NCUA: CU Boards have some meeting, election flexibility
ALEXANDRIA, Va. (1/18/06)— Federal credit unions (FCUs) affected by Hurricane Katrina should find that existing bylaws for director and member meetings provide sufficient flexibility to cover the challenges these credit unions are facing, according to a recent opinion letter signed by Associate General Counsel Sheila Albin of the National Credit Union Administration (NCUA).
The NCUA letter was in reponse to a request by Anne Cochran, president/CEO, Louisisana Credit Union League (LCUL), for guidance on procedures for board meetings and member elections for federal credit unions affected by Hurricane Katrina.
The NCUA attorney wrote that standard federal credit union bylaws require only one face-to-face board of directors meeting per year, and that all other meetings may be conducted by video- or teleconference. Further, the one in-person meeting requires the actual presences of only a quorum of directors and allows absent directors to participate by video- or teleconference.
Albin also noted that credit union boards may act without a meeting, if a vote is unanimous and each board member's position is documented in writing—even electronically.
"We also note that the standard FCU bylaws permit directors to appoint temporary directors and supervisory and credit committee members to serve in place of those who may need to step aside," the NCUA opinion letter said.
For notices of member meetings and elections, Albin recommended that a credit union should follow its usual procedure and send out information to a member's last address of record, noting that bylaws make members responsible for notifying their credit union of address changes.
"Nevertheless, we note that some of the addresses an FCU may have on record may no longer exist because of hurricane damage, but members may have provided the U.S. Postal Service with forwarding instructions," Albin wrote.
The agency letter says there are four options in FCU bylaws for conducting elections and if a credit union's board or management determines another option would be better, they may amend their bylaws with a two-thirds vote by directors.
The one area that the LCUL inquired about that does not offer any flexibility is that of proxy votes. Proxy votes are prohibited by FCU bylaws.
"In any event, since voting by proxy would still require an FCU to contact the member and receiving the member's written proxy, proxy voting would not save any time or effort as a practical matter as far as contacting members," Albin advised.
Use the link below to read the full NCUA opinion letter.
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