On Deadline: NCUA Rejects Bid For Residential Development
NCUA denied a credit union's request to convert excess credit union property into residential housing it planned to rent to its employees. In a new legal opinion letter, NCUA ruled federal credit unions have neither express authority nor is it within their incidental powers to engage in this. The unnamed credit union told NCUA it would like to offer residential housing to its employees due to high real estate prices in its area. Under the plan, the CU would have developed its own excess property by converting it into residential rental units, then lease units to employees and charge below market rates. But NCUA rejected the idea, saying, "an FCU may only engage in activities that the FCU Act expressly authorizes or that fall within an FCU's incidental powers."