On June 17, 2021, President Biden signed into law Senate Bill 475 (S. 475) making “Juneteenth” a federal holiday. Because June 19th falls on a Saturday this year, the day will be observed by federal government offices on June 18, 2021. S. 475 amends section 6103(a) of title 5 of the United States Code by inserting after the item relating to Memorial Day the following:
“Juneteenth National Independence Day, June 19.”
June 19th is significant because, on June 19, 1865, Major General Gordon Granger announced in Galveston, Texas, the end of slavery in accordance with President Abraham Lincoln’s 1863 Emancipation Proclamation. Forty-eight states and the District of Columbia already recognize Juneteenth as a holiday.
This new law, revising the list of federal holidays in the U.S. Code, will affect consumer credit lenders’ operations. Lenders should review their processes to determine how this new holiday will impact their operations. Please find more details below.
TILA and Regulation Z recognize two different definitions of “business day.” There are “general business days” and “specific business days,” and these business day definitions are applied differently with respect to certain requirements.
“General business days” are defined to mean a day on which the creditor’s offices are open to the public for carrying on substantially all of its business functions. 12 C.F.R. § 1026.2(a)(6). Note that this definition specifically refers to offices being open to the public, and not offices such as backroom type operations that are not open to the public. The Commentary to Regulation Z notes that activities that indicate that the creditor is open for substantially all of its business functions include the availability of personnel to make loan disbursements and to handle credit transaction inquiries. Comment 1 to § 1026.2(a)(6).
“Specific business days,” on the other hand, are defined to mean all calendar days except Sundays and the legal public holidays specified in 5 U.S.C. § 6103(a), which include New Year’s Day, the Birthday of Martin Luther King, Jr., Washington’s Birthday, Memorial Day, Independence Day, Labor Day, Columbus Day, Veterans Day, Thanksgiving Day, and Christmas Day; and now “Juneteenth”. 12 C.F.R. § 1026.2(a)(6). The Commentary to Regulation Z states that when one of the Federal legal holidays specified in 5 U.S.C. § 6103(a) (July 4, for example) falls on a Saturday, Federal offices and other entities might observe the holiday on the preceding Friday (July 3). In cases where the more precise rule applies (e.g., rescission, waiting periods before consummation), the observed holiday (in the example, July 3) is a business day, but the actual holiday (July 4) will not be a business day.
Now, with the enactment of S. 475, Juneteenth is a federal holiday. However, while the holiday is being observed on Friday, June 18th this year (due to June 19th falling on a Saturday), Saturday will be the actual holiday. For the more precise purposes (e.g., rescission, waiting periods prior to consummation), Friday is a business day and Saturday is not, meaning that in certain situations, the company may need to add one more business day (e.g., rescission may need to remain open for a day longer, or consummation may need to be scheduled a day later) than originally required for these purposes. For the general business day purposes, whether Friday and Saturday are business days depends on whether the company’s offices are open to the public for carrying on substantially all of its business functions.