WASHINGTON-Credit unions are making preparations to extend credit and make emergency loans to federal workers in the event Congress is unable to resolve its fiscal debate and avert a government shutdown by the end of the Sept. 30 fiscal year, but NCUA would stay open.
NCUA is not expecting any slowdowns or stoppages, even as other federal agencies are preparing to furlough workers. That's because of the credit union regulator's status as an independent agency, which is funded by credit unions, and not through the federal government's budget process. That means examinations would be conducted on time-most examiners work out of their home anyway-and staff will be available for inquiries and assistance.
That's what happened during the last protracted government shutdown in 1995, which NCUA worked through. NCUA has navigated brief government shutdowns several times since then too. The agency's Alexandria offices are owned by NCUA and its adjunct regional offices are leased and would not be affected by a shutdown, according to the agency.
Credit union lobbyists expect any government shutdown to be minimal, if it happens at all, even as Republicans have threatened to not extend the debt ceiling unless Congress agrees to defund Obamacare. "If it there is a shutdown, it will be a short one," said Ryan Donovan, senior lobbyist for CUNA.
Meantime, credit unions serving government employees are preparing their exigency strategies. Navy FCU, for example, pledged last week to cover billions of dollars in member pay scheduled to be direct deposited Oct. 15, even if the government stops paying its bills. (See related story on page 1)
"Our No. 1 concern is our members and their families. That's why we're pledging to cover the direct deposits for our active duty members," said Cutler Dawson, president of the world's biggest credit union. "By covering their 15 October pay, our active duty members will not see a difference in their direct deposit amount-as if there were no shutdown."
Service CU said it will credit direct deposit and allotments for military and government service members affected by the possible government shutdown and will provide a 0% loan rate up to $6,000 with up to a 30-day payback and a line of credit up to their direct deposit for all other government paid members.
Marine FCU said it will also post government employee payrolls for members with direct deposit. This includes active duty and retired military, Department of Defense appropriated and non-appropriated, social security, and disability.
Dozens of other credit unions serving federal workers are also making contingency plans, most of them offering short-term loans in case their pay is delayed.
