In its latest letter to federal credit unions, the National Credit Union Administration announced that the relief measures pertaining to annual meeting flexibility issued last year because of COVID-19 will also be applicable in 2021. The measures providing flexibility for annual and special meetings also now extend to regular meetings of the credit union’s board of directors.
For credit unions to take advantage of the relief measures for virtual annual meetings without an in-person quorum requirement for the upcoming 2021 year, a federal credit union will need to adopt an Article IV bylaw amendment by a two-thirds vote of its board of directors (with no additional approval from the NCUA).
The language for the amendment is provided in the NCUA’s letter to federal credit unions, #20-FCU-04. The language for regular meetings of the credit union’s board of directors is optional; if the credit union only wants the language to apply to annual/special meetings, then they would omit the underlined language from the amendment when presented to the board for the two-thirds vote.
Once the amendment is adopted, federal credit unions can choose to invoke the provision at any time in 2021, if the majority of their board of directors chooses to do so for such meetings.
Because of President Trump’s national emergency proclamation on March 13, effective immediately, a federal credit union may adopt by a two-thirds vote of its board of directors a bylaw amendment to Article IV without undergoing further bylaw approval processes with the NCUA.
FCUs that choose to adopt this amendment should ensure that the cross-citations conform to their version of the bylaws. The bylaw amendment should read as follows:
Section 6. Emergency exception to in-person quorum requirement. This credit union may hold its annual meeting of the members and special member meetings for authorized purposes other than member expulsion under Article XIV of these bylaws, virtually,1 and without an in-person quorum if all the following conditions apply and are certified in meeting minutes by a resolution of the majority of a quorum of the board of directors:
- At least one of the following is located in an area where a federal, state, or local authority has declared a state of emergency or major disaster:
a. All or part of a community the credit union serves; or
b. The credit union’s headquarters.
- 2. The credit union has the technological capacity to facilitate virtual meeting attendance, voting, and participation.
- 3. Members receive at least seven days’ advance notice of the change to a virtual meeting format and appropriate instructions for how to join, participate, and vote during the virtual meeting.
- 4. The NCUA has issued general or specific guidance notifying the credit union that it is appropriate to invoke this bylaw provision.
If credit unions adopt this bylaw amendment, the NCUA says it is appropriate to invoke its provisions at any point during the year for meetings occurring in 2021, if a majority of the board of directors so resolves for each such meeting. General quorum requirements must still be met for all-virtual meetings.
Read more of the NCUA’s guidance about annual meeting requirements and flexibility.
