Even after news that a vote on S. 2231 won’t happen as quickly as hoped, credit union trade associations say they aren’t pursuing a Plan B to promote legislation that would raise the member business lending cap to 27.5% of assets.
Passing legislation is a process, not an event, stressed NAFCU President/CEO Fred Becker. Credit unions must remain unrelenting in their support of this legislation, he said, and not give up or walk away.
“That’s exactly what bankers want, for us to get discouraged and go away, and if we do that, we’re playing right into their hands,” Becker said.
The NAFCU chief said he’s not surprised senators appear to be avoiding a vote on business lending, saying, “It’s no shock to anybody in Washington because it pits bankers against credit unions.”
Both the banking and credit union lobbies are important to Congress, he said, and elected officials want to avoid alienating one group in favor of the other, particularly in an election year.
CUNA Senior Vice President of Legislative Affairs Ryan Donovan said his team has not changed strategy on businesss lending “because there is nothing there that would have prompted us to change strategy. It continues to be what it has been.”
Sen. Tim Johnson (D-S.D.) was among the first to publicly sidestep the business lending legislation when he called it “a controversial matter” on the Senate floor March 19.
Johnson, who is not a co-sponsor of S. 2231, was speaking in favor of his amendment to the Jumpstart Our Business Startups Act, which would have reauthorized the Import-Export Bank. During his allotted time, Johnson addressed Sen. Mark Udall’s (D-Colo.) attempt to attach credit union member business lending legislation to the JOBS Act.
“As chairman of the Banking Committee, I held a hearing on this issue last June, and as my staff and I have told the leader and his staff since then, this is a very controversial matter. From the testimony of the credit union and banking industry witnesses at that hearing and the ongoing conversations over the past months, it is clear there is no consensus,” Johnson said. “If the Senate chooses to move forward on this issue, I urge the Senate to move forward carefully.”
When asked if he thought Sen. Johnson’s comments may have influenced other senators to avoid a vote on S. 2231, Senate Banking Committee spokesman Sean Oblack sidestepped the question, saying, “On March 15th on the Senate floor, Majority Leader Reid committed to voting on member business lending. We are not aware that there has been a change.”
S. 2231 sponsor Udall said he still believes his bill will come to a vote this year.
“Sen. Reid has promised a vote on this bill, and I’m committed to making that vote happen,” Udall said. “There is a busy Senate calendar this year, as I understand Sen. Schumer–a co-sponsor of the bill–was pointing out, but this will come to the floor for a vote.”
When asked if Udall would sponsor member business lending legislation again next year should it not receive a vote in 2012, Udall Deputy Press Secretary Alex McCarthy said, “Sen. Udall’s goal is to allow credit unions to help increase access to capital for small businesses as quickly as possible, so for now his focus is on this year, not the next.”
Sen. Charles Schumer (D-N.Y.) was quoted by American Banker April 23 telling a banking contingency that vote on S. 2231 wouldn’t happen until at least the second half of the year.
However, the Credit Union Association of New York’s Mike Lanotte, senior vice president of association services and general counsel, said Schumer is still “100%” in the credit union corner.
“We do not have any concerns with his support for the bill,” Lanotte said. “He’s reinforced his commitment to legislation, he’s been true champion on this for us, and we have no doubt he will continue to do so.”
Jeremy Empol, director of federal governmental affairs for the California and Nevada Credit Union Leagues, said Senate Majority Leader Harry Reid won’t introduce a vote on the business lending bill on a whim.
“He has to make sure it has the votes, and all his caucus members are taken care of and have no concerns,” Empol said, adding, “He’s in the process of doing that now.”