Since before the turn of the century credit unions have beenlooking for a legislative win. Something that will not only improveour charter but also show that we can get proactive legislationpassed. With the proposed MBL bill, we had the perfect legislationat the perfect time. We pulled out all the stops, lined up oursupport and were promised a vote before the 112th Congressadjourned on Dec. 31, 2012. 

 Well, we're on to the 113thCongress without a new lawor even a vote on MBL. Even worse, we are now faced with yetanother fiscal showdown over the debt ceiling that has given thebankers the opportunity to bring our tax-exempt status into thefray. Of course, we've been assured that credit union taxation isoff the table. But, depending on who you listen to, so is Medicare,Social Security, defense spending, Grover Norquist's pledge, NRAcommon sense and expanded replay in baseball. Think they're allsafe? How bout at the state level?

Our failure on MBL and the re-emergence of the tax debate hasled to much frustration in many circles of the credit unioncommunity. The consensus is that we've put a great deal of effortand money into this battle and have achieved no meaningful results.In fact, we seem to be slipping backwards. The discussion turnsquickly from, How did we lose this one? to What are we going to dodifferently going forward to change the result? Meanwhile, bothCUNA and NAFCU have emphasized that they are focused on preservingour tax exemption. But they don't appear to be prepared for anotherrun at any meaningful legislative initiatives. And even if theydid, it's hard to imagine that we'll be any more successful than wehave been without some radical changes in substance andapproach. 

While serving on the CUNA executive committee for six years, Iobserved firsthand how poorly CUNA and NAFCU cooperate. It was, andremains, apparent that two organizations competing against eachother for the same members simply can't be expected to trust eachother. Without trust, effective coordination and compromise areimpossible. As a result, the credit union community is wastingprecious resources at a time when we have an incredible opportunityto help more consumers than ever before. It's time to overhaul thetrade association structure as it exists today. 

Start with things that CUNA (strong local presence, highvisibility on Capitol Hill and in many statehouses and a prominentPAC) and NAFCU (good at public relations, compliance and strongdirect communication with credit unions) do well. Redesign thecurrent CUNA/league structure to improve accountability, eliminateduplication and reduce competition between the state and nationalassociations and between state associations. Make sure issues arevetted appropriately and speak with one, strong voice at thenational level with full support from the state and local level. Iunderstand that this is a huge task. The internal defense systemsare powerful and highly resistant to change. Longstandingprinciples stand in the way. There are deep resentments that wouldhave to be overcome. In fact, this sounds a lot like the fiscalcliff debate that we're all fed up with and a familiar questionarises. Are we finally ready to go after a real fix or do we justkick the can down the road again?

Speaking of radical change, here's another thought, Since ourtax exemption is, once again, under attack, maybe we do what no oneelse in Washington seems willing to do. Let's think about aproactive approach that really does take the issue off the table.Let's propose a tax plan for credit unions. This idea has beenfloated privately and in small groups on occasion. 

The plan created an option for those credit unions that wishedto have expanded charter options, including open fields ofmembership, no MBL cap and access to secondary capital. Thetradeoff would be taxation if the credit union's net worth exceededa reasonable level. The plan, while thoughtful and praised by many,was never seriously considered mainly due to fear, fear that itwould split the credit union community and fear that once you startmoving down the path of negotiating taxation you would lose controlof the issue and get a bad deal. 

And back to the issue of our trade association structure, how doyou think NAFCU would react if word got out that CUNA was havingmeaningful discussions about such a plan (orvice-versa)? 

Don't get me wrong, we can probably continue to getby.  We should be able to block taxation and could evenhave a few more moral victories like the TAG defeat. We lostsomething, but the banks lost more.   Maybe we'llhave another perfect opportunity and maybe this time there will besomething that the banks really are willing to trade so our“friends” in Congress can bring themselves to actually vote on abill.  Sound like a plan?  Well, until we'reprepared to engage in some serious debate about meaningful changes,however controversial or uncomfortable they are, that seems to beall we've got.

Tom Dorety is CEO of Suncoast Schools FCU, Tampa,Fla.
Contact 813-621-7511 [email protected]