WASHINGTON—NAFCU and CUNA are supporting an amendment to a House appropriations bill that would strike the section of the bill that would subject the NCUA budget to the congressional appropriations process.
NAFCU is urging credit unions to ask their lawmakers to support the amendment.
The House started discussing amendments to the fiscal 2018 Department of the Interior, Environment, and Related Agencies Appropriations Act (HR 3354) late last week. Further amendments, including the one that would keep the NCUA out of the congressional appropriations process, are expected to come up for voting this week.
In an email to NAFCU members, association Vice President of Legislative Affairs Brad Thaler explained that this amendment, offered by Reps. Mark Amodei (R-NV) and Pete Aguilar (D-CA), would strike section 906 of the appropriations bill, which is the section of the bill that would subject the NCUA to the appropriations process.
While the bill contains a number of regulatory relief provisions supported by NAFCU, the association is concerned about the long-term impact this section of the bill could have on the NCUA and credit unions.
NAFCU Executive Vice President of Government Affairs and General Counsel Carrie Hunt also urged lawmakers to support the amendment in a letter late last week to House Speaker Paul Ryan (R-WI) and House Minority Leader Nancy Pelosi (D-CA).
"NCUA has a long, successful track record as an independent regulator of credit unions, and is fully funded by the industry," she wrote. "Subjecting NCUA to the appropriations process could potentially increase costs to credit unions and their 110 million members. It could also impact the ability of NCUA to effectively regulate the industry."
CUNA said it is actively engaged and strongly supports the amendment.
“We oppose Section 906 because it would jeopardize the independence of the federal credit union regulator and unnecessarily comingle credit union resources with taxpayer resources, potentially causing credit union resources to be used to pay for other areas of government,” CUNA President/CEO Jim Nussle wrote to Amodei and Aguilar.
“Maintaining a separate, independent federal credit union regulator and insurer is critically important to the credit union system, and the structural and mission-driven differences between credit unions and banks necessitate such a regulatory scheme: credit unions' not-for-profit structure and their mission to promote thrift and provide access to credit for provident purposes are fundamentally different than other financial services providers,” Nussle added.
Since NCUA is funded by credit unions and their members, not by taxpayers, credit unions and their members remain willing to pay for their own regulatory agency, provided there is sufficient transparency with respect to the agency’s budget and overhead transfer rate, Nussle emphasized.
CUNA stated that it believes that NCUA, particularly under current leadership, has made great progress in increasing transparency.
In the letter, Nussle also noted that subjecting NCUA to the appropriations process could be viewed as a tax, as credit union resources could be appropriated to pay for or offset other government priorities.
“Credit unions, which are tax exempt based on their structure as not-for-profit financial cooperatives and their mission to promote thrift and provide access to credit for provident purposes, are not required to pay for other areas of the federal government nor are taxpayers called on to pay for NCUA operations. There is no compelling reason to change that arrangement,” Nussle wrote.