In apparent fallout from Bank Transfer Day furor, Seattle City Council is exploring moving its public funds from banks to credit unions, though such future transactions would require clearing some legal hurdles.
In a 12-part resolution adopted last Monday, the council said it “will review its banking and investment practices to ensure that public funds are invested in responsible financial institutions that support our community.”
The resolution was sponsored by Councilmen Nick Licata and Mike O’Brien, both of whom reportedly announced on Bank Transfer Day that they were joining credit unions.
The Northwest Credit Union Association said that while it welcomed the resolution the state legislature would still have to enact a bill allowing CUs to hold funds at deposit insurance levels.
Based on the roadblocks and other factors, no Seattle CU has come forward so far in pressing the case to start accepting the funds, said Mark Minickiello, vice president of legislative affairs for the NWCUA.
Minickiello said, however, the resolution does “present opportunities for partnership on common issues before the state legislature in 2012.”
“The resolution ties the city of Seattle to issues of public funds and member business lending – two issues that credit unions have an interest in,” he said.