ALEXANDRIA, Va. — During today's NCUA Board meeting, the agency approved a higher than anticipated budget increase following a new bargaining agreement with the National Treasury Employees Union.

The final 2008 budget approved was for $158,631,447, representing a $6.6 million increase or 4.35%, over the 2007 budget. Saying a bargaining agreement would have further impact on its budget, NCUA had projected its public budget briefing for a 3.0% increase.

NCUA Executive Director Len Skiles said merit pay increases will range anywhere from 2.75% to 8.25%, averaging 5.0%. Locality pay is expected to go up in most areas as well. Other significant budget items are a $5 million accounting program upgrade for the 11-year-old system and seven additional examiners.

NCUA's projected a 2009 budget accounts of $168.4 million, an increase of $9.8 million or 6.17% over the requested 2008 budget.

The overhead transfer rate dropped to 52.0% while the operating fees paid by federal credit unions was up 9.85%.

The NCUA Board also unanimously approved a final rule to include a conflict of interest provision regarding eligible obligations, which should not bring any added regulatory burdens for credit unions.

Shell New Orleans Federal Credit Union's application to convert to a community charter was also approved.