WASHINGTON––In its comment letter to NCUA on the overhead transfer rate methodology and the operating fee, CUNA applauded the agency for making the process simpler and more transparent, but also offered some ideas on changes it would like to see.
CUNA noted it has “consistently opposed” any overhead transfer of agency expenses to the NCUSIF that is not for legitimate, substantiated “insurance-related” costs, consistent with fairness to state and federal credit unions.
The trade group said it agrees with NCUA that the proposal would clarify that for the purpose of calculating the operating fee, the budget for capital projects would be included within the total annual budget subject to the OTR, and that the approach would ensure that the cost of new capital acquisitions is borne equitably between FCUs and FISCUs at the time such acquisitions are made and is consistent with the 2018 change that excluded other non-cash expenses from the budget.
While noting it also agrees with a number of other components of the proposal, CUNA said when it comes to the operating fee asset threshold it believes the current threshold of less than $1 million is insufficient and would like to see the figure raised to less than $10 million.
Speaking of Equality
In addition, CUNA said it appreciates the agency’s efforts to encourage participation in its diversity assessment, including through a possible discount to the operating fee for FCUs, it believes that in keeping with the theme of equality and fairness, it is “imperative that a corresponding discount be available for FISCUs that participate in the assessment.”
CUNA further noted that since NCUA’s assessment is the same as the assessment for the largest banks, the agency should consider creating a streamlined version of the assessment that is more appropriate for credit unions, particularly those with less complex operations and/or limited staff.