WASHINGTON (11/16/12)--The Credit Union National Association (CUNA) is outraged by the National Credit Union Administration's (NCUA) planned 2013 spending increase, and will be pursuing this with other policymakers to achieve greater accountability and transparency in the agency's budgetary process, CUNA President/CEO Bill Cheney said Thursday.
NCUA Chairman Debbie Matz, center, said the NCUA is "committed to running the agency as efficiently as possible," and called the NCUA"s yearly budgets sound investments for credit unions. (CUNA Photo)
The NCUA approved a 2013 budget of $251.4 million. This spending plan represents an increase of 6.1% from 2012's NCUA budget. The NCUA noted that this 6.1% increase is a lower rate than the projected 6.5% increase in credit union industry assets.
The total amount of 2013 funding increase is $14.5 million, and $12.8 million of this increase would go to possible staff pay increases, employee benefits, locality pay, and full funding for full-time employees (FTEs) that were only partially funded in 2012, according to the NCUA.
The agency noted that this number could change if Congress does not approve a federal employee pay increase for next year.
The NCUA also plans to add $150,000 in new administrative expenses, an increase in contract service expenses of about $980,000 and $800,000 in new travel expenses.
Employee pay and benefits account for 73%, or $183.6 million, of the 2013 budget, which does not call for any changes in the number of FTEs.
"This is a realistic, responsible and prudent budget. It's a sound investment for credit unions to protect their bottom lines and the Share Insurance Fund from any industry losses," NCUA Chairman Debbie Matz said. Matz said the agency's 2013 budget also "sends a strong signal" that credit unions are improving.
"For credit unions, this budget increase is exasperating, particularly as other federal financial institution regulators have held the line on their own budgets," Cheney countered. "Clearly, the NCUA believes it has no reason to take a similar line--one that the President of the United States has personally mandated for federal agencies."
The 2013 budget represents the fourth-straight year that the agency has increased its budget. Cheney said the issue of ever-increasing budgets "necessitates greater oversight, accountability and transparency.
"We will express our deep concerns to the Obama administration, as well as lawmakers regarding oversight of the NCUA's budget. The agency must be held accountable for its budget decisions--and we intend to ensure that will happen," he added.
NCUA Chief Financial Officer Mary Ann Woodson, who presented the budget at the NCUA open meeting, said the agency will take steps to make budget information easier to find on the NCUA's website. CUNA earlier this week urged the agency to provide more transparency to credit unions about its budget decisions, before and after the budget is adopted in final form. A website detailing NCUA budget information could help create this much needed transparency, the CUNA letter noted.
The 2013 operating fee for federal credit unions will increase by 0.24% as a result of the new budget. The NCUA also approved a 6.5% increase in the asset dividing point for the 2013 operating fee scale that the agency uses to determine the fee assessed to federal credit unions. The corporate federal credit union rate scale remains unchanged, and federal credit unions with less than $1 million in assets will not be assessed an operating fee for 2013.
The operating fees for federal credit unions, which will be assessed based on assets as of Dec. 31, 2012, will be due to NCUA no later than April 30, 2013.