NCUA Under the Microscope This Week
Congressional leaders and the public will get the chance to question agency officials this week on a variety of issues.
NCUA Board members, and especially Chairman Todd Harper, have a busy week ahead of them. Harper is expected to testify in front of Senate and House Committees Tuesday and Wednesday to give an update on the agency’s work. And Thursday, after the NCUA Board meeting, officials from CUNA, NAFCU and other organizations plan on grilling agency leaders about its proposed 2024-2025 budget.
On Tuesday, the Senate Banking, Housing Urban Affairs Committee will hold a hearing called “Oversight of Financial Regulators: Protecting Main Street Not Wall Street.” Harper will be testifying along with leaders of the Federal Reserve, FDIC and the Office of the Comptroller of the Currency to face questions from lawmakers who are focused on more consumer protection efforts from the organizations.
On Wednesday, Harper will face similar questions during testimony at the House Financial Services Committee. Wednesday’s hearing, “Oversight of Prudential Regulators,” will include the same regulatory leaders for hours of questioning.
During Thursday’s scheduled NCUA Board meeting, members are expected to pass Final Rule, Part 721, Charitable Donation Accounts. The NCUA Board approved the proposed rule during its May meeting to add veterans’ organizations as defined by the Internal Revenue Code 501(c)(19) and aligned it “with the purposes of the current charitable donation account rule.”
Credit union leaders around the country have supported this final rule. CUNA Senior Director of Advocacy and Counsel Luke Martone said the organization supports federal credit unions using a Charitable Donation Account (CDA) to contribute to the expanded definitions of “qualified charities.”
In a letter submitted for comment to the Federal Register, Martone wrote, “We reached out to the NCUA last year to advocate for inclusion of ‘veterans’ organizations’ in the definition of ‘qualified charity’ for purposes of the CDA rule. Aside from our belief that veterans’ organizations are of such importance as to be worthy of inclusion in the ‘qualified charity’ definition, the impetus for our advocacy was direct feedback from our member credit unions.”
A short time after Thursday’s meeting, board members will hear from the public concerning the agency’s proposed 2024-2025 budget.
The NCUA published its 2024-2025 draft budget on Oct. 26 and the combined proposed budget totaled $394.5 million, which is a 9.5% hike from the 2023 budget. According to the NCUA, the proposed budget breaks down as follows:
- $382.1 million operating budget; 11% higher than 2023.
- $7.3 million capital budget; 35.6% lower than 2023.
- $5.1 million Share Insurance Fund administrative budget; 3.6% higher than 2023.
Three main factors appeared to contribute to the agency’s proposed increases in 2024:
- Net increase of 28 positions, or 2.3%, compared to the agency’s 2023 staffing level.
- Increase of $18.2 million for current employee compensation in 2024 compared to 2023.
- Increase of $10.7 million in contracted services for 2024.
Economists with CUNA and NAFCU will be presenting arguments during the hearing opposing the proposed budget hikes and additional personnel proposed. Officials from both organizations have asked the NCUA to “rein in unnecessary spending,” especially during this time of higher inflation.
The public hearing is scheduled for 2 p.m. EST and can be watched via livestream.