Water no barrier to rural district definition, letter opines

May 2, 2017 -- The presence of a body of water in a geographic area does not preclude the area from satisfying the definition of “contiguous” in the rural district provisions of the NCUA Chartering Manual, according to a recent opinion letter by the agency.

In the letter, NCUA General Counsel Michael J. McKenna addressed the question of whether the agency would consider several Hawaiian Islands contiguous for purposes of NCUA's rural district regulation, despite the islands being separated by a body of water.

“The FCU Act does not define ‘rural district,’ thereby granting NCUA the broad authority to do so as the agency determines is appropriate,” McKenna wrote in the legal opinion letter, dated March 31. “There is nothing in NCUA’s definition of ‘rural district’ to suggest that the presence of a body of water precludes the existence of a rural district. The composition of the subject geographic area is unique, rural in nature, and, despite the body of water, some of the islands are part of the same county,” he wrote.

The NCUA general counsel noted that: a number of metropolitan statistical areas (MSAs) transcend bodies of water; the territorial boundaries of census maps often extend into bodies of water; and rivers and other bodies of water often completely separate metropolitan areas.

“For example, Manhattan and Staten Island are completely separated from each other and other parts of New York City by rivers and bays, yet they are still part of the same city and MSA,” he wrote. “In addition, with respect to Hawaii, OMB designates the Kahului-Wailuku-Lahaina MSA to encompass Kalawao County and Maui County, which are also separated by water.”

He pointed out that these examples support the position that the presence of a body of water in a geographic area does not preclude the area from satisfying the definition of “contiguous” in the rural district provisions of the Chartering Manual.

LINK:
NCUA legal opinion letter 17-0406; Contiguous geographic boundaries