ALEXANDRIA, Va.-In July, the NCUA announced that it would be holding its first ever, public budget hearing, which was held November 1. The credit union community praised the hearing as a step toward more openness about the agency's budget, which is funded by federal credit unions and indirectly by federally insured, state chartered credit unions through the insurance fund. In the past, credit unions were concerned as to how their funds were being used at the agency, which had never allowed for specific public comment prior to the board's decision. The board eventually approved the $147 million budget for 2002 that it had presented during the hearing. It also approved a projected budget decrease for 2003 to $145.6 million, or nearly 1% of the 2002 budget. Much of the budget increase went toward staff pay raises. NCUA also announced that it planned to eliminate 33.55 full time equivalent positions through attrition in 2002. In discussing the budget, the overhead transfer rate (OTR) was sure to creep into the conversation. Last year, NCUA placed the OTR at 66.72% and said an outside study would be performed. Following the study by accounting firm Deloitte and Touche, NCUA said it would incorporate some if not all of the suggestions made and lowered the OTR to 62% for 2002 and 2003. This decision led the agency to raise the operating fee for federal credit unions by 4.36%, which did not draw much surprise or criticism from federal credit unions. In 2000, the fee had been cut more than 20% because of the increased OTR from the historic 50%.