Two proposals affecting the federal credit union regulatory agency’s key funding mechanisms are slated to publish the Federal Register Monday with comments due 60 days after that, or on or about Oct. 30.
One of the proposals, issued by the National Credit Union Administration (NCUA) Board July 30, would revise how federal credit union (FCU) assets are calculated for operating fee assessment purposes. The other affects the methodologies used in setting the agency’s operating fee schedule and the overhead transfer rate (OTR).
The proposal on the asset calculation for a FCU’s operating fee would exclude from the institution’s total assets any loan the FCU reports under the Small Business Administration’s Paycheck Protection Program (PPP) “or similar future programs the Board may decide to exclude,” the agency said. The proposed rule would also change the calculation of total assets used in setting the institution’s operating fee: instead of total assets reported on the institution’s Dec. 31 call report of the preceding year, total assets would be calculated as the average total assets reported on the FCU’s previous four call reports available at the time the NCUA Board approves the coming year’s budget – which has typically been done in November (except last year, when it was approved in December).
In its proposal on the operating fee schedule and OTR methodology:
- Proposes clarifications and asks questions about the methodology the agency uses to determine how it apportions operating fees charged to FCUs. The board hopes to act on the proposed changes before 2021 operating fees are assessed. For example, the board proposes to clarify the treatment of capital project budgets and miscellaneous revenues when calculating future operating fees; and, among other things, make conforming changes on the calculation of annual inflationary adjustments to operating fee rate tier thresholds to be consistent with the above-noted proposed operating fee rule changes.
- Seeks public input on overhead transfer rate (OTR) methodology– a “principles-based” methodology used to calculate how much of the agency’s yearly budget will be paid through the National Credit Union Share Insurance Fund (NCUSIF). This notice offers no proposed changes but is in line with the agency’s decision to requesting public comment on the OTR methodology every three years “and in the event it proposes a change to one or more of the principles.”