Federal Register / Vol. 88, No. 243 / Wednesday, December 20, 2023 / Notices 88131 

1See, e.g., 12 U.S.C. 1783(a) (making the Share 

Insurance Fund available ‘‘for such administrative 

and other expenses incurred in carrying out the 

purpose of [Subchapter II of the FCU Act] as [the 

Board] may determine to be proper.’’). 

2 12 U.S.C. 1755(a) (‘‘In accordance with rules 

prescribed by the Board, each Federal credit union 

shall pay to the Administration an annual operating 

fee which may be composed of one or more charges 

identified as to the function or functions for which 

assessed.’’). 

3 12 U.S.C. 1783(a) (‘‘Money in the fund shall be 

available upon requisition by the Board, without 

fiscal year limitation, for making payments of 

insurance under section 1787 of this title, for 

providing assistance and making expenditures 

under section 1788 of this title in connection with 

the liquidation or threatened liquidation of insured 

credit unions, and for such administrative and 

other expenses incurred in carrying out the 

purposes of this subchapter as it may determine to 

be proper.’’). 

4 12 U.S.C. 1755. 

5 12 U.S.C. 1755(d). 

6Public Law 91–468; 12 U.S.C. 1783. 

7 General Accounting Office, Examination of 

Financial Statements of the Nat’l Credit Union 

Admin. (Sept. 18, 1973), https://www.gao.gov/ 

assets/b-164031%284%29-096067.pdf. 

5.6 Security Management Records 

Revision (DAA–GRS–2023–0007). 

Laurence Brewer, 

Chief Records Officer for the U.S. 

Government. 

[FR Doc. 2023–27958 Filed 12–19–23; 8:45 am] 

BILLING CODE 7515–01–P 

NATIONAL CREDIT UNION 

ADMINISTRATION 

[NCUA–2023–0142] 

Request for Comment Regarding 

Overhead Transfer Rate Methodology 

AGENCY: National Credit Union 

Administration (NCUA). 

ACTION: Request for comment. 

SUMMARY: The NCUA Board (Board) is 

inviting comment on the methodology 

used to determine the Overhead 

Transfer Rate (OTR). The Board applies 

the OTR to the NCUA’s operating 

budget to determine the portion of the 

budget that will be funded from the 

National Credit Union Share Insurance 

Fund (Share Insurance Fund). In 

response to industry recommendations, 

the Board has provided more detail, 

clarity, and transparency so the public 

can better understand the OTR 

methodology. 

DATES: Comments must be received on 

or before February 20, 2024. 

ADDRESSES: You may submit written 

comments, identified by Docket ID 

NCUA–2023–0142, by any of the 

following methods (Please send 

comments by one method only): 

Federal eRulemaking Portal: https://

www.regulations.gov. Follow the 

instructions for submitting comments 

for Docket ID NCUA–2023–0142. 

Mail: Address to Melane ConyersAusbrooks, Secretary of the Board, 

National Credit Union Administration, 

1775 Duke Street, Alexandria, Virginia 

22314–3428. 

Hand Delivery/Courier: Same as 

mailing address. 

Public Inspection: You may view all 

submitted public comments on the 

Federal eRulemaking Portal at https://

www.regulations.gov except for those 

we cannot post for technical reasons. 

The NCUA will not edit or remove any 

identifying or contact information from 

the public comments submitted. If you 

cannot access public comments on the 

internet, you may contact the NCUA for 

alternative access by calling (703) 518– 

6360 or emailing EIMail@ncua.gov. 

FOR FURTHER INFORMATION CONTACT: 

Amy Ward or Sarah Savoie, Risk 

Officers, Office of Examination and 

Insurance at (703) 819–1770 or (571) 

451–7204; or by mail at National Credit 

Union Administration, 1775 Duke 

Street, Alexandria, VA 22314–3428. 

SUPPLEMENTARY INFORMATION: The Board 

is inviting comment on the NCUA’s 

methodology to determine the OTR. The 

Board applies the OTR to the NCUA’s 

operating budget to determine the 

portion of the NCUA’s budget that will 

be funded from the Share Insurance 

Fund. In response to industry 

recommendations, this request for 

comment provides added detail, clarity, 

and transparency to help the public 

better understand the NCUA’s 

methodology to calculate the OTR. No 

changes to the existing OTR 

methodology are being proposed as part 

of this request for comment. The added 

transparency and clarity do not 

constitute a change in methodology. 

I. Background 

The NCUA charters, regulates, and 

insures deposits in federal credit unions 

(FCUs) and insures deposits in federally 

insured state-chartered credit unions 

(FISCUs) that have their shares insured 

through the Share Insurance Fund. To 

cover the NCUA’s task-related expenses, 

the Board approves a two-year budget 

and revisits the budget each year. The 

FCU Act provides two primary sources 

to fund the budget: (1) requisitions from 

the Share Insurance Fund, referred to as 

the OTR; 1 and (2) operating fees 

charged against FCUs.2

The first budget funding source listed 

above, the OTR, represents the formula 

the NCUA uses to allocate insurancerelated expenses to the Share Insurance 

Fund under Title II of the FCU Act. 

There are two statutory provisions that 

outline the Board’s discretion regarding 

the OTR. First, expenses funded from 

the Share Insurance Fund must carry 

out Title II’s purposes, which relate to 

share insurance.3 Second, the NCUA 

may not fund its entire budget through 

charges to the Share Insurance Fund.4

The NCUA has not imposed regulatory 

limitations in its discretion for 

determining the OTR. 

The second budget funding source is 

operating fees assessed to FCUs. 

Operating fees are required for FCUs 

under 12 U.S.C. 1755 ‘‘and may be 

expended by the Board to defray the 

expenses incurred in carrying out the 

provisions of the FCU Act, including the 

examination and supervision of 

FCUs.’’ 5 The Board uses the following 

OTR methodology to determine an 

appropriate division of expenses 

between the operating fee and the OTR. 

II. Historical Practice in Determining 

the Overhead Transfer Rate 

The Share Insurance Fund was 

established under Title II of the FCU Act 

on October 19, 1970.6 Section 1783(a) of 

the FCU Act authorizes the Board to use 

the Share Insurance Fund to pay for 

such administrative and other expenses 

incurred in carrying out this title’s 

purposes as it deems proper. 

In 1973, a Government Accountability 

Office audit recommended the NCUA 

adopt a method of allocating costs 

between the operating fund and the 

newly formed Share Insurance Fund.7

Between 1973 and 1980, various cost 

allocation methods were employed, 

including direct charges to the Share 

Insurance Fund for insurance expenses 

such as costs to liquidate or merge 

credit unions and examiner time spent 

conducting safety and soundness 

examinations. Starting in 1981, the OTR 

ranged between 30 and 34 percent and 

stayed in that range through 1984. 

From 1985 through 1994, the NCUA 

conducted annual examiner time 

surveys (ETS) to determine an 

appropriate factor for apportioning the 

agency’s total operating expenses. The 

survey results supported a transfer rate 

between 50.1 percent and 60.4 percent 

for insurance-related activities; 

however, the Board maintained the OTR 

at 50 percent. 

After the 1994 survey, the Board 

approved surveys that were conducted 

every three years. Three-year surveys 

covered fiscal years 1995 through 1997 

and fiscal years 1998 through 2000. 

During that time, the OTR was kept at 

50 percent. The Board voted to resume 

the annual ETS in 2000 and expanded 

the survey to include more examiners. 

The 2000 survey results supported an 


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88132 Federal Register / Vol. 88, No. 243 / Wednesday, December 20, 2023 / Notices 

8 Deloitte & Touche, Independent Accountant’s 

Report on Applying Agreed Upon Procedures (Sept 

5, 2001), https://www.ncua.gov/files/publications/ 

budget/2001DeloitteReportonOTRProcess.pdf. 

9The Board approved refinements to the 

methodology in 2013. See NCUA, ‘‘Board Action 

Memorandum’’ (Nov. 20, 2013), https://ncua.gov/ 

files/agenda-items/AG20131121Item5a.pdf. 

10 81 FR 4804 (Jan. 27, 2016). 

11 82 FR 29935 (June 30, 2017). 

12 82 FR 55644 (Nov. 22, 2017). 

13 82 FR 55652. 

14For additional information on the OTR and 

further discussion of the principles, please refer to 

https://ncua.gov/news/budget-supplementarymaterials. 

15See, e.g., 82 FR 55651 (‘‘The 50 percent 

allocation mathematically emulates an examination 

and supervision program design where the NCUA 

would alternate examinations, or conduct joint 

examinations, between its insurance function and 

its prudential regulator function if they were 

separate units within the NCUA. It reflects an equal 

sharing of supervisory responsibilities between 

NCUA’s dual roles as charterer/prudential regulator 

and insurer given both roles have a vested interest 

in the safety and soundness of federal credit unions. 

It is consistent with the alternating examinations 

FDIC and state regulators conduct for insured statechartered banks as mandated by Congress.’’). 

16The NCUA’s annual resource budget is a 

comprehensive workload analysis that captures the 

amount of time budgeted to conduct examinations 

and supervision of FICUs and other programs 

necessary to execute the NCUA’s dual mission as 

insurer and regulator. The annual resource budget 

estimates hours in three major categories. 1. Core 

Programs include the NCUA’s FCU and FISCU 

examinations and on- and off-site supervision. 2. 

Special Programs includes the NCUA’s specialized 

examination programs in the areas of capital 

markets, information systems, and lending; credit 

union service organization reviews; chartering and 

field of membership; and small credit union 

development. 3. Administrative includes NCUA 

field staff time related to training and staff 

development, leave, and travel. 

OTR of 66.72 percent, and after 15 years 

of holding the OTR at 50 percent, the 

Board increased the OTR to 66.72 

percent for fiscal year 2001. 

In 2001, the Board hired an 

independent audit and accounting firm 

to assess the OTR process. The 

independent audit and accounting firm 

issued its review of the OTR process on 

September 5, 2001, and included several 

recommendations to improve the OTR 

process.8 These recommendations were 

implemented in 2002. 

At the November 20, 2003, Board 

meeting, the Board adopted a revised, 

comprehensive methodology for 

calculating the OTR that remained in 

place until 2017.9 The methodology 

used the results of an automated annual 

ETS process. The following were also 

factored into the methodology: 

• The value to the Share Insurance 

Fund of the insurance-related work 

performed by state supervisory 

authorities or prudential regulator. 

• The cost of the NCUA resources and 

programs with different allocation 

factors from the examination and 

supervision program. 

• The distribution of insured shares 

between FCUs and FISCUs. 

• The operational costs charged 

directly to the Share Insurance Fund. 

In 2016, the NCUA published in the 

Federal Register the OTR methodology 

used to calculate the OTR and requested 

comments from the public.10 Along with 

the 2016 Federal Register notice, the 

Board committed to periodically review 

the methodologies for calculating both 

the OTR and the operating fee and to 

propose changes to the methodologies 

that would result in more equitable 

alignment of fees to the resource levels 

required to supervise and regulate both 

FCUs and FISCUs. 

In June 2017, the NCUA published a 

request for comment 11 in the Federal 

Register regarding a revised OTR 

methodology based on the Board’s 

internal assessment and comments 

received from the 2016 notice. At that 

time, the primary goal of the proposed 

changes to the OTR methodology was to 

simplify and streamline the OTR 

methodology and reduce the resources 

needed to administer the OTR. The 

simplified OTR methodology focused on 

assigning a percentage share of work to 

insurance costs in four categories of 

activities. 

• 50 percent insurance-related—Time 

spent examining and supervising FCUs. 

• 100 percent insurance-related—All 

time and costs the NCUA spends 

supervising or evaluating the risks 

posed by FISCUs or other entities the 

NCUA does not charter or regulate (e.g., 

third-party vendors and credit union 

service organizations). 

• Zero percent insurance-related— 

Time and costs related to the NCUA’s 

role granting federal charters and as 

enforcer of consumer protection and 

other non-insurance-based laws 

governing the operation of credit 

unions; for example, field of 

membership requirements. 

• 100 percent insurance-related— 

Time and costs related to the NCUA’s 

role in administering federal share 

insurance and the Share Insurance 

Fund. 

The Board adopted the current OTR 

methodology in November 2017.12 At 

that time, the Board committed to 

subjecting the four general principles 

outlined in the paragraphs below to 

public comment every three years and 

when it proposes a change to the 

methodology.13

Clarification of the Four Principles 14

In response to industry 

recommendations, the NCUA Board is 

providing more information in this 

notice to ensure clear understanding of 

the four principles used in the OTR 

calculation and to provide added 

transparency. 

1. 50 percent insurance-related—The 

NCUA is the prudential regulator of 

FCUs and provides federal share 

insurance to both FCUs and FISCUs. 

Because the NCUA acts as both 

prudential regulator and insurer of 

FCUs, its oversight of these FCUs is 

equally focused on the statutory 

requirements applicable to FCUs under 

Title I of the FCU Act and minimizing 

losses to the Share Insurance Fund 

under Title II of the FCU Act. 

Historically, the NCUA has referred to 

its regulator and insurer responsibilities 

by comparing this dual role to the 

Federal Deposit Insurance Corporation’s 

(FDIC) practice of alternating 

examinations with the state regulatory 

agencies overseeing banks.15 The 

NCUA’s reference to this 50 percent 

allocation as ‘‘mathematically’’ 

emulating the alternating FDIC and state 

regulatory examinations has caused 

both concern and misunderstanding 

among industry stakeholders. This 

statement’s intent was to reflect the 

NCUA’s dual role on each examination 

(that of regulator and that of insurer), 

not to imply that the NCUA alternates 

examinations with the state regulatory 

agencies like the FDIC. For example, the 

NCUA evaluates the safety and 

soundness impact of FCU-operational 

decisions along with the FCUs’ 

operating condition, assessing the 

impact of these decisions to the FCU 

individually as well as to the Share 

Insurance Fund. The NCUA’s resource 

budget reflects the total hours needed to 

provide the oversight responsibility of 

both its regulator and insurer roles.16

2. 100 percent insurance-related—The 

NCUA oversight authority for FISCUs is 

principally related to insurance 

activities and the focus on these entities 

is as an insurer of federally insured 

credit unions (FICUs). The NCUA also 

lacks direct oversight authority for 

credit union service organizations 

(CUSOs) and third-party vendors. 

Because the NCUA does not have 

regulatory oversight of the FISCUs, 

CUSOs, and third-party vendors, the 

NCUA’s resource budget reflects the 

hours necessary to provide this 

responsibility as insurer of FICUs and 

the risks these entities present to the 

Share Insurance Fund. The OTR 

methodology assigns a 100 percent 

insurance-related allocation factor to 

this budgeted time. 

• CUSOs and third-party vendors 

provide various services to FICUs (thirdparty arrangements). Like any 


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17NCUA, Third Party Vendor Authority (March 

2022), https://ncua.gov/files/publications/ 

regulation-supervision/third-party-vendorauthority.pdf. 

18 12 CFR part 712. 

19NCUA, ‘‘NCUA Exam Flexibility Initiative,’’ 

https://ncua.gov/regulation-supervision/ 

examination-modernization-initiatives/examflexibility-initiative. 

20The industry has commented that there are 

twice as many FCUs as there are FISCUs. The time 

budgeted under the examination and supervision 

categories of the OTR methodology accounts for the 

varying aspects of the financial institutions (number 

of institutions; asset size; risk profile; staff 

resources, to include specialists and subject matter 

examiners; and frequency of onsite examinations 

and offsite supervision). 

outsourced activity, these third-party 

arrangements present additional risk to 

the FICUs and the Share Insurance 

Fund.17

Æ As per its regulator and insurer 

responsibilities under Title I and Title II 

of the FCU Act, the NCUA performs a 

limited review of the activities FICUs 

undertake with CUSOs and third-party 

vendors during its safety and soundness 

exams. These limited reviews are 

captured under Principle 1 for FCUs 

and Principle 2 for FISCUs, 

respectively, in the OTR calculation. 

The NCUA evaluates the FICU controls 

over the third-party arrangement and 

the functional and operational risks 

associated with these third-party 

arrangements based on the specific 

services provided to the FICUs (such as 

accounting, lending, or governance). 

Æ The NCUA also budgets resource 

time to review the books, records, and 

internal controls of a sample of 

CUSOs.18 These reviews are captured 

under Principle 2 of the OTR 

calculation. The CUSO examination 

reports generated from these reviews 

serve as a resource to assist exam staff 

in conjunction with the normal 

examination process in their review of 

the CUSOs’ functional impact on FICUs. 

These reports also alleviate redundant 

effort, resources, and time among exam 

staff to perform these reviews at safety 

and soundness exams. 

• Because the NCUA does not charter 

FISCUs, the NCUA’s role with these 

institutions in the budget process is as 

their insurer. The NCUA budgets 

resource time to fulfill its insurance 

responsibilities for these FISCUs under 

Title II of the FCU Act, captured under 

Principle 2 of the OTR methodology. 

The NCUA’s top priority is to ensure 

a safe and sound credit union system. 

As the financial services industry and 

credit union risk landscape have 

evolved, the NCUA has improved the 

efficiency of its processes while 

maintaining a robust supervision 

program. One of the objectives of the 

NCUA’s 2016 Exam Flexibility Initiative 

was to improve coordination with state 

supervisors in the examination of 

FISCUs.19 This initiative provided a 

higher degree of reliance on the 

respective state prudential regulator to 

perform the regulatory oversight 

function for FISCUs, similar to the 

functions under Title I that the NCUA 

performs for FCUs. The Exam Flexibility 

Initiative extended the frequency of the 

NCUA’s onsite exam time to a 5-year 

interval for FISCUs that met the 

eligibility criteria. This initiative 

resulted in the NCUA budgeting 

reduced resource time for FISCUs as 

reflected in the following chart, with a 

progressive increase in time as FISCUs 

reached their 5-year interval. 

The following chart also shows the 

resource-budgeted hours for FCUs, 

FISCUs, and CUSOs for the past nine 

years. The chart shows that the NCUA 

has budgeted at least twice as much 

time for FCU exams as it does for FISCU 

exams by virtue of its dual role as 

regulator and insurer of FCUs versus its 

singular responsibility as insurer of 

FISCUs.20 Principle 1 (50 percent 

allocation) and Principle 2 (100 percent 

allocation) of the OTR calculation are 

then applied to this total resource time 

to determine how much total time in the 

chart is insurance related and, thus, 

fundable by a transfer from the Share 

Insurance Fund. 

3. Zero percent insurance-related— 

The NCUA’s Office of Credit Union 

Resources and Expansion (CURE) and 

Office of Consumer Financial Protection 

(OCFP) receive a zero percent 

insurance-related allocation as a starting 

point in the OTR methodology because 

the primary function of these offices is 

not insurance-related. 

• CURE supports credit union growth 

and development; provides support to 

low-income, minority, and any FICU 

seeking assistance with chartering; and 

processes charter conversion 

applications, bylaw amendments, and 

field of membership expansions. 

• OCFP’s primary function includes 

establishing consumer compliance 


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500,000 

400,000 

300,000 

200,000 

100,000 

2023 

Total Resource Budget Workload Hours 

2022 2021 2020 2019 2018 2017 

Ill Federal Credit Union Examination and Supervision 

II State Credit Union Exam and Supervision 

1111 CUSO and Third-party Vendor Reviews 

2016 2015 
88134 Federal Register / Vol. 88, No. 243 / Wednesday, December 20, 2023 / Notices 

21NCUA, ‘‘NCUA Budget and Supplementary 

Materials,’’ https://www.ncua.gov/About/Pages/ 

budget-strategic-planning/supplementarymaterials.aspx. 

22This means the percentage of actual expenses 

funded by the Share Insurance Fund as they are 

incurred each month. 

policies, programs, and rulemaking; 

serving as interagency liaison on 

consumer protection and compliance 

issues; conducting fair lending 

examinations; staffing the agency’s 

consumer call center; and providing 

financial literacy and outreach 

programs. 

Because the primary mission of both 

offices is not insurance-related, the OTR 

methodology assigns a zero percent 

insurance-related allocation for these 

offices as a starting point. However, a 

segment of each office’s responsibilities 

is related to insurance. For instance, 

applications for charter expansions 

involve risk to both FICUs and the Share 

Insurance Fund and drive a slightly 

higher allocation than the initial zero 

percent. OCFP responds to insurancerelated inquiries from credit union 

members and the public and this, in 

turn, drives a slightly higher allocation 

than the initial zero percent. Thus, each 

office tracks its insurance-related time 

and adjusts the zero percent allocation 

factor accordingly. 

It is important to distinguish between 

setting policy and programs for 

consumer compliance rules and 

regulations (performed by OCFP) and 

assessing a FICU’s compliance with 

consumer protection laws and 

regulations. The NCUA performs the 

latter along with the normal 

examination process, and the time for 

these reviews is factored into the 50 

percent allocation for FCUs and 100 

percent allocation for FISCUs as per 

Principles 1 and 2. The former, as 

discussed, is accounted for as per 

Principle 3. 

4. 100 percent insurance-related—The 

sole function of the NCUA’s Asset 

Management Assistance Center (AMAC) 

is insurance related. AMAC manages 

liquidation payouts and assets acquired 

from liquidations on behalf of the Share 

Insurance Fund, so its OTR allocation 

factor is 100 percent insurance related. 

The Board welcomes all comments 

regarding all aspects of the OTR 

methodology, but specifically invites 

comments on the four principles used to 

calculate the OTR discussed in the 

preceding paragraphs. 

Overhead Transfer Rate Methodology 

To calculate the OTR, the four 

principles outlined previously are 

applied to the activities and costs of the 

agency to arrive at the portion of the 

agency’s budget to be charged to the 

Share Insurance Fund. 

Step 1—Workload Program 

Annually, the NCUA develops a 

workload budget based on the NCUA’s 

examination and supervision program to 

execute the agency’s core mission. The 

workload budget reflects the needed 

time to examine and supervise FICUs, 

along with other related activities and, 

thus, the level of field staff needed to 

implement the exam program. Applying 

Principles 1, 2, and 3 (those relevant to 

the workload budget) to the applicable 

elements of the workload budget results 

in a composite rate that reflects the 

portion of the agency’s overall 

insurance-related mission program 

activities. 

Step 2—Annual Budget 

The annual budget represents the 

costs of the activities associated with 

achieving the strategic goals and 

objectives set forth in the NCUA’s 

Strategic Plan. The annual budget is 

based on agency priorities and 

initiatives that drive resulting resource 

needs and allocations. Information 

related to the NCUA’s budget process, 

including details on the Board-approved 

budgets, is available on the agency’s 

website.21

The agency achieves its primary 

mission through the examination and 

supervision program. The percentage of 

insurance-related workload hours 

derived from Step 1 represents the main 

allocation factor used in Step 2 and is 

applied to the budgets for the 

examination and supervision programs 

to calculate the insurance-related costs 

of the offices conducting field work 

(currently the NCUA’s three regional 

offices and the Office of National 

Examinations and Supervision, or 

ONES). As discussed in the Clarification 

of the Four Principles section earlier, a 

few agency offices (OCFP and CURE) 

have roles distinct enough to warrant 

their own allocation factors, which are 

developed by applying the four 

principles described previously to their 

respective activities. Each of these 

offices tracks its activities annually to 

determine their respective factors. These 

factors are then applied to the respective 

offices’ budgets to determine their 

insurance-related costs. 

A weighted average allocation factor, 

calculated by dividing the aggregate 

insurance-related costs for the regional 

offices and ONES conducting the 

examination and supervision program 

and the other agency offices with their 

own unique allocation factors by their 

aggregate total budgets, is applied to the 

remaining offices that design and 

oversee the examination and 

supervision program or support the 

agency’s overall operations. This factor 

is then applied to the aggregate budgets 

for the remaining offices (all other 

NCUA offices). As such, the proportion 

of insurance-related activities for the 

offices is based on a weighted factor of 

the other offices. The NCUA’s total 

insurance-related costs are calculated by 

summing the insurance cost calculated 

for the field offices, the offices with 

unique allocation factors, and the 

insurance cost for all other NCUA 

offices. 

Step 3—Calculate the OTR 

The OTR represents the percentage of 

the NCUA budget funded by a transfer 

from the Share Insurance Fund.22 The 

OTR is calculated by dividing the total 

insurance-related costs determined in 

Step 2 by the NCUA’s total annual 

budget. 

The chart below reflects the most 

recent NCUA Board-approved OTR used 

to fund a portion of the 2023 budget. 

Table 1 

OTR CALCULATION

Operating Costs to be Borne by the Share Insurance Fund .............................................................................................................. $221.9 

÷ Total Operating Budget .................................................................................................................................................................... $355.4 

= OTR .................................................................................................................................................................................................. 62.4% 


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23NCUA, Staff Draft 2023–2024 Budget 

Justification 50 (Sept. 29, 2022), https://ncua.gov/ 

files/publications/budget/budget-justificationproposed-2023-2024.pdf. 

24The NCUA included reference to this estimated 

cost savings in the Notice and Request for Comment 

dated June 30, 2017. ‘‘Based on the most recent 

Examination Time Survey results, field staff time 

would be reduced by approximately 200 hours 

annually. Central office and regional office staff 

time devoted to operating, maintaining, and 

administering the Examination Time Survey and 

related processes would be reduced by 

approximately 150 hours annually.’’ 82 FR 29943 

(June 30, 2017). 

Table 2 

Portion of Operating Budget Covered by: FCUs FISCUs 

FCU Operating Fee ................................................................................................................. 37.6% 0.0% 

OTR × Percent of Insured Shares ........................................................................................... 31.1% (62.4% × 49.9%) 31.3% (62.4% × 50.1%) 

Total .................................................................................................................................. 68.7% 31.3% 

Table 1 reflects the NCUA’s annual 

budget of $355.4 million for the 2023 

budget year. The FCU Act authorizes a 

portion of the NCUA’s budget to be 

funded through a requisition from the 

Share Insurance Fund (OTR 62.4 

percent), while the remaining 37.6 

percent will be charged to FCUs as an 

operating fee in 2023. 

The industry has voiced concern 

about the NCUA’s presentation of the 

OTR in the annual budget posted to the 

agency’s website because it believes the 

current footnoted reference to the 

regulatory fees that FISCUs pay their 

respective prudential regulator is 

insufficient.23 The NCUA’s intention in 

presenting the distribution of the 

operating budget costs in this request for 

comment is to clarify how the NCUA 

funds its annual operations between (1) 

requisition from the Share Insurance 

Fund and (2) operating fees paid by 

FCUs. 

The NCUA does not intend to 

discount the fact that FISCUs also pay 

a regulatory fee to their respective 

regulators. In presenting this 

information, the agency welcomes the 

industry’s feedback on the current 

method. 

Commenters also noted that the 

current cost distribution table (Table 2) 

uses insured shares to reflect the 

distribution of the OTR among FCUs 

versus FISCUs, and while total insured 

shares are relatively equal among 

charter type, there are fewer FISCUs 

than there are FCUs. 

First, the NCUA would like to clarify 

the requisition from the Share Insurance 

Fund is not allocated based on charter 

type. The current cost distribution table 

is for informational purposes only and 

is used to show how the portion of the 

NCUA’s budget funded by the Share 

Insurance Fund would be broken down 

among charter types. The NCUA shows 

this breakdown using insured shares to 

reflect that FICUs’ economic interest in 

the insurance fund is pro-rata based on 

insured shares. 

The NCUA Board welcomes comment 

on alternative ways to present this 

information publicly. 

Request for Comment on the OTR 

Methodology 

The principles-based OTR 

methodology has streamlined the OTR 

calculation process and has reduced the 

needed resources to gather the costcenter time allocation used in the 

calculation.24 It has also made the OTR 

easier for stakeholders to understand. 

The methodology additionally has led to 

reduced variability in the calculated 

OTR each year. 

The added detail, transparency, and 

clarifying statements in this request for 

comment aim to address the industry 

interest regarding transparency and 

improved understanding of the 

allocation of insurance-related expenses 

among charter types. The Board 

welcomes comment on all aspects of the 

OTR methodology—including on the 

four principles, added detail, and 

clarifying statements discussed in this 

request for comment—as well as any 

suggested alternatives. 

The Board is also particularly 

interested in comments on whether it 

should continue to publish a dedicated 

notice requesting comment on the OTR 

methodology every 3 years. 

Alternatively, in circumstances when 

the Board does not intend to make 

changes to the OTR methodology, the 

NCUA could ask for comments on the 

OTR methodology triennially along with 

its long-standing one-third regulatory 

review process; rely on the public’s 

opportunity to request action under 12 

CFR 790.3 or petition the Board for 

changes under § 791.8(c); or a 

combination of these opportunities. The 

Board also now annually publishes, 

requests comments on, and holds a 

public hearing on its budget. These 

comments and hearing, in turn, provide 

further opportunity for individuals to 

comment on the OTR methodology as 

part of the budgeting process. While the 

specific triennial process dedicated to 

the OTR has served well over the last 

number of years, the Board requests 

input on whether another process may 

prove more efficient and save resources 

for both credit unions and the NCUA 

while still maintaining transparency on 

the OTR methodology. Whenever the 

Board considers any changes to the OTR 

methodology, it would continue to seek 

comment through a Federal Register 

notice specific to the OTR. 

By the National Credit Union 

Administration Board on December 14, 2023. 

Melane Conyers-Ausbrooks, 

Secretary of the Board. 

[FR Doc. 2023–28000 Filed 12–19–23; 8:45 am] 

BILLING CODE 7535–01–P 

NATIONAL FOUNDATION ON THE 

ARTS AND THE HUMANITIES 

Institute of Museum and Library 

Services 

Notice of Proposed Information 

Collection Requests: Museums for All 

Program Evaluation 

AGENCY: Institute of Museum and 

Library Services, National Foundation 

on the Arts and the Humanities. 

ACTION: Notice, request for comments, 

collection of information. 

SUMMARY: The Institute of Museum and 

Library Services (IMLS), as part of its 

continuing effort to reduce paperwork 

and respondent burden, conducts a 

preclearance consultation program to 

provide the general public and Federal 

agencies with an opportunity to 

comment on proposed and/or 

continuing collections of information in 

accordance with the Paperwork 

Reduction Act. This pre-clearance 

consultation program helps to ensure 

that requested data can be provided in 

the desired format, reporting burden 

(time and financial resources) is 

minimized, collection instruments are 

clearly understood, and the impact of 

collection requirements on respondents 

can be properly assessed. The purpose 

of this Notice is to solicit comments 

concerning the proposed IMLS study of 

the impacts of the IMLS Museums for 

All Initiative. A copy of the proposed 

information collection request can be 


ddrumheller on DSK120RN23PROD with NOTICES1