Regulator increases budget 3.3%, to $91.9 million, and cuts 18 jobs.

The National Credit Union Administration approved a $91.9 million budget for fiscal year 1994, representing a 3.3% increase from the prior year.

The budget, however, contains the agency's first staff cuts since 1985. The cuts bring the number of NCUA staff to 978.

"That reduction was made possible by a decline in the number of problem-case credit unions and a decline in the shares held by those credit unions," said Herbert Yolles, the regulatory agency's controller.

Driving Factors

Several factors drove the agency's budget increase. They were:

* Annual merit pay adjustments, due to take place in December, will increase by 2.3% to $1.4 million.

* Employee benefit costs will increase by about $1 million.

* The agency's new headquarters building in Alexandria, Va., will add $1.1 million to the 1994 budget over 1993 rental costs, but is $1.6 million less than continued leasing at the current downtown location would have been.

* Three planned regional conferences will increase the budget by an estimated $1 million.

To hold down the budget increase, the regulatory agency's board of directors agreed to cut 18 positions.

Ken Robinson, president of the National Association of Federal Credit Unions was glad to see the belt tightening.

|Deliberate Staff Decline'

"I want to see a deliberate decline in the staff that parallels the decline in number of credit unions," he said. "Otherwise we're going to wind up with one big credit union west of the Mississippi, one big credit union east of the Mississippi, and about 600 examiners."

Charles Zuver, executive vice president of Credit Union National Association Governmental Affairs, criticized the budget in a statement. He said the NCUA's figures actually represent a 9% increase because the agency will come in under budget by three to 5%.

Mr. Zuver's comparison is "not valid," Mr. Yolles said.

"It's mixing apples and oranges," he said. "Either you have to compare budgets to budgets or expenditures to expenditures."

NCUA will finish the year between 3% to 5% under budget, largely due to long lapses in filling vacant positions, he said.

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