Thursday, July 6, 2017

Black Hills FCU's Gerrymandered Rural District Charter

Black Hills Federal Credit Union (Rapid City, SD) is using the rural district loophole to connect South Dakota's two largest distinct metropolitan areas by population size. One metropolitan area is in the eastern part of the state and the other is in the western part of the state.

The credit union has used the rural district geographic common-bond to expand its footprint across the state on three different occasions.

In March 2011, the National Credit Union Administration (NCUA) granted Black Hill'a rural district community charter serving the South Dakota counties of Pennington, Meade, Haakon, Hughes, or Stanley.

In July 2015, NCUA approved a second expansion of Black Hills' rural district adding the counties of Butte, Buffalo, Hyde, Jerauld, Lincoln, McCook, Miner, Sanborn, Sully, or Turner.

In May 2017, NCUA approved an expansion of a rural district community common-bond for Black Hills Federal Credit Union (Rapid City, SD) to include Minnehaha County, the state's most populous county.

The addition of Minnehaha County raised the potential population for this rural district to 431,701, as Black Hills FCU exploits NCUA's recently amended field of membership final rule that raised the population threshold for a rural district from 250,000 to 1 million.

This rural district snakes its way across South Dakota from the Montana-Wyoming border to the Minnesota-Iowa border.

This rural district includes three core-based statistical areas -- two metropolitan statistical areas and a micropolitan statistical area.

Each of these core-based statistical areas are distinct well-defined local communities.

Almost 95 percent of the people living in this rural district reside in the three core-based statistical areas.

It appears that the credit union is using rural counties to create a bridge from one metro area to another metro area.

In fact, Black Hills FCU does not have a branch in truly rural counties, such as Haakon, Buffalo, Butte, Jerauld, Hyde, Miner, and Sanborn. However, according to its current profile, the credit union has already opened a branch in Minnehaha County, which it just added.

This gerrymandered rural district is rural in name only. NCUA's decision to approve this rural district is arbitrary and capricious.


  1. It most certainly is.

  2. I switched to my credit union from a local bank because the bank spent more time, money, and resources complaining about credit unions than it did trying to provide the best products and services. Also, I miss your point on the credit union not having branches in "truly rural counties." It's 2017, brick and mortar branches are becoming a thing of the past. With your argument, it seems as if you are more so just complaining about the competition. Not much here of substance.



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