ALEXANDRIA, Va.–As CUToday.info reports separately, the NCUA board has voted 3-0 to approve operating budgets for 2024 and 2025 that are smaller than proposed earlier this year, but for next year is still up 7%. For 2025, the budget increases by nearly $48 million.
An update on the budget was presented during the board meeting by CFO Eugene Schied, who provided additional details on what the agency is plans to spend over the next two years.
The board approved a combined operating budget, capital budget and share insurance fund administrative budget of $385.7 million for 2024, an increase of 7% over 2024. It had proposed a 9.5% increase. The 2024 budget covers 1,247 full-time employees.
For 2025, the proposed budget rises considerably to $433.3 million, with plans to employ 1,251 full timers.
Some of the Specifics
Here is some of what Schied told the board:
- Compared to the proposed staff budget, the 2024 final operating budget has been reduced by $7.6 million and the final capital budget by $1.2 million, while the 2024 final share insurance fund administrative expense budget was increased by $6,000.
- The 2025 combined budget reflects an increase over 2024 of $47.6 million, including four additional full-time employees. As Schied noted, the big jump in 2025 is due to $24.5 million in funds being carried over from 2023 for the 2024 budget that are unlikely to be available in 2025.
- There has been a $2 million reduction in travel expenses in the 2024 budget from the proposed budget, and two full-time positions have been eliminated.
- Funding for a new Office of the Executive Secretary has been chopped. Numerous other proposed hires have either been eliminated or deferred.
- One new position for the Office of External Affairs and Communications has been added to lead implementation of the mandated 21st Century Digital Experience Act and other newly established federal government requirements on websites.
- Funding for some specialist examiner positions have been delayed.
- The recommended final 2025 capital budget is unchanged from the staff draft.
- The recommended budgets for 2024 and 2025 for the Share Insurance Fund’s administrative expenses are higher than the staff draft by approximately $6,000 and $131,000, respectively.
- The 2024 budget includes approximately $13 million to operate and maintain the MERIT examination system and to pay for the infrastructure costs associated with the system, such as cloud services, engineering support and security functionality.
- The final 2024 budget reduces contract services by approximately $5.1 million.
- The 2024-25 budget does not discuss climate financial risk. But Schied said NCAA is working jointly with four with other federal regulators to analyze how changing climate may impact financial systems.
- The final 2024 overhead transfer rate is 61.7%, a decrease of 10 basis points compared to the staff draft. The final 2024 OTR is 70 basis points lower than the rate calculated for the 2023 budget. The residual 38.3% of the 2024 budget will be collected through the operating fee billed to federal credit unions.
- The operating fee charged to federal credit unions in 2024 will increase by approximately 16.36% as compared to 2023, a 3.25 percentage point reduction from what had been estimated.