69–006 

114TH CONGRESS REPORT " ! HOUSE OF REPRESENTATIVES 2d Session 114–868 

NATIONAL CREDIT UNION ADMINISTRATION BUDGET 

TRANSPARENCY ACT 

DECEMBER 12, 2016.—Committed to the Committee of the Whole House on the State 

of the Union and ordered to be printed 

Mr. HENSARLING, from the Committee on Financial Services, 

submitted the following 

R E P O R T 

together with 

MINORITY VIEWS 

[To accompany H.R. 2287] 

[Including cost estimate of the Congressional Budget Office] 

The Committee on Financial Services, to whom was referred the 

bill (H.R. 2287) to require the National Credit Union Administration to hold public hearings and receive comments from the public 

on its budget, and for other purposes, having considered the same, 

report favorably thereon without amendment and recommend that 

the bill do pass. 

PURPOSE AND SUMMARY

H.R. 2287 amends Section 209(b) of the Federal Credit Union Act 

(12 U.S.C. 1789) to require the National Credit Union Administration Board, before the annual submission of its detailed budget, to: 

(1) print a draft of the budget in the Federal Register; 

(2) hold a public hearing to receive comments from the public on the draft; and 

(3) detail how the budget will address comments submitted 

by the public. 

BACKGROUND AND NEED FOR LEGISLATION

The NCUA operates independent of the congressional appropriations process. The NCUA annual operating budget that funds credit union examination and supervisory activity is in turn funded 


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through direct and indirect assessments on the federally-insured 

state and federal credit unions it oversees. 

The Federal Credit Union Act (FCUA) provides that NCUA expenses incurred in the course of examination and supervision of 

federal credit unions may be covered by operating fees assessed on 

those same federal credit unions. Currently, federally insured credit unions provide a significant majority of the funding for the operations of the NCUA through those operating fees. Each Federal 

credit union is required to pay this fee based on its prior year asset 

balances and rates set by the NCUA Board. 

Between 2001 and 2008, under then-NCUA Chairman Dennis 

Dollar, the NCUA held annual public hearings on its budget. In 

2008, former Chairwoman Deborah Matz ceased the practice of 

holding public budget hearings. 

In a letter of support for H.R. 2287 dated May 13, 2015, the 

Credit Union National Organization wrote: 

The ‘‘National Credit Union Administration Budget 

Transparency Act’’ would direct the NCUA to establish a 

process by which the public, including members of the 

credit union community, may examine and comment on 

the agency’s proposed annual budget prior to adoption. Additionally, this legislation would ensure that members of 

the NCUA Board, who must vote to adopt the annual 

budget, have adequate opportunity to review specific expenditures and overall methodology in order to make an 

informed decision as to whether the budget as proposed accurately reflects the needs of the agency. This process 

would increase transparency and accountability at the 

agency, and engender public trust, thereby strengthening 

and supporting the agency’s mission. 

Credit union member resources are used to fund nearly 

all of NCUA’s budget. It is not too much to ask for the 

members of the NCUA Board to conduct a hearing and listen to stakeholder feedback from those responsible for 

funding the activities of the agency. We disagree with 

those who would suggest that a hearing on the agency’s 

budget would result in ‘‘regulatory capture’’. As a former 

Chairman of the House Budget Committee, I am well 

aware that Congress regularly holds hearings on the Federal budget and the activities of the various federal agencies to solicit stakeholder input and also to exercise its 

oversight responsibilities. This type of back and forth is an 

important part of our democratic process and your legislation, which would require NCUA to hold a hearing on its 

budget, is fully consistent with these principals. 

HEARINGS

The Committee on Financial Services’ Subcommittee on Financial Institutions held hearings examining matters relating to H.R. 

2287 on July 23, 2015 and October 21, 2015. 

COMMITTEE CONSIDERATION

The Committee on Financial Services met in open session on December 8, 2015 and December 9, 2015 and considered the bill. An 


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amendment offered by Mr. Royce was withdrawn. The Committee 

ordered H.R. 2287 to be reported favorably to the House without 

amendment by a recorded vote of 40 yeas to 16 nays (recorded vote 

no. FC–78), a quorum being present. 

COMMITTEE VOTES

Clause 3(b) of rule XIII of the Rules of the House of Representatives requires the Committee to list the record votes on the motion 

to report legislation and amendments thereto. The sole record vote 

in Committee was a motion by Chairman Hensarling to report the 

bill favorably to the House without amendment. The motion was 

agreed to by a recorded vote of 40 yeas to 16 nays (recorded vote 

no. FC–78), a quorum being present. 


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COMMITTEE OVERSIGHT FINDINGS

Pursuant to clause 3(c)(1) of rule XIII of the Rules of the House 

of Representatives, the findings and recommendations of the Committee based on oversight activities under clause 2(b)(1) of rule X 

of the Rules of the House of Representatives, are incorporated in 

the descriptive portions of this report. 

PERFORMANCE GOALS AND OBJECTIVES

Pursuant to clause 3(c)(4) of rule XIII of the Rules of the House 

of Representatives, the Committee states that H.R. 2287 will increase transparency and accountability at the NCUA by amending 

the current law to ensure that the public is provided an opportunity to weigh in as the NCUA considers its annual budget. 

NEW BUDGET AUTHORITY, ENTITLEMENT AUTHORITY, AND TAX

EXPENDITURES

In compliance with clause 3(c)(2) of rule XIII of the Rules of the 

House of Representatives, the Committee adopts as its own the estimate of new budget authority, entitlement authority, or tax expenditures or revenues contained in the cost estimate prepared by 

the Director of the Congressional Budget Office pursuant to section 

402 of the Congressional Budget Act of 1974. 

COMMITTEE COST ESTIMATE

The Committee adopts as its own the cost estimate prepared by 

the Director of the Congressional Budget Office pursuant to section 

402 of the Congressional Budget Act of 1974. 

CONGRESSIONAL BUDGET OFFICE ESTIMATES

Pursuant to clause 3(c)(3) of rule XIII of the Rules of the House 

of Representatives, the following is the cost estimate provided by 

the Congressional Budget Office pursuant to section 402 of the 

Congressional Budget Act of 1974: 

U.S. CONGRESS, CONGRESSIONAL BUDGET OFFICE, Washington, DC, January 29, 2016. 

Hon. JEB HENSARLING, Chairman, Committee on Financial Services, 

House of Representatives, Washington, DC. 

DEAR MR. CHAIRMAN: The Congressional Budget Office has prepared the enclosed cost estimate for H.R. 2287, the National Credit 

Union Administration Budget Transparency Act. 

If you wish further details on this estimate, we will be pleased 

to provide them. The CBO staff contact is Sarah Puro. 

Sincerely, 

KEITH HALL. 

Enclosure. 


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H.R. 2287—National Credit Union Administration Budget Transparency Act 

H.R. 2287 would require the National Credit Union Administration (NCUA) to make changes to its budget process. Because enacting H.R. 2287 would affect direct spending, pay-as-you-go procedures apply; however, CBO estimates that the net effect on direct 

spending would be negligible. Enacting the bill would not affect 

revenues. 

H.R. 2287 would require the NCUA to print a draft of its proposed budget in the Federal Register, to hold public hearings on 

the proposed budget, and to address the comments submitted by 

the public before the budget becomes final. Based on information 

from the NCUA, CBO estimates that the agency would need several additional staff members to complete the required work and to 

respond to public comments. However, CBO estimates that the net 

effects on the federal budget would be negligible because any increase in operating costs for NCUA would be offset by additional 

fees collected from federal credit unions. 

CBO estimates that enacting H.R. 2287 would not increase net 

direct spending or on-budget deficits by more than $5 billion in any 

of the four consecutive 10-year period beginning in 2027. 

H.R. 2287 contains no intergovernmental mandates as defined in 

the Unfunded Mandates Reform Act (UMRA) and would not affect 

the budgets of state, local, or tribal governments. 

If the NCUA increases fees to offset the costs of implementing 

the bill, H.R. 2287 would increase the cost of an existing mandate 

on private entities required to pay those fees. Based on information 

from the NCUA, CBO estimates that the aggregate cost of the 

mandate would be small and fall well below the annual threshold 

for private-sector mandates established in UMRA ($154 million in 

2016, adjust annually for inflation). 

The CBO staff contacts for this estimate are Sarah Puro (for federal costs) and Logan Smith (for private-sector mandates). The estimate was approved by H. Samuel Papenfuss, Deputy Assistant Director for Budget Analysis. 

FEDERAL MANDATES STATEMENT

The Committee adopts as its own the estimate of Federal mandates prepared by the Director of the Congressional Budget Office 

pursuant to section 423 of the Unfunded Mandates reform Act. 

ADVISORY COMMITTEE STATEMENT

No advisory committees within the meaning of section 5(b) of the 

Federal Advisory Committee Act were created by this legislation. 

APPLICABILITY TO LEGISLATIVE BRANCH

The Committee finds that the legislation does not relate to the 

terms and conditions of employment or access to public services or 

accommodations within the meaning of the section 102(b)(3) of the 

Congressional Accountability Act. 


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EARMARK IDENTIFICATION

H.R. 2287 does not contain any congressional earmarks, limited 

tax benefits, or limited tariff benefits as defined in clause 9 of rule 

XXI. 

DUPLICATION OF FEDERAL PROGRAMS

Pursuant to section 3(g) of H. Res. 5, 114th Cong. (2015), the 

Committee states that no provision of H.R. 2287 establishes or reauthorizes a program of the Federal Government known to be duplicative of another Federal program, a program that was included 

in any report from the Government Accountability Office to Congress pursuant to section 21 of Public Law 111–139, or a program 

related to a program identified in the most recent Catalog of Federal Domestic Assistance. 

DISCLOSURE OF DIRECTED RULEMAKING

Pursuant to section 3(i) of H. Res. 5, 114th Cong. (2015), the 

Committee states that H.R. 2287 contains no directed rulemaking. 

SECTION-BY-SECTION ANALYSIS OF THE LEGISLATION

Section 1. Short title 

This Section cites H.R. 2287 as the ‘‘National Credit Union Administration Budget Transparency Act.’’ 

Section 2. Budget transparency for the NCUA 

This section amends Section 209(b) of the Federal Credit Union 

Act to require that, prior to the submission of its budget, the 

NCUA make its budget publicly available on the Federal Register, 

hold a public hearing for comments on the draft of the budget and 

detail how the budget will address comments submitted by the 

public. 

CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED

In compliance with clause 3(e) of rule XIII of the Rules of the 

House of Representatives, changes in existing law made by the bill, 

as reported, are shown as follows (existing law proposed to be omitted is enclosed in black brackets, new matter is printed in italic, 

and existing law in which no change is proposed is shown in 

roman): 

FEDERAL CREDIT UNION ACT 

* * * * * * * 

TITLE II—SHARE INSURANCE 

* * * * * * * 

ADMINISTRATIVE PROVISIONS

SEC. 209. (a) In carrying out the purposes of this title, the Board 

may— 

(1) make contracts; 


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(2) sue and be sued, complain and defend, in any court of law 

or equity, State or Federal. All suits of a civil nature at common law or in equity to which the Board shall be a party shall 

be deemed to arise under the laws of the United States, and 

the United States district courts shall have original jurisdiction 

thereof, without regard to the amount in controversy. The 

Board may, without bond or security, remove any such action, 

suit, or proceeding from a State court to the United States district court for the district or division embracing the place 

where the same is pending by following any procedure for removal now or hereafter in effect, except that any such suit to 

which the Board is a party in its capacity as liquidating agent 

of a State-chartered credit union and which involves only the 

rights or obligations of members, creditors, and such State 

credit union under State law shall not be deemed to arise 

under the laws of the United States. No attachment or execution shall be issued against the Board or its property before 

final judgment in any suit, action, or proceeding in any State, 

county, municipal, or United States court. The Board shall designate an agent upon whom service of process may be made in 

any State, territory, or jurisdiction in which any insured credit 

union is located; 

(3) pursue to final disposition by way of compromise or otherwise claims both for and against the United States (other than 

tort claims, claims involving administrative expenses, and 

claims in excess of $5,000 arising out of contracts for construction, repairs, and the purchase of supplies and materials) 

which are not in litigation and have not been referred to the 

Department of Justice; 

(4) to appoint such officers and employees as are not otherwise provided for in this Act, to define their duties, fix their 

compensation, require bonds of them and fix the penalty thereof, and to dismiss at pleasure such officers or employees. Nothing in this or any other Act shall be construed to prevent the 

appointment and compensation as an officer or employee of the 

Administration of any officer or employee of the United States 

in any board, commission, independent establishment, or executive department thereof; 

(5) employ experts and consultants or organizations thereof, 

as authorized by section 15 of the Administrative Expenses Act 

of 1946 (5 U.S.C. 55a); 

(6) prescribe the manner in which its general business may 

be conducted and the privileges granted to them by law may 

be exercised and enjoyed; 

(7) exercise all powers specifically granted by the provisions 

of this title and such incidental powers as shall be necessary 

to carry out the powers so granted; 

(8) make examinations of and require information and reports from insured credit unions, as provided in this title; 

(9) act as liquidating agent; 

(10) delegate to any officer or employee of the Administration 

such of its functions as it deems appropriate; and 

(11) prescribe such rules and regulations as it may deem 

necessary or appropriate to carry out the provisions of this 

title. 


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(b) With respect to the financial operations arising by reason of 

this title, the Board shall— 

(1) on an annual basis and prior to the submission of the detailed business-type budget required under paragraph (2)— 

(A) make publicly available and cause to be printed in 

the Federal Register a draft of such detailed business-type 

budget; and 

(B) hold a public hearing, with public notice provided of 

such hearing, wherein the public can submit comments on 

the draft of such detailed business-type budget; 

ø(1)¿ (2) prepare annually and submit a detailed businesstype budget as provided for wholly owned Government corporations by the Government Corporation Control Act, and where 

such budget shall address any comments submitted by the public pursuant to paragraph (1)(B); and 

ø(2)¿ (3) maintain an integral set of accounts, which shall be 

audited annually by the General Accounting Office in accordance with principles and procedures applicable to commercial 

corporate transactions, as provided by section 105 of the Government Corporation Control Act. 

* * * * * * * 


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MINORITY VIEWS 

H.R. 2287 would require that the National Credit Union Administration (‘‘NCUA’’ or ‘‘Administration’’) conduct public hearings 

and receive public notice and comment on its draft budget. This 

proposal would seek to allow credit unions the ability to influence 

the NCUA’s budget, thereby undermining the financial independence afforded to the NCUA and every other federal prudential regulator. H.R. 2287’s requirements are without precedent as no other 

federal regulator is subject to annual, pre-decisional hearings or a 

public notice and comment process on its draft budget, and no federal regulator provides such hearings on a voluntary basis. 

Federal prudential regulators like the NCUA, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of 

the Currency are all independent of the appropriations process because the budgets of the agencies charged with the safety and 

soundness of our financial institutions should be shaped by the 

agency’s mission and its obligations under federal law—not from 

pressure from the entities they regulate. H.R. 2287 seeks a result 

similar to subjecting financial regulators to the appropriations 

process, albeit indirectly, through public hearings and a notice and 

comment period on the NCUA’s pre-decisional annual budgets. 

In the past, from the years 2001 to 2008, the NCUA conducted 

pre-decisional budget hearings, which H.R. 2287 seeks to reinstate. 

Unsurprisingly, the hearings were largely attended by the credit 

union industry where they were successful in pressuring the NCUA 

to reduce its budget. These hearings led to substantial reductions 

in the NCUA’s budget such that the NCUA’s staff in 2009 was 

smaller than it was in 2000. Consequently, when the Great Recession hit the nation’s credit unions, the NCUA was unprepared to 

respond. The NCUA rightly discontinued the budget hearings, and 

H.R. 2287 is seeking to re-establish them despite clear evidence of 

the harm that this practice caused during the period leading up to 

the financial crisis. 

The goal of this legislation is not transparency, but instead about 

regaining the influence that the industry once had over the 

NCUA’s budget from 2001 to 2009. The NCUA is already a peer 

leader amongst financial regulators in the information it already 

provides to the public on its budget, providing line-item budgets for 

each of the funds it administers; a dedicated webpage that provides 

detailed information on its budget including board memoranda on 

the budget and budget briefing summaries; answers to industrysubmitted questions about the budget; and, additional line-item 

budgets separated by each NCUA office on expenditures like employee compensation, travel, and procurement as well as a host of 

other budget-related topics. 

Budget decisions by financial regulators should be shaped by 

safety and soundness concerns and not by the industries they reguVerDate Sep 11 2014 02:31 Dec 22, 2016 Jkt 069006 PO 00000 Frm 00010 Fmt 6604 Sfmt 6604 E:\HR\OC\HR868.XXX HR868

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late. Credit unions continue to grow in size and complexity, and as 

credit unions seek to expand their capacity to use derivatives and 

engage in more small business lending, the NCUA should have the 

resources they need to keep pace with the credit union industry. If 

the past is prologue, H.R. 2287 would give the credit union industry a venue for pressuring the NCUA to cut its budget just as credit unions are growing and becoming more complex—a combination 

that exposes credit union members and the Share Insurance Fund 

that insures all credit union deposits to unnecessary risks. 

For the foregoing reasons, the Minority opposes H.R. 2287. 

MAXINE WATERS. 

WM. LACY CLAY. 

RUBE ́ N HINOJOSA. 

KEITH ELLISON. 

AL GREEN. 

Æ 


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