SALT LAKE CITY — When Utah legislators meet next year, Utah credit unions will be ready to present their case again for allowing more flexibility in offering members business loans.

In 2003, the Utah Bankers Association was able to persuade lawmakers to put a $250,000 limit on business loans offered by state-chartered credit unions and restrict a certain percentage of assets the total amount of loans issued. Under NCUA's member business lending rule, federal credit unions have some leeway in that only business loans of more than $50,000 are counted as part of their business lending portfolio. Utah's state-chartered credit unions must count all business loans, regardless of amount, toward the total amount they can offer.

In 2003, Utah's bankers pressed legislators to restrict credit union business lending. Jim Anderson, chairman of the Utah Bankers Association and president of Bank of Utah, told the Tribune "It is usually only the larger credit unions that work hard to compete with banks on business loans." "Given that they have a 40 percent tax advantage [because of credit union's nonprofit status] we don't consider the competition fair," Anderson said. The publication quoted $28 million Moroni Feed Credit Union President Ilene Rollo who said business lending restrictions have hit small credit unions in rural areas particularly hard. Moroni is in the process of converting to federal and hopes to become an FCU by year end, she pointed out. "If we were a federally chartered credit union we would only have 10 business loans on our books" and would still have money to lend, Rollo said. "As a state-charted credit union we're maxed out."