il-v50i41-38-ill-adm-code-185: 38 Ill. Adm. Code 185 — Credit Union Community Reinvestment

1) Heading of the Part: Credit Union Community Reinvestment 2) Code Citation: 38 Ill. Adm. Code 185 3) Section Numbers: Proposed Actions: 185.200 Amendment 185.420 Amendment 185.430 Amendment 185.APPENDIX B Amendment 4) Statutory Authority: Implementing and authorized by the Illinois Community Reinvestment Act [205 ILCS 735]. 5) A Complete Description of the Subjects and Issues Involved: These new amendments would provide clarity by replacing references to "communities" or "local communities" in Section 185.200 with "assessment field", by fixing a typographical issue in Section 185.420 and providing technical updates regarding when a consumer loan must be kept in the ILCRA file, and by updating Sections 185.430 and 185.APPENDIX B to remove language inapplicable to credit unions. 6) Published studies or reports, and sources of underlying data, used to compose this rulemaking: None 7) Will this proposed rulemaking replace an emergency rule currently in effect? No 8) Does this rulemaking contain an automatic repeal date? No 9) Does this proposed rulemaking contain incorporations by reference? No 10) Are there any other proposed rulemakings pending on this Part? No 11) Statement of Statewide Policy Objectives: This rulemaking will not require a local government to establish, expand, or modify its activities in such a way as to necessitate additional expenditures from local revenues. 12) Time, Place, and Manner in which interested persons may comment on this proposed rulemaking: Department of Financial and Professional Regulation Attention: Craig Cellini 320 West Washington, 2 Floor Springfield, IL 62786 (217) 785-0810 Fax: (217)557-4451 Craig.Cellini@illinois.gov All written comments received within 45 days after this issue of the Illinois Register will be considered. 13) Initial Regulatory Flexibility Analysis: A) Description of the type of small business, not for profit corporations or small municipalities subject to the proposed amendments: Notwithstanding the definitional distinctions between "small business" and "not for profit corporation" and a credit union, the Department strove to minimize financial and operational burdens for all credit unions, and in particular credit unions with fewer total assets whenever possible, provided it was consistent with the statutory objectives of the ILCRA. B) Description of the proposed reporting, bookkeeping and other procedures required for compliance with the amendments: None C) Description of the types of professional skills necessary for compliance: None other than those already required for compliance with the existing rules. 14) Small Business Economic Impact Analysis: Determine whether the rulemaking has an adverse impact on small business (fewer than 50 full-time employees or less than $4,000,000 in gross annual sales). An adverse impact is one that can be reasonably foreseen on small businesses including, but not limited to, a loss of customers, loss of revenue, or increased business expenses. If the proposed amendments have an adverse impact on small business, the agency must provide an economic impact analysis including: A) Types of businesses subject to the proposed amendments: 52 Finance and Insurance DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION NOTICE OF PROPOSED AMENDMENTS B) Estimated number of small business subject to the proposed amendments: There are currently 151 credit unions incorporated under the Illinois Credit Union Act in total. All Illinois state-chartered credit unions are cooperatives, non-profit associations, incorporated under the Illinois Credit Union Act. The Illinois Credit Union Act does not distinguish between credit unions based on number of employees or gross annual sales but regulatory fees for credit unions are calculated based on total asset size. Credit unions are financial institutions and generally do not have "gross annual sales." The Department does not track how many full-time employees Illinois chartered credit unions have, but on information and belief most Illinois state-chartered credit unions have less than 50 employees. C) Categories that the agency reasonably believes the rulemaking will impact, including: ii. regulatory requirements; D) Projected reporting, recordkeeping and other administrative costs for compliance with the proposed amendments: None E) Type of professional skills necessary for preparation of any report or record required for compliance with the proposed amendments: No expected additional skills needed. The proposed amendments modify current Illinois Community Reinvestment Act rules, so credit unions should already have most compliance systems in place. F) Statement of the probable positive or negative economic effect on small business: The proposed amendments will likely have a neutral effect on small businesses, as they would simply provide clarity within the existing framework of the rules. G) Description of any less intrusive or costly alternative methods of achieving the purposes of the amendments: None 15) Regulatory Agenda on which this rulemaking was summarized: None 16) Any other information or justification for the proposed rule or amendment that the agency believes would be helpful to the public regarding the proposed rule or amendment. For example, a discussion or analysis of the benefits of the proposed rule or DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION NOTICE OF PROPOSED AMENDMENTS amendment is projected to have on the Illinois public, consumers, investors or other similar groups. None The full text of the Proposed Amendments begins on the next page: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION NOTICE OF PROPOSED AMENDMENTS TITLE 38: FINANCIAL INSTITUTIONS CHAPTER II: DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION PART 185 CREDIT UNION COMMUNITY REINVESTMENT SUBPART A: GENERAL Section 185.10 Authority, Purposes and Scope 185.20 Definitions SUBPART B: STANDARDS OF ASSESSING PERFORMANCE Section 185.200 Assessment Factors 185.210 Performance Tests, Standards, and Ratings, In General 185.220 Lending Test 185.230 Investment Test 185.240 Service Test 185.250 Community Development Test for Wholesale or Limited Purpose Credit Unions 185.260 Small Credit Union and Intermediate Small Credit Union Performance Standards 185.270 Strategic Plan 185.280 Assigned Ratings 185.290 Effect of ILCRA Performance on Applications SUBPART C: RECORDS, REPORTING, AND DISCLOSURE REQUIREMENTS; EXAMINATIONS; ENFORCEMENT Section 185.400 Assessment Field Delineation 185.410 Data Collection, Reporting, and Disclosure 185.420 Content and Availability of ILCRA File 185.430 Public Notice by Credit Union 185.440 Publication of Planned Examination Schedule 185.450 Very Small Credit Union Examination Procedures 185.460 Examination Authority and Cooperation 185.470 Examination Schedule 185.480 Examination Fees DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION NOTICE OF PROPOSED AMENDMENTS 185.490 Implementation Period 185.500 Enforcement 185.510 Provisions for Granting of Variance from Rules 185.APPENDIX A Ratings 185.APPENDIX B ILCRA Notice 185.APPENDIX C Examples of Community Development 185.APPENDIX D Very Small Credit Union Examination Procedures 185.APPENDIX E ILCRA Illustrative List of Qualifying Activities for Credit Unions AUTHORITY: Implementing and authorized by the Illinois Community Reinvestment Act [205 ILCS 735]. SOURCE: Adopted at 48 Ill. Reg. 7004, effective May 1, 2024; expedited correction at 48 Ill. Reg. 13864, effective May 1, 2024; amended at 50 Ill. Reg. 9208, effective June 29, 2026; amended at 50 Ill. Reg. ______, effective ____________. SUBPART B: STANDARDS OF ASSESSING PERFORMANCE Section 185.200 Assessment Factors a) As used in this Part, "assessment factors" means the assessment of the following factors to determine whether a credit union is meeting the financial services needs of its assessment fieldlocal communities: 1) activities to ascertain the financial services needs of the assessment fieldcommunity, including communication with community members in the assessment field regarding the financial services provided; 2) extent of marketing to make members in the assessment fieldof the community aware of the financial services offered; 3) origination of mortgage loans including, but not limited to, home improvement and rehabilitation loans, and other efforts to assist existing low-income and moderate-income residents to be able to remain in affordable housing in their neighborhoods; 4) for small business lenders, the origination of loans to businesses with gross annual revenues of $1,000,000.00 or less, particularly those in low- income and moderate-income neighborhoods; 5) participation, including investments, in community development and redevelopment programs, small business technical assistance programs, minority-owned depository institutions, community development financial institutions, and mutually-owned financial institutions; 6) efforts working with delinquent customers to facilitate a resolution of the delinquency; 7) origination of loans that show an under concentration and a systemic pattern of lending resulting in the loss of affordable housing units; 8) evidence of discriminatory and prohibited practices; and 9) offering retail banking services to unbanked and underbanked persons. b) In applying these factors, the Secretary shall account for a credit union's field of membership and any lending, investment, and other limitation or prohibition applicable to the credit union pursuant to law. (Source: Amended at 50 Ill. Reg. ______, effective ____________) SUBPART C: RECORDS, REPORTING, AND DISCLOSURE REQUIREMENTS; EXAMINATIONS; ENFORCEMENT Section 185.420 Content and Availability of ILCRA File a) Information available to the field of membership. A credit union shall maintain an ILCRA file for its field of membership that includes the following information: 1) all written comments received from the public for the current year and each of the prior two calendar years that specifically relate to the credit union's performance in helping to meet community credit needs, and any response to the comments by the credit union, if neither the comments nor the responses contain statements that reflect adversely on the good name DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION NOTICE OF PROPOSED AMENDMENTS or reputation of any persons other than the credit union or publication of which would violate specific provisions of law. 2) a copy of the public section of the credit union's most recent ILCRA Performance Evaluation prepared by the Secretary. The credit union shall place this copy in the ILCRA file within 30 business days after its receipt from the Secretary. A copy of the public section includes: A) The assessment factors utilized to determine the credit union's descriptive rating; B) The Secretary's conclusion with respect to each assessment factor; C) A discussion of the facts supporting the conclusions; D) The credit union's descriptive rating and the basis therefor; E) The assigned overall rating; F) Any other information the Secretary finds that the ends of justice and the public advantage will be served by the disclosure; and G) A summary of public comments. 3) a list of the credit union's branches, their street addresses, and geographies; 4) a list of branches opened or closed by the credit union during the current year and each of the prior two calendar years, their street addresses, and geographies; 5) a list of services (including hours of operation, available loan and deposit products, and transaction fees) generally offered at the credit union's branches and descriptions of material differences in the availability or cost of services at particular branches, if any. At its option, a credit union may include information regarding the availability of alternative systems for delivering retail banking services (e.g., ATMs, ATMs not owned or operated by or exclusively for the credit union, banking by telephone or DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION NOTICE OF PROPOSED AMENDMENTS computer, loan production offices, bank-at-work or bank-by-mail programs); 6) the field of membership as defined in the credit union's Article of Incorporation and Article III of the bylaws; 7) its assessment field delineation; and 8) any other information the credit union chooses. b) Additional information available to the field of membership. 1) Credit Unions other than small credit unions or intermediate small credit unions. A credit union, except a small credit union or intermediate small credit union or a credit union or a credit union that was a small credit union or intermediate small credit union the prior calendar year, shall include in its ILCRA file the following information pertaining to the credit union and its affiliates, if applicable, for each of the prior two calendar years, but only if. If the credit union has elected to have one or more categories of its consumer loans considered under the lending test, for each of these categories, the number and amount of loans: A) to low-, moderate-, middle-, and upper-income individuals; B) located in low-, moderate-, middle-, and upper-income census tracts; and C) located inside the credit union's assessment field and outside the credit union's assessment field. 2) Credit Union required to report Home Mortgage Disclosure Act (HMDA) data. A credit union required to report home mortgage loan data pursuant 12 CFR Part 1003 (Home Disclosure Data) shall include in its ILCRA file a written notice that the institution's HMDA Disclosure Statement may be obtained on the Consumer Financial Protection Bureau's (Bureau's) Website at www.consumerfinance.gov/hmda. In addition, a credit union that elected to have the Secretary consider the mortgage lending of an affiliate for any of these years shall include in its ILCRA file the affiliate's HMDA Disclosure Statement for those years. The credit union shall place DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION NOTICE OF PROPOSED AMENDMENTS the statements in the ILCRA file within three business days after its receipt. 3) Small credit unions and intermediate small credit unions. A small credit union or intermediate small credit union or a credit union that was a small credit union or intermediate small credit union during the prior calendar year shall include in its ILCRA file the credit union's loan-to-share ratio by asset class for each quarter of the prior calendar year and, at its option, additional data on its loan-to-share ratio. 4) Credit unions with strategic plans. A credit union that has been approved to be assessed under a strategic plan shall include in its ILCRA file a copy of that plan. A credit union need not include information submitted to the Secretary on a confidential basis in conjunction with the plan. 5) Credit unions with less than satisfactory ratings. A credit union that received a less than satisfactory rating during its most recent examination shall include in its ILCRA file a description of its current efforts to improve its performance in helping to meet the credit needs of its entire community. The credit union shall update the description quarterly. c) Location of information. A credit union shall make available to the field of membership for inspection upon request and at no cost the information required in this Section as follows: 1) at the main office and, if an interstate credit union, at one branch office in each state, all information in the ILCRA file; and 2) at each branch, if any: A) a copy of the public section of the credit union's most recent ILCRA Performance Evaluation and a list of services provided by the branch; and B) within five calendar days after the request, all the information in the ILCRA file relating to the assessment field in which the branch is located. DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION NOTICE OF PROPOSED AMENDMENTS d) Copies. Upon request, a credit union shall provide copies, on paper, electronically, or in another form acceptable to the person making the request, of the information in its ILCRA file. The credit union may charge a reasonable fee not to exceed the cost of copying and mailing, if applicable. A credit union shall not charge a fee if the information is only provided electronically. e) Updating. Except as otherwise provided in this Section, a credit union shall ensure that the information required by this Section is current as of April 1 of each year. f) Notwithstanding subsections (a) through (e), this Section does not prohibit a credit union from establishing and implementing standards and procedures that a person must follow to obtain the ILCRA file. The standards and procedures shall provide reasonable access to the ILCRA file. In determining whether standards and procedures are reasonable, the Secretary shall consider: 1) The credit union's size and financial condition; 2) The location of the credit union and its hours of operation; 3) Whether the ILCRA file is available electronically; and 4) Any other unique circumstances presented by the credit union. g) A credit union may request a written finding from the Secretary that its standards and procedures provide reasonable access to the file from the Secretary. Any credit union which relies on a finding shall not be subject to an enforcement action by the Department for a violation of this Section. Unless extended by the Secretary in writing, any finding shall expire at the end of the credit union's next examination. h) The Department shall make the public section of the written evaluation available to all persons for inspection or copying pursuant to Section 35-15(b) of the ILCRA. Public comments, together with any response from a credit union will be considered by the Secretary in evaluating our ILCRA performance and may be made public. (Source: Amended at 50 Ill. Reg. ______, effective ____________) Section 185.430 Public Notice by Credit Union A credit union shall provide in the public lobby of its main office and each of its branches, if any, and on its website, the appropriate public notice set forth in 185.APPENDIX B. Each required notice shall also be posted on the credit union's website.Only a branch of a credit union having more than one assessment field shall include the bracketed material in the notice for branch offices. Only a credit union that is an affiliate of a holding company shall include the second to the last sentence of the notices. A credit union shall include the last sentence of the notices only if it is an affiliate of a holding company that is not prevented by statute from acquiring additional credit unions. (Source: Amended at 50 Ill. Reg. ______, effective ____________) Section 185.APPENDIX B ILCRA Notice a) Notice for main office. A credit union shall prominently display the following notice at its main office and on its website. ILLINOIS COMMUNITY REINVESTMENT ACT NOTICE Under the Illinois Community Reinvestment Act (ILCRA), the Secretary of the Department of Financial and Professional Regulation (Secretary) evaluates our record of helping to meet the credit needs of this community consistent with safe and sound operations, and consistent with our common bond. The Secretary also takes this record into account when deciding on certain applications submitted by us. Your involvement is encouraged. Members and persons eligible to join our credit union are entitled to certain information about our operations and our performance under the ILCRA, including, for example, information about our branches, such as their location and services provided at them; the public section of our most recent ILCRA Performance Evaluation, prepared by the Secretary; and comments received from the public relating to our performance in helping to meet community credit needs, as well as our responses to those comments. You may review this information today. At least 30 days before the beginning of each quarter, the Secretary publishes a list of the credit unions that are scheduled for ILCRA examination by the Secretary in that quarter. This list is available from the Secretary at 320 West Washington Street, 3 Floor Springfield, IL 62786 and 555 W. Monroe St., Suite 500, Chicago, IL 60661. You may send written comments about our performance in helping to meet community credit needs to (name and address of official at credit rd union) and to the Secretary at 320 West Washington Street, 3 Floor Springfield, IL 62786 and 555 W. Monroe St., Suite 500, Chicago, IL 60661 or electronically at https://idfpr.illinois.gov/admin/cra.html. Your letter, together with any response by us, will be considered by the Secretary in evaluating our ILCRA performance and may be made public. You may ask to look at any comments received by the Secretary. You may also request from the Secretary an announcement of our applications covered by the ILCRA filed with the Secretary. [We are an affiliate of (name of holding company), a bank holding company]. b) Notice for branch offices. A credit union shall prominently display the following notice at all branch offices and on its website. DEPARTMENT OF FINANCIAL AND PROFESSIONAL REGULATION NOTICE OF PROPOSED AMENDMENTS ILLINOIS COMMUNITY REINVESTMENT ACT NOTICE Under the Illinois Community Reinvestment Act (ILCRA), the Secretary of the Department of Financial and Professional Regulation (Secretary) evaluates our record of helping to meet the credit needs of this community consistent with safe and sound operations. The Secretary also takes this record into account when deciding on certain applications submitted by us. Your involvement is encouraged. Members and persons eligible to join our credit union are entitled to certain information about our operations and our performance under the ILCRA. You may review today the public section of our most recent ILCRA evaluation, prepared by Secretary, and a list of services provided at this branch. You may also have access to the following additional information, which we will make available to you at this branch within five calendar days after you make a request to us: 1) a map showing the assessment area containing this branch, which is the field in which the Secretary evaluates our ILCRA performance in this community or other documentation showing the assessment field; 2) information about our branches in this assessment field; 3) a list of services we provide at those locations; 4) data on our lending performance in this assessment field; and 5) copies of all written comments received by us that specifically relate to our ILCRA performance in this assessment field, and any responses we have made to those comments. If we are operating under an approved strategic plan, you may also have access to a copy of the plan. If you would like to review information about our ILCRA performance in other communities served by us, the ILCRA file for our entire credit union is available at (name of office located in state), located at (address). At least 30 days before the beginning of each quarter, the Secretary publishes a list of the credit unions that are scheduled for ILCRA examination by the Secretary in that quarter. This list is rd available from the Secretary at 320 West Washington Street, 3 Floor Springfield, IL 62786 and 555 W. Monroe St., Suite 500, Chicago, IL 60661. You may send written comments about our performance in helping to meet community credit needs to (name and address of official at credit union) and to the Secretary at 320 West Washington Street, 3 Floor Springfield, IL 62786 and 555 W. Monroe St., Suite 500, Chicago, IL 60661 or electronically at https://idfpr.illinois.gov/admin/cra.html. Your letter, together with any response by us, will be considered by the Secretary in evaluating our ILCRA performance and may be made public. You may ask to look at any comments received by the Secretary. You may also request from the Secretary an announcement of our applications covered by the ILCRA filed with the Secretary. (We are an affiliate of (name of holding company), a holding company. You may request from (title of responsible official), Federal Reserve Bank of _______ (address) an announcement of applications covered by the ILCRA filed by holding companies.) c) The Secretary may update the address or web address to be included on the required notices by posting a notice of the change of address to the Department's website at least 30 days prior to the change. (Source: Amended at 50 Ill. Reg. ______, effective ____________) ILLINOIS GUARDIANSHIP AND ADVOCACY COMMISSION NOTICE OF PROPOSED AMENDMENT