OCC Issues First and Second Quarter 2023 CRA Evaluation Schedule

WASHINGTON — The Office of the Comptroller of the Currency (OCC) today released its schedule of Community Reinvestment Act (CRA) evaluations to be conducted in the first and second quarters of 2023.

The OCC encourages public comment on the national banks and federal savings associations (collectively, banks) scheduled to be evaluated under the CRA. Public comments should be submitted to the banks themselves at the mailing addresses listed on the schedule or to the appropriate OCC supervisory office before the month in which the evaluation is scheduled. The OCC will consider all public comments received before the close of the CRA evaluation.

The CRA evaluation schedule is available on the OCC’s website at: www.occ.gov/static/cra/exam-schedule/craq123.pdf.

Treasury Report Highlights Impact of American Rescue Plan Funding on Tribal Governments

$20 billion in recovery funds is largest single infusion of federal funding into Indian Country

WASHINGTON– Today, the U.S. Department of the Treasury released a report detailing how Tribal governments are using a historic level of financial support through the American Rescue Plan (ARP) to provide critical recovery assistance and improve the health and well-being of Tribal citizens. The $20 billion in ARP State and Local Fiscal Recovery Funds (SLFRF) allocated to Tribal governments represents the largest single infusion of federal funding into Indian Country. The efforts highlighted in today’s report reveal the vast and impressive reach SLFRF has had as a catalyst for recovery.

“Tribal economic development is not reductive—it is additive, as is robust economic development in other underserved communities,” said Chief Lynn Malerba, Treasurer of the United States. “Today’s report shows that State and Local Fiscal Recovery Funds are having direct, deep, and meaningful economic impacts on Tribal nations’ pandemic recovery. By investing in Tribal economies, we are fostering economic prosperity for our nation at large.”

“When Congress appropriated American Rescue Plan funding last year, Treasury made post-pandemic Tribal recovery one of our highest priorities,” said Chief Recovery Officer Jacob Leibenluft. “This historic investment in Tribal communities reflects the commitment Treasury has made to strengthen its relationships with Indian Country and to work to better understand and respond to the needs of Tribal governments.”

In developing Tribal SLFRF policy, Treasury prioritized Tribal engagement and feedback in order to provide Tribal governments with flexibility to meet the unique needs of their citizens. Treasury’s Office of Recovery Program hosted a half-dozen formal Tribal consultations, held over 100 one-on-one sessions with Tribal leaders, and partnered with the White House Council on Native American Affairs and numerous Tribal national and regional organizations to provide direct engagement to maximize the impact of SLFRF funds and increase the likelihood of successful implementation.

To date, Tribal governments have planned or begun implementing over 3,000 projects and services with SLFRF to respond to the pandemic, generating new economic opportunities and improving health, safety, and quality of life for over 2.6 million Tribal citizens. Examples of projects include:

  • The Ketchikan Indian Community provided premium pay to over 190 essential workers with added health risks. Additional pay was awarded in recognition of workers’ resilience, dedication, and dependability, as well as to bolster efforts to retain and support staff.
  • The Menominee Indian Tribe of Wisconsin is implementing a tiny home project for low-income elders, Tribal citizens in transitional living situations, or those facing homelessness. With rising housing costs, the Tribe saw tiny homes as a solution to get people into homes safely, especially during the winter.
  • The Osage Nation is implementing a substantial broadband project to assist in telehealth, distance learning opportunities, affordable internet service, economic growth, and digital inclusion efforts where demands for internet access have grown due to the COVID-19 pandemic.
  • The Douglas Indian Association developed a Tribal Fisherman Grant to assist small business owners who have maintained a historic Tribal presence in the commercial fishing and seafood industry. The grants intend to offset the escalating fuel costs, transportation restrictions, and a decrease in salmon catches to help Tribal citizens economically recover.
  • The Mescalero Apache Tribe is implementing a workforce development program focusing on vocational education. The program will provide scholarships to citizens and current employees to obtain certificates and further education in welding, carpentry, plumbing, electrical, and more – all critical and in-demand jobs to carry out the Tribe’s COVID-19 recovery plan.

Since 2021, Treasury has significantly increased its engagement with Tribes. In her remarks at the 2021 White House Tribal Nations Summit, Secretary Yellen committed to institutionalizing Treasury’s engagement with Tribal Nations and conducting a visit to Tribal lands—commitments which Treasury fulfilled this year. In June, Secretary Yellen and Chief Malerba visited the Rosebud Sioux Tribe in South Dakota, marking the first time a Treasury Secretary visited a Tribal nation. In September, Chief Malerba was sworn in as the first Native American Treasurer at the Treasury Department. In her role, Chief Malerba additionally oversees the newly established Office of Tribal and Native Affairs.

Today’s report comes as the White House hosts the 2022 Tribal Nations Summit at the Department of the Interior. The Summit will feature new Administration announcements and efforts to implement key policy initiatives supporting Tribal communities.

The full report can be viewed here. 

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OCC Revises Civil Money Penalty Manual

WASHINGTON—The Office of the Comptroller of the Currency (OCC) today announced revisions to its civil money penalty (CMP) manual which the agency will begin using on January 1, 2023.

The OCC revised the CMP matrix applicable to its regulated institutions to allow for sufficient differentiation among varying levels of misconduct or by institution size, and updated the mitigating factors to provide a stronger incentive for banks to fully address underlying deficiencies.  

“The revised CMP matrix for OCC institutions will strengthen the effectiveness and fairness of our enforcement actions,” Acting Comptroller Michael J. Hsu said. “It will help ensure that the civil money penalty is tailored to the facts and circumstances of each violation, and the updated mitigating factors will help ensure that the underlying problems are resolved in a timely manner.”  

The CMP matrix is a tool to guide the OCC’s decision making in assessing CMPs. The CMP matrix does not reduce supervisory decision making to a mathematical process and is only intended to be a guide and a starting point for discussion.

The CMP matrix is not a substitute for sound supervisory judgment, and the OCC may depart from the matrix suggestions when appropriate and when based on the specific facts and circumstances of each matter.

The CMP matrix promotes consistency and helps the OCC ensure that all statutory and interagency factors are considered when assessing a CMP.

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Treasury Announces Guidance on Inflation Reduction Act’s Strong Labor Protections

Guidance starts 60-day “clock” for key labor provisions to take effect

WASHINGTON – Today, the Treasury Department announced initial guidance on the Inflation Reduction Act’s strong labor standards that firms must meet to qualify for enhanced clean energy and climate tax incentives. The guidance, which can be read in full here and will be published in the Federal Register tomorrow, is an important first step toward making sure the Inflation Reduction Act supports good-paying jobs in the clean energy industry, expands workforce training pathways into these jobs, and lowers costs for American families.

“The historic Inflation Reduction Act that President Biden signed into law earlier this year puts in place tax incentives across the energy sector that will drive renewable energy investment and economic growth while ensuring the jobs created from this investment and growth are good-paying ones, with strong labor protections,” U.S. Secretary of the Treasury Janet L. Yellen said. “Workers should benefit from the clean energy economy they’re helping build. The guidance announced today provides firms greater clarity on how to meet the labor standards embedded in the bill to maximize the available tax credits.”

The Inflation Reduction Act is the single most significant legislation to combat climate change in our nation’s history, investing a total of $369 billion to help build a clean energy economy. Nearly three-quarters of that climate change investment – an estimated $270 billion – is delivered through tax incentives, putting Treasury at the forefront of this landmark legislation.

To maximize many of the available clean energy and climate tax incentives, firms need to pay workers a “prevailing wage” and employ a certain number of apprentices from registered apprenticeship programs. In the guidance announced today, the Treasury Department provided greater clarity for these provisions.

Both the prevailing wage and apprenticeship requirements apply to the following tax incentives:

  • Advanced Energy Project Credit
  • Alternative Fuel Refueling Property Credit
  • Credit for Carbon Oxide Sequestration
  • Clean Fuel Production Credit
  • Credit for Production of Clean Hydrogen
  • Energy Efficient Commercial Buildings Deduction
  • Renewable Energy Production Tax Credit
  • Renewable Energy Property Investment Tax Credit

The prevailing wage requirements also apply to the following tax incentives:

  • New Energy Efficient Home Credit
  • Zero-Emission Nuclear Power Production Credit

Under the law, these prevailing wage and apprenticeship requirements apply to qualifying facilities, projects, property, or equipment for which construction begins 60 days or more after Treasury publishes guidance. The guidance that will be published in the Federal Register tomorrow begins that 60-day “clock,” meaning that these requirements will apply to qualifying facilities, projects, property, or equipment for which construction begins on or after January 29, 2023.

To further assist taxpayers and other stakeholders in understanding these provisions, the Department of Labor today issued two Frequently Asked Question (FAQ) documents – one on prevailing wage and the other one on apprenticeships.

The Treasury Department plans to issue additional proposed regulations with respect to these requirements in the coming months.
 

WHAT’S IN THE GUIDANCE ANNOUNCED TODAY

Prevailing Wage Guidance

In the guidance announced today, the Treasury Department describes the process for identifying the applicable wage determination for a specific geographic area and job classification on the Department of Labor’s sam.gov website. If no prevailing wage determination is posted for a specific geographic area and/or job classification, Treasury specifies that taxpayers should contact the DOL’s Wage and Hour Division directly via email, and the Division would provide the taxpayer with the labor classifications and wage rates to use.

Apprenticeship Guidance

The guidance provides greater specificity regarding the apprenticeship labor hour, ratio, and participation requirements.  The guidance also describes the good faith effort exception in which a taxpayer makes a good faith effort in requesting qualified apprentices from registered apprenticeship programs.

Recordkeeping Requirements

The guidance also specifies the recordkeeping requirements taxpayers must comply with to substantiate that they paid workers a prevailing wage and satisfied the apprenticeship requirements.

Beginning of Construction Guidance

To provide guidance regarding when the prevailing wage and apprenticeship requirements apply, and provide certainty for taxpayers that are currently constructing clean energy projects, Treasury affirmed the use of longstanding methods for establishing the date of beginning of construction:

  • By starting physical work of a significant nature (physical work test)
  • By having paid or incurred five percent or more of the total cost of the facility (five percent safe harbor)

For both tests, taxpayers must demonstrate either continuous construction or continuous efforts (continuity requirement) for beginning of construction to be satisfied.

Background on Treasury’s work to implement the Inflation Reduction Act:

Since the Inflation Reduction Act was signed into law in August, the Treasury Department has engaged a broad spectrum of labor unions, industry representatives, and other stakeholders to help inform today’s initial guidance. It has reviewed thousands of public comments and hosted a series of roundtable discussions with key stakeholder groups representing millions of workers, thousands of companies, and trillions of dollars in investment assets, as well as climate and environmental justice advocates, community-based organizations, and other key actors that are critical to the success of the IRA.

For more information on Treasury’s stakeholder engagement around the Inflation Reduction Act climate and clean energy provisions, please see: 

August 16, 2022: Treasury Releases Initial Information on Electric Vehicle Tax Credit Under Newly Enacted Inflation Reduction Act

October 5, 2022: Treasury Seeks Public Input on Implementing the Inflation Reduction Act’s Clean Energy Tax Incentives

FACT SHEET: Treasury, IRS Open Public Comment on Implementing the Inflation Reduction Act’s Clean Energy Tax Incentives

October 26, 2022: READOUT: Stakeholder Roundtable on Clean Power Generation and the Inflation Reduction Act

October 27, 2022: READOUT: Stakeholder Roundtable on Climate Impact, Equity, and the Inflation Reduction Act

FACT SHEET: Four ways the Inflation Reduction Act’s Tax Incentives Will Support Building an Equitable Clean Energy Economy

October 31, 2022: READOUT: Stakeholder Roundtable on Investor Perspectives on Climate Change, Clean Energy, and the Inflation Reduction Act

November 3, 2022: Treasury Seeks Public Input on Additional Clean Energy Tax Provisions of the Inflation Reduction Act

November 4, 2022: READOUT: Stakeholder Roundtable on Clean Vehicles and the Inflation Reduction Act

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Treasury Hosts Tribal Consultations on Inflation Reduction Act

WASHINGTON, D.C. –  The U.S. Department of the Treasury today and yesterday hosted Tribal Consultations on the Inflation Reduction Act to hear first-hand from Tribal leaders about provisions in the law that directly affect Tribal nations. More than 200 Tribal leaders and citizens attended.

The consultations are part of Treasury’s ongoing work to solicit input to inform its implementation of the Inflation Reduction Act, the single most significant legislation to combat climate change in our nation’s history. Nearly three quarters of the law’s $369 billion climate change investment – $270 billion – is delivered via tax incentives, putting Treasury at the forefront of this landmark legislation.

The formal consultations also represent Treasury’s broader commitment to robust, meaningful, and regular consultation with Tribal Nations as part of its effort to strengthen relationships with tribes. In June, Secretary of the Treasury Janet L. Yellen became the first Treasury Secretary to visit a Tribal Nation when she visited the Rosebud Sioux Tribe in South Dakota, and in September, Mohegan Chief Lynn Malerba was sworn in as the Treasurer of the U.S., the first Native American to hold that office. The Department also this year established a new Office of Tribal and Native Affairs, which reports to the Treasurer and coordinates Tribal relations throughout the Department.

Specifically, Treasury requested input from Tribal leaders on provisions related to direct payments to Indian Tribal governments for qualifying clean energy projects, the allocation of bonus tax credits for qualifying clean energy projects located on Indian land, and procedures for car dealers to sell vehicles eligible for clean vehicle tax credits to register with the IRS, including car dealers licensed by an Indian Tribal government.

Treasury is also accepting written comments from Tribal leaders at: [email protected].

For more information on Treasury’s stakeholder engagement around the Inflation Reduction Act’s climate and clean energy provisions, please see:

August 16, 2022: Treasury Releases Initial Information on Electric Vehicle Tax Credit Under Newly Enacted Inflation Reduction Act

October 5, 2022: Treasury Seeks Public Input on Implementing the Inflation Reduction Act’s Clean Energy Tax Incentives

FACT SHEET: Treasury, IRS Open Public Comment on Implementing the Inflation Reduction Act’s Clean Energy Tax Incentives

October 26, 2022: READOUT: Stakeholder Roundtable on Clean Power Generation and the Inflation Reduction Act

October 27, 2022: READOUT: Stakeholder Roundtable on Climate Impact, Equity, and the Inflation Reduction Act

FACT SHEET: Four ways the Inflation Reduction Act’s Tax Incentives Will Support Building an Equitable Clean Energy Economy

October 31, 2022: READOUT: Stakeholder Roundtable on Investor Perspectives on Climate Change, Clean Energy, and the Inflation Reduction Act

November 3, 2022: Treasury Seeks Public Input on Additional Clean Energy Tax Provisions of the Inflation Reduction Act

November 4, 2022: READOUT: Stakeholder Roundtable on Clean Vehicles and the Inflation Reduction Act

November 29, 2022: Treasury Announces Guidance on Inflation Reduction Act’s Strong Labor Protections

READOUT: Deputy Secretary Adeyemo Discusses Unlocking Investment Opportunities of the Inflation Reduction Act

LOS ANGELES, CA – On Tuesday, Deputy Secretary of the Treasury Wally Adeyemo participated in a roundtable with clean energy investors and operators to discuss ways the public and private sectors can work together to leverage the Inflation Reduction Act’s historic climate investments to accelerate and build a clean energy economy. According to third-party estimates, the Inflation Reduction Act’s clean energy incentives are projected to catalyze trillions of dollars in private investment in energy supply infrastructure over the next decade. 

The roundtable is part of a series of discussions the Treasury Department has been hosting as it solicits input from the public to inform its work implementing the Inflation Reduction Act. Nearly three quarters of the Inflation Reduction Act’s $369 billion climate change investment – $270 billion – is delivered via tax incentives, putting Treasury at the forefront of this landmark law. 

In the meeting with stakeholders, Deputy Secretary Adeyemo highlighted how the Inflation Reduction Act provides the long-term certainty that investors and businesses have sought for years; strengthens, secures, and diversifies our clean energy supply chains; positions the U.S. to scale existing clean technologies and drive the development of new climate innovations; and provides targeted bonus incentives that will drive investment and create opportunities in communities that are often overlooked. 

Since the Inflation Reduction Act was signed into law in August, the Treasury Department has engaged a broad spectrum of labor unions, industry representatives, investors, and other stakeholders to help inform its implementation of the law. It is reviewing thousands of public comments and has hosted a series of roundtable discussions with key stakeholder groups representing millions of workers, thousands of companies, and trillions of dollars in investment assets, as well as climate and environmental justice advocates, community-based organizations, and other key actors that are critical to the success of the Inflation Reduction Act.

For more information on Treasury’s stakeholder engagement around the Inflation Reduction Act’s climate and clean energy provisions, please see: 

August 16, 2022: Treasury Releases Initial Information on Electric Vehicle Tax Credit Under Newly Enacted Inflation Reduction Act

October 5, 2022: Treasury Seeks Public Input on Implementing the Inflation Reduction Act’s Clean Energy Tax Incentives

FACT SHEET: Treasury, IRS Open Public Comment on Implementing the Inflation Reduction Act’s Clean Energy Tax Incentives

October 26, 2022: READOUT: Stakeholder Roundtable on Clean Power Generation and the Inflation Reduction Act

October 27, 2022: READOUT: Stakeholder Roundtable on Climate Impact, Equity, and the Inflation Reduction Act

FACT SHEET: Four ways the Inflation Reduction Act’s Tax Incentives Will Support Building an Equitable Clean Energy Economy

October 31, 2022: READOUT: Stakeholder Roundtable on Investor Perspectives on Climate Change, Clean Energy, and the Inflation Reduction Act

November 3, 2022: Treasury Seeks Public Input on Additional Clean Energy Tax Provisions of the Inflation Reduction Act

November 4, 2022: READOUT: Stakeholder Roundtable on Clean Vehicles and the Inflation Reduction Act

November 23, 2022: READOUT: Deputy Secretary Adeyemo Roundtable with Labor Leaders on the Inflation Reduction Act

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Treasury Issues Venezuela General License 41 Upon Resumption of Mexico City Talks

WASHINGTON — On November 26th, the Unitary Platform and the Maduro regime announced the resumption of talks in Mexico City; a humanitarian agreement focused on education, health, food security, flood response, and electricity programs that will benefit the Venezuelan people; and agreement on the continuation of talks focused on the 2024 elections. Following this announcement and consistent with U.S. government policy, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued Venezuela General License (GL) 41, authorizing Chevron Corporation to resume limited natural resource extraction operations in Venezuela. This action reflects longstanding U.S. policy to provide targeted sanctions relief based on concrete steps that alleviate the suffering of the Venezuelan people and support the restoration of democracy.

This authorization prevents PdVSA from receiving profits from the oil sales by Chevron. GL 41 authorizes activity related to Chevron’s joint ventures in Venezuela only, and does not authorize other activity with PdVSA. Other Venezuela-related sanctions and restrictions imposed by the United States remain in place; the United States will vigorously enforce these sanctions and will continue to hold accountable any actor that engages in corruption, violates U.S. laws, or abuses human rights in Venezuela. 

GL 41 authorizes transactions ordinarily incident and necessary to certain activities related to the operation and management by Chevron Corporation or its subsidiaries of its joint ventures involving blocked Venezuelan state-owned oil company Petroleos de Venezuela, S.A. (PdVSA) or any entity in which PdVSA owns, directly or indirectly, a 50 percent or greater interest.

The announcements by the Unitary Platform and the Maduro regime are important steps in the right direction to restore democracy in the country. The United States welcomes and supports the reopening of negotiations between the Unitary Platform and the Maduro regime, as part of our longstanding policy to support the peaceful restoration of democracy, free and fair elections, and respect for the rights and freedoms of Venezuelans.

Concurrent with the issuance of Venezuela GL 41, OFAC also issued public guidance indicating that U.S. persons are authorized to provide goods and services for certain activities as specified in GL 41 and that non-U.S. persons generally do not risk U.S. sanctions exposure for facilitating transactions that are authorized by GL 41. In light of Venezuela GL 41, OFAC also extended Venezuela GL 8K and removed Chevron from that license.

Read Venezuela General License 41 and Venezuela General License 8K.

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TSX Delisting Review – Aleafia Health Inc. (AH)

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Acting Comptroller of the Currency Issues Statement on Large Bank Resolution Plans

WASHINGTON—Acting Comptroller of the Currency Michael J. Hsu, in his capacity as a Federal Deposit Insurance Corporation (FDIC) board member, today released the following statement on the FDIC’s review of the eight largest and most complex domestic banking organizations’ 2021 resolution plans.

The collaborative review of the plans by the FDIC and Federal Reserve Board identified areas in which each of the firms should continue to improve its capabilities to facilitate a rapid and orderly resolution. The agencies’ shortcoming determination with regards to Citigroup is consistent with the OCC’s supervisory cease and desist order issued against Citibank, N.A., in October 2020 to require the bank to take broad and comprehensive corrective actions to improve risk management, data governance, and internal controls.

Resolvability is about capabilities, not just passing a paper test. The agencies’ determination regarding Citigroup reflects and reinforces this.

The next Title I review will constitute the first full plan review under the elongated review cycle, which was adopted in 2019. A lot has changed in the intervening period. I will be particularly focused on assessments of firms’ legal entity rationalization and separability capabilities.

Related Links

READOUT: Deputy Secretary Adeyemo Roundtable with Labor Leaders on the Inflation Reduction Act

LOS ANGELES, CA – U.S. Deputy Secretary of the Treasury Wally Adeyemo participated in a roundtable discussion with labor leaders yesterday to discuss Treasury’s implementation of the strong worker provisions included in the Inflation Reduction Act and ways to help ensure workers benefit from the gains created by the transition to a clean energy economy. The roundtable was hosted by the Los Angeles/Orange Counties Building and Construction Trades Council and included leaders from IBEW, Ironworkers, Laborers, Plumbers, Roofers and Waterproofers, and Boilermakers unions.

The roundtable is part of a series of discussions the Treasury Department has been hosting as it solicits input from the public to inform its work implementing the Inflation Reduction Act. Nearly three quarters of the bill’s $369 billion climate change investment – $270 billion – is delivered via tax incentives, putting Treasury at the forefront of this landmark law.

In the meeting with labor leaders, Deputy Secretary Adeyemo discussed how the Inflation Reduction Act will help ensure that workers benefit from the clean energy economy they’re helping build, including through apprenticeship rules that will help expand the union labor force and prevailing wage rules that will help ensure workers receive fair pay.

Since the Inflation Reduction Act was signed into law in August, the Treasury Department has engaged a broad spectrum of labor unions, industry representatives, and other stakeholders to help inform its implementation of the law. It is reviewing thousands of public comments on these provisions and has hosted a series of roundtable discussions with key stakeholder groups representing millions of workers, thousands of companies, and trillions of dollars in investment assets, as well as climate and environmental justice advocates, community-based organizations, and other key actors that are critical to the success of the Inflation Reduction Act.

For more information on Treasury’s stakeholder engagement around the Inflation Reduction Act climate and clean energy provisions, please see:

August 16, 2022: Treasury Releases Initial Information on Electric Vehicle Tax Credit Under Newly Enacted Inflation Reduction Act

October 5, 2022: Treasury Seeks Public Input on Implementing the Inflation Reduction Act’s Clean Energy Tax Incentives

FACT SHEET: Treasury, IRS Open Public Comment on Implementing the Inflation Reduction Act’s Clean Energy Tax Incentives

October 26, 2022: READOUT: Stakeholder Roundtable on Clean Power Generation and the Inflation Reduction Act

October 27, 2022: READOUT: Stakeholder Roundtable on Climate Impact, Equity, and the Inflation Reduction Act

FACT SHEET: Four ways the Inflation Reduction Act’s Tax Incentives Will Support Building an Equitable Clean Energy Economy

October 31, 2022: READOUT: Stakeholder Roundtable on Investor Perspectives on Climate Change, Clean Energy, and the Inflation Reduction Act

November 3, 2022: Treasury Seeks Public Input on Additional Clean Energy Tax Provisions of the Inflation Reduction Act

November 4, 2022: READOUT: Stakeholder Roundtable on Clean Vehicles and the Inflation Reduction Act