NCUA Proposes 3.9% Increase in Operating Budget for 2020
The NCUA attributes one factor in the budget jump to the increase in mandatory contributions that all federal agencies must make to the Federal Employee Retirement System.
The NCUA on Tuesday proposed a 2020 agency operating budget of $316.2 million, an $11.8 million increase over the board-approved 2019 budget.
That amounts to a 3.9% increase over 2019.
The operating budget is projected to increase to $326 million in 2021.
Overall, the agency proposed a 2020 budget of $347.7 million, a $3.9 million boost over the board-approved 2019 budget.
The NCUA posted its budget justification on its website Tuesday morning and will accept comments on the plan until Dec. 2. The agency scheduled a Nov. 20 public budget briefing.
“Careful stewardship of the resources credit unions make available to us includes being transparent and accountable,” NCUA Board Chairman Rodney E. Hood said, in announcing the budget and briefing. He added that while the final budget decision rests with the agency board, he wants to ensure that members take public comments into account when voting on the document.
The board is expected to vote on the budget at its December meeting.
Critics of past budgets have questioned funding increases since the number of credit unions is decreasing.
“Although the number of credit unions continues to decline nationwide, the NCUA must also consider the increasing complexity and growing asset base of the entire credit union system,” the agency’s budget document states.
NCUA officials said a significant factor in the budget increase is a boost in mandatory contributions that all federal agencies must make to the Office of Personnel Management for the Federal Employee Retirement System.
They said that of the total 3.9% budget increase, 1.6% can be directly attributed to the increased retirement contribution. Nearly all agency employees participate in the retirement system.
The budget proposal also calls for:
- No change in the operating fee methodology. The overall fee increases for 2020 amounts to 1.2%.
- An increase of three employee positions. Two of the employees would focus on cybersecurity issues, while one would focus on communications efforts.
- A 2.2% increase in the travel budget, to $27.4 million. The agency plans to train credit union examiners to conduct examinations using the Modern Examination and Risk Identification System. The budget includes about $1 million for one-time travel costs for 778 agency employees to participate in MERIT training in 2020.
- A $3.1 million increase in the capital budget; a major part of the capital budget is the development of the first phases of the Enterprise Solution Modernization program.