NCUA, UNION RENEGOTIATE,
EXAMINERS' PAY CONTRACT
WASHINGTON-NCUA has negotiated a new contract with its union that will freeze pay for examiners and other members of the bargaining unit of the National Treasury Employees Union in exchange for increases in benefits.
Pay for the agency's 842 union workers raised the ire of many in the credit union industry last year because union members were scheduled to receive average pay hikes of 6.1% in the final year of a three-year contract, while the rest of government workers had their pay frozen for two years under a Presidential directive.
The contract, which will take effect Nov. 1, covers most of the approximately 1,100 NCUA employees, the vast majority of which are examiners.
Under the new contract, beginning in 2012, NCUA salaries and median locality payments will increase by the same percentage the general schedule for the federal government employees pay scales increase. If the government-wide pay freeze is extended beyond 2012, NCUA's freeze will also continue. (As an independent agency, NCUA does not always follow government pay schedules.)
The new contract will create a new 401(k) program, in addition to the standard Thrift Savings Plan NCUA employees already participate in, which the agency will fund at 3%. The agency will also provide some reimbursement to help employees pay their medical, dental and vision premiums.
For insurance contributions, the contract provides for an additional of $90 per pay period for each employee enrolled in health, dental and vision insurance programs.
Other provisions in the new deal address issues that are important to a federal employee's work life, including telework, the merit promotion notification process and performance-evaluations procedures. NTEU believes that these adjustments will allow NCUA to remain competitive in the retention and recruitment of the talented personnel it needs.
"Considering the financial challenges that the federal government and its employees are facing, NTEU believes that this agreement properly safeguards the interests of the NCUA, its mission and its most valuable asset: its employees," said Colleen Kelley, president of the union.
APPEAL SEEKS NCUA REDRESS
FOR UNINSURED DEPOSITORS
NEW HAVEN, Conn.-A group of members of New London Security FCU are appealing the dismissal of their suit claiming NCUA is responsible for $4 million in uninsured deposits they lost from the 2008 failure of the $13-million credit union.
The members claim NCUA is responsible for all of their losses because its examiners failed for more than a decade to spot a fraud by the credit union's elderly investment manager who was also a director, wiping out $12 million of the credit union's assets. The 82-year-old investment manager, Edwin Rachleff, leaped to his death from the 11th floor of a nearby building just hours after NCUA shut the 72-year-old credit union, chartered to serve local Jewish affinity groups.
In their suit, Melvin Goldblatt, Joan Lazerow, Mark Fetcher, Gloria Johnston and Douglas Antupit claim NCUA is responsible for their losses because its examiners ignored signs of the fraud and failed to conduct on-site reviews for years at a time. The lower court, however, dismissed their suit, because they failed by three weeks to file their claim within the legally allotted time frame.
NCUA paid out almost $10 million to New London Security members but denied claims for anything over $100,000 per account, which was the legal limit on federal deposit insurance coverage at the time. The limit has since been increased to $250,000 per account.
An internal report issued by NCUA's Inspector General found that had the agency taken stronger supervisory actions it might have uncovered the fraud sooner and mitigated the final losses.
The member group filed their appeal earlier this month with the U.S. Court of Appeals for the Second Circuit.
COMMUNITY DEVELOPMENT
LOAN FUND LOSES FAVOR
ALEXANDRIA, Va.-NCUA reported that demand has completely dried up for loans from its community development revolving loan fund, with no loans made from the $17.5-million fund since May 2010, and almost $14 million in available funds going untapped.
At Sept. 30, the fund was holding $6.5 million in cash and cash equivalents and $7.5 million in U.S. Treasury securities, with just $3.5 million in loans outstanding.
The dearth of lending comes as NCUA is seeking to broaden eligibility for the fund beyond the 1,100 credit unions the agency has qualified as low-income.
The fund is expected to make more than $1 million in small technical assistance grants for 2011.
The fund's cash horde is an all-time high and 1% loans are at a low since creation of the fund in 1979.
