NCUA’s proposed changes to the overhead transfer rate is consistent with CUNA’s continued opposition of transfer of agency expenses from the share insurance fund for non-insurance related costs. CUNA wrote to NCUA Tuesday in response to proposed revisions to the OTR methodology.
“CUNA has consistently opposed any overhead transfer of agency expenses to the National Credit Union Share Insurance Fund (NCUSIF) that is not for legitimate, substantiated “insurance-related” costs, consistent with fairness to state and federal credit unions and the Federal Credit Union Act,” the letter reads. “We believe the proposed changes represent an approach that will lead to more fair and consistent assessments.”
The OTR is taken from the share insurance fund and covers expenses related to NCUA’s insurance-related activities. It is currently set at 67.7% for 2017, but NCUA has proposed to decrease it to 60% for the remainder of 2017.
CUNA believes the proposed methodology makes the process easier to understand, and could save resources while maintaining a fair and equitable distribution of funding obligations.
CUNA previously proposed an alternative OTR model in an April 2016 that would have led to a 56.3% OTR for 2017.