The National Credit Union Administration unanimously approved its total budget for 2022-23 after making significant changes to how it funds its operations.
At the NCUA’s monthly board meeting, agency officials discussed the feedback garnered at a budget briefing earlier this month from various trade organizations and the public and reviewed how that feedback shaped its budget.
Ann Kossachev, vice president of regulatory affairs for the National Association of Federally-Insured Credit Unions, expressed concern about the total allocations for travel and the addition of new full-time roles prior to the budget’s passing.
“The pandemic is still a part of life, and we can't assume that things are going to go back to prepandemic travel levels anytime soon, certainly not in the next few months … so why budget for all of these travel expenses when it's still very much an uncertain situation?” Kossachev said.
Other organizations like the Credit Union National Association expressed similar concerns regarding the expenses originally allocated for agency commuting.
“We were anticipating less travel because [the NCUA] would have more technology and the ability for the agency to do more of their work remotely … that was the picture that was painted for us and what this budget reflects is the exact opposite,” said Mike Schenk, chief economist at CUNA.
Differences between the agreed upon operating budget and its draft version include a decrease of 46 full time equivalent positions and a reduction in travel expenses by $2.7 million.
In addition, a suggestion made by NCUA board member Rodney Hood to institute a $15 million rebate in the operating fee collected from federal credit unions was included in the approved budget, lowering the amount assessed on a per-institution basis.
Kyle Hauptman, vice chairman of the NCUA board, said the purpose of the annual operating fee is for covering the agency’s yearly expenses, rather than to amass a reserve of funds.
“We all appreciate the effort to conserve budget dollars, but we should work toward a consistent method for returning excess funds when they reach certain levels…returning $15 million of the excess cash to offset the operating budget is a step in the right direction,” Hauptman said.
Considering the capital expenditures and National Credit Union Share Insurance Fund administrative budgets remaining consistent with their originally proposed versions, the final approved budget for 2022 stands at roughly $340 million with 1,196 full-time- equivalent positions, and approximately $381 million with 1,204 full-time-equivalent positions for 2023.
