As Prepared for Delivery on July 21, 2022
Thank you, Eugene, and team for your presentation.
Last year we voted on the mid-session budget in September. I’m sure the credit union community welcomes the timeliness of this year’s review, and the fact you are working on delivering the 2023 budget earlier as well.
Transparency in government is one of my guiding principles. It goes hand in hand with regulatory clarity and timeliness. Agencies like NCUA are quirky in that the agency just says a dollar amount, and then credit unions must pay it. That’s obviously unlike any other transaction we do in life. Even politicians that set tax rates know they will soon face the voters’ opinion. A business that charges too much will lose customers. But our situation is indeed somewhat quirky at NCUA; it’s a rather different type of ‘transaction.’
So, I’d like to propose that the budget hearing we have later this year be a true dialog between NCUA and those who pay us. The hearing should have an actual ‘give and take’ so to speak, between NCUA and credit unions to arrive at a common understanding. This type of hearing seems fair, and it’s another way NCUA can be a model of good government.
Although we are not voting on it today, I wish to comment on the projected surplus of $18 million. It is not a surprise that the $18 million is concentrated in two areas – Pay and Travel. A surplus is a good thing, much preferred to the alternative. Yet this $18 million surplus is credit union money, for the simple reason that all of NCUA’s budget is credit union money. My questions today will focus on how credit unions themselves benefit from this surplus.
I am hopeful that once we get back to normal –or more accurately – our new normal, NCUA – just like the rest of the world – can continue to take advantage of the lessons we learned regarding virtual exams, as well as communications, meetings, and more. The cost savings and efficiencies could have a significant impact on future budgets. We certainly deserve some positives from the forced experiment caused by the pandemic!
I do have a couple of questions for you, Eugene.
- Last year we had a significant surplus and some of it was returned to the credit unions. How does this projected surplus differ and is there an opportunity for some of this surplus cash to be sent to credit unions?
- Eugene, as you know, last year my office spent a fraction of its travel budget. I didn’t get to keep any of that money for this year, correct?
- When do you estimate we will see the first draft of the 2023 budget?
- Are you on board for a different kind of budget hearing this year, one that occurs well before the final budget, one that involves good-faith back and forth with stakeholders, and one that might result in changes to the budget itself?
Thank you, Mr. Chairman. This concludes my remarks.