ALEXANDRIA, Va.-NCUA Acting Chairman Dennis Dollar said that the agency was planning on cutting its budget by more than $2 million at the upcoming July board meeting. Dollar said that all three NCUA Board members have been briefed on the $2,183,000, or 1.55%, budget cut. The reduction brings the entire NCUA budget down from $140,568,580 to $138,385,580. Some funding was also reallocated. "The primary reason for the reduction is personnel cost," the chairman explained. He said employees either leave or retire and it takes time to refill their positions. This cut should definitely positively impact next year's budget decisions, Dollar indicated. "Any savings from what you have.is already available to you next year," he said. While reducing its budget, other matters, such as the incidental powers rule and the Credit Union Service Organization (CUSO) rule, are being expanded. Through the new incidental powers rule expected to be approved at the next board meeting, credit unions will be able to broaden their services into areas formerly reserved for CUSOs and receive compensation for it. "I don't think it will adversely affect the role of CUSOs at all," Dollar said. Not only do the CUSOs allow credit unions the benefits of economies of scale, they also permit credit unions to indirectly serve nonmembers, he emphasized. Additionally, CUSOs will be provided new opportunities with the CUSO reg expected to pass in July. While not technically expanding their powers, the rule will provide CUSOs broad categories of permissible activities rather than a laundry list. Dollar noted that the two regulations were not piggybacked. "Both [regulations] need to be updated from time to time to keep up with where the market is going," he said. Another hot button issue on the agenda is a proposal to permit credit unions to reimburse board members for travel companions other than their spouses. According to Dollar, "NCUA should not be deciding whether a credit union should authorize a board member to bring a grandson rather than a spouse." He stressed that if travel expenses appear to be getting too out of line at a credit union, NCUA always has the option of checking up on the matter. Dollar said that he did not feel this move was a step toward compensation of board members, but simply an acknowledgement that credit union board members may not attend some of the necessary training without incentive, such as bringing a travel companion. He said that no analysis was completed to compare credit union board member reimbursement to that of banks, but said he was sure credit unions were not as generous. Also expected on the board agenda is the flexible examination schedule proposal. Dollar said the cost savings estimates concerning the proposal will be available at the board meeting as well as the number of credit unions that could be impacted. He added that the estimates will be presented as ranges because part of the proposed regulation will depend on examiner discretion. Board meeting attendees can also expect some housekeeping issues to surface as well as the customary community charter conversions. Dollar said that though many of the issues to be addressed at the board meeting are significant, they are not necessarily "contentious." The chairman's sense is that the board members are in agreement on the core issues, while some of the "peripheral issues will be hammered out before the board meeting." [email protected]