Lawmaker to introduce stand-alone OTR transparency bill
June 30, 2016 -- Legislation mandating increased transparency for the calculation of the transfer of funds from the National Credit Union Share Insurance Fund to the NCUA budget via the “overhead transfer rate” – including a breakdown of costs – will be introduced as stand-alone legislation, a member of Congress told a Washington group this week.
Rep. Mick Mulvaney, R-S.C., in remarks to the National Association of Federal Credit Unions, said he would introduce the legislation as a stand-alone, although the provision is also contained in the Financial CHOICE Act, proposed by House Financial Services Committee Chairman Jeb Hensarling, R-Texas. The “CHOICE” bill (which stands for “Creating Hope and Opportunity for Investors, Consumers and Entrepreneurs”) is a sweeping reform of the Dodd-Frank legislation enacted in the wake of the financial crisis of the last decade.
However, Mulvaney gave no particular timetable for introducing the legislation as a stand-alone. In early June, Hensarling said he would introduce his reform bill “later this month.”
According to the text of the discussion draft of Hensarling’s CHOICE bill, the OTR transparency provision (which is under Subtitle S on the last page of the of the 498-page bill) would require the NCUA Board to accompany each annual budget with ‘‘a detailed analysis of how the expenses of the Administration are assigned between prudential activities and insurance-related activities and the extent to which those expenses are paid from the fees collected” or from the insurance fund.
The report would also have to explain the “Board’s supporting rationale for any proposed use of amounts in the Fund contained in such budget, including detailed breakdowns and supporting rationales.” The provision further mandates that each report be available to the public.
NASCUS President and CEO Lucy Ito voiced interest in working with Rep. Mulvaney as on the provision. “NASCUS has repeatedly recommended greater transparency for the OTR, out of our long-held concern regarding the OTR methodology, and the agency’s management of its complex role as both a chartering authority and an insurance fund administrator,” she said.