By the end of 2019, federal credit unions will have another option for updating your bylaws. NCUA recently approved a new version that adds flexibility for the credit union and board and transparency for members as it incorporates several legal opinions into the bylaws. The NCUA Board made it clear that members should be given as much opportunity to participate in their credit union’s democratic process as possible and, despite comments to the contrary, the Board does not support limiting membership meetings and voting to online only. It wants all members, including those with no access to the internet or who live in areas of poor broadband, to have participation options. The NCUA Board also expressed strong expectations that a copy of the bylaws should be posted on a credit union’s website (behind password protection is acceptable) and that annual meeting notice be expanded from just the lobby to include websites and online channels the credit union uses.

Other changes to note are

• expanded verbiage to define a ‘member in good standing’ and provide the credit union with clear authority to take immediate action to limit services for violent, disruptive, or threatening behavior;
• varying par values for different groups of members (i.e. students, minors, non-naturalized? persons);
• expanded direction on the role of nominating committees to present candidates to fill committee openings;
• options for member meetings and voting by electronic means and mail;
• minimum age selections for both voting and holding elected office;
• encouragement to increase the diversity of board members to match the membership;
• clarification on a loan applicant’s ability to have the board review denied loans (if no credit committee);
• inclusion of both director emeritus and associate director positions, if desired;
• expanded explanation of the member expulsion process;
• commentary on membership as it relates to revocable and irrevocable trusts; and
• notice to members of a change in the size of the credit union board.

Federal credit unions will have the ability to review and adopt some or all of the new options with a 2/3 vote of the credit union’s board. If a credit union chooses to ask NCUA for a bylaw provision that is not part of the standard bylaw, the process to make application to the NCUA CURE office is outlined in the rule. It includes timelines for response by CURE and expectations for additional information. More information is expected later this fall. My hope is that NCUA also includes a template on their website.