We are currently in the process of updating our account opening disclosures. Our old Funds Availability disclosure stated our cut-off time as 2:30, and that has now been changed to 4:00.

Our disclosure also states that check deposits (other than next day items) for New Accounts will be available on the 10th business day. This is a bank policy limit, correct? Not a Regulatory limit?

If we were to change our cut-off time and change the length of the new account hold limit to the 7th business day, would this constitute re-disclosure to our customers?

Each of those changes is favorable to depositors. But they are both policy changes that expedite the availability of funds. Under 229.18(e), you'll need to notify your existing consumer customers of the cutoff hour change within 30 days after implementation. But you only need to update your account disclosures to reflect the change in new accounts holds, since by the time 30 days passes, there won't be anyone to whom it applies who has not already received the disclosure.

How do banks notify their customers? Should we send them a new Funds Availability Disclosure, or just a notice saying "Hey these certain things have changed, make note". ?

You could send out a new disclosure or do a statement message on all demand deposit accounts.

I never even thought of a Statement message! Thanks Duchess, that is a great idea!