, Jasper, Jones, Lamar, Lee, Macon, Meriwether, 
Miller, Mitchell, Monroe, Montgomery, Newton, Peach, Pike, Pulaski, 
Quitman, Randolph, Rockdale, Seminole, Spalding, Stewart, Sumter, 
Talbot, Taylor, Terrell, Toombs, Troup, Twiggs, Upson, Webster, 
Wheeler, Wilcox, Worth

    Dated: August 2, 1994.
Eugene A. Ludwig,
Comptroller of the Currency.

    By order of the Board of Governors of the Federal Reserve 
System.

    Dated: July 28, 1994.
William W. Wiles,
Secretary of the Board.

Federal Deposit Insurance Corporation.

    Dated: July 28, 1994.
Robert E. Feldman,
Acting Executive Secretary.

    Dated: July 26, 1994.
    By the Office of Thrift Supervision.

John F. Downey,
Acting Director.

    Dated: July 26, 1994.

Becky Baker,
Secretary of the Board, National Credit Union Administration.
[FR Doc. 94-19259 Filed 8-4-94; 8:45 am]
BILLING CODE OCC 4810-33-P (20%); BOARD 6210-01-P (20%); FDIC 6714-01-P 
(20%); OTS 6720-01-P (20%); NCUA 7535-01-P (20%)