WASHINGTON- After almost 40 years of not having a state credit union charter, the Washington, D.C. Department of Banking and Financial Institutions might once again be able to charter credit unions. A hearing has been scheduled for Nov. 28 on a bill introduced by the Washington, D.C. Department of Banking and Financial Institutions to allow for a D.C. credit union charter. The ability for District chartered credit unions was repealed back in 1964, according to CUNA Vice President of State Government Affairs Colleen Kelly, and, therefore, all 80 D.C. credit unions are currently federal charters. As to why the former D.C. Credit Union Act was repealed, information is sketchy. An article in the September 1964 edition of Credit Union Magazine said the D.C. League had requested the repeal and asked that the 16 D.C. state-chartered credit unions at the time come under the regulation of the Federal Credit Union Act. According to the October 1964 bulletin of the Bureau of Federal Credit Unions (NCUA’s predecessor), the BFCU ordered the 16 credit unions to convert to federal charters or be liquidated. Kelly said she was approached by Charles Lowery, assistant general counsel for the Department of Banking and Financial Institutions a couple of years ago. Kelly said he was curious as to why there was no D.C. Credit Union Charter Act and said the Department of BFI was interested in there being one. He thought credit unions would be ideal financial institutions for many of the neighborhoods in D.C., Kelly recalled. Lowery asked Kelly’s help in drafting a credit union bill. Kelly said she showed Lowery a draft of the revised Model Credit Union Act that the CUNA Model Credit Union Act Taskforce is in the process of finalizing. The taskforce hopes to have the new Model Credit Union Act finalized in time for GAC 2002. At press time, Kelly said the taskforce had finalized up to chapter 10 of the new act – there are 14 chapters. Although Lowery customized some portions of the Model Credit Union Act to make it suitable for D.C. purposes, Kelly said, “The D.C. credit union act is the first credit union act that is based on the new Model Credit Union Act.” She estimated that about 90% of the D.C. Credit Union Act mirrors the Model Credit Union Act. “Just because it’s a Model Credit Union Act doesn’t make it right for every state,” said Kelly. Kelly said she’d gone through the D.C. Credit Union Act with a fine tooth comb and highlighted the areas she noted it deviates from CUNA’s Model Credit Union Act – and where it doesn’t “because they chose not to,” she said. In places where the department didn’t have the new Model Credit Union Act to refer to because of its incompleteness, Kelly said she discerned the department had referred to the 1986 Model Credit Union Act At press time, Kelly intended to send copies of the D.C. Credit Union Act to members of the CUNA Model Credit Union Act Taskforce on Nov, 19, as well as to the D.C. Credit Union League’s Credit Union Act Taskforce headed by Robert Hess, president/CEO, Wright-Pattman Congressional FCU, Oakton, Va. The D.C. Credit Union League has had a management agreement with the Virginia League for the past three years. The D.C. League however remains a separate entity. When the D.C. Credit Union Act passes, it will take effect following approval by the mayor (or in the event of his veto by the City Council), by the Financial Responsibility and Management Assistance Authority, a 30-day period of Congressional review, and publication in the District of Columbia Register. – [email protected]

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