<p>WASHINGTON – CUNA's Project Differentiation, the effort encouraging credit unions to document the ways they serve their members, is either a practical way for credit unions to measure and understand their services or a "well intentioned" but insufficient approach to forestalling any CAP like requirements. Or both. It depends on whom you ask. For Richard Gose, CUNA's Vice President of Political Action and Grassroots, Project Differentiation can lead a credit union through an introspective exercise which will let them better see and understand their current membership activity. "What we find among many credit unions who complete a Statement of Commitment is that it opens their eyes to all that they are doing already and just don't know it," Gose said. "You can be so busy with all your work serving members that you can lose sight what all it is that you actually accomplish on their behalf." A credit union taking part in the program draft what is called a "Statement of Commitment," a document which lays out the credit unions basic philosophy of service to its members and then provides six categories in which to list its specific activities. The six are service to members, member education, involvement/governance, diversity, commitment to the credit union movement and public service/corporate citizenship. The six categories and the template for the statement of commitment were the brainchild of committee of credit union CEOs, CFOs, credit union educators and board members. Interestingly no regulators were asked to contribute to the committee and both Gose and Gretchen Graf, project coordinator, seem shocked that anyone might suggest that a regulator might have a perspective to share. "This is really meant to help credit unions internally," Graf said. Depending on the size and complexity of the credit union, statements of commitment can be of only a few pages to sometimes more than 20, and Gose said that 982 have finished the program in its three-year history. By the time of the GAC, Gose hopes for 1,000 completions. Completing a Statement thoroughly represents a significant commitment of time and resources. Graf reports that the program really began to take off in terms of completions only after CUNA got the leagues involved, many of whom coordinate credit union Project Differentiation activities to help manage the time and resource commitment. One league tackles one section of the Statement each month, while another goes from credit union to credit union offering intense help in one session. What the credit union does with the information it gleans from its Statement of Commitment is up to the institution, Gose said and runs the gamut from sending the finished form to CUNA for placement on its Web site, to sharing it primarily with members, to keeping it among the staff and Board members. CUNA does not require that a credit union send in the completed statement or share it with anyone, although Gose admits it has potential for collecting credit union data once more credit unions take part. But the recent controversies over the CAP repeal and allegations that credit unions do not sufficiently serve low income and underserved communalities appear to be moving Project Differentiation more sharply into the public and political spotlight. For the first time CUNA has specifically asked credit unions who have completed the Statement to bring it with them to Washington to show to their members of Congress and CUNA has referenced the Project in its February 19 comment letter supporting the CAP repeal. "CUNA has called upon state and federal credit unions to document their service to their entire fields of membership, including those with the greatest financial needs, through Project Differentiation," CUNA wrote. "This program allows credit unions to assess how well they are meeting their members' needs and focus on areas of achievement as well as identify marketing opportunities and other service initiatives." But it's in this new arena, where CUNA seems to be gathering the program to be more than an introspective or strategic exercise, that its critics say its worth begins to break down. Clifford Rosenthal, Executive Director of the National Federation of Community Development Credit Unions (NFCDCU) said the Federation doesn't advise its members to complete or not to complete the Statement, but that the Statements should not be seen as a substitute for systemic credit union accountability. "Credit unions need to understand that we will be held accountable for how we serve low income and underserved communities," Rosenthal said. He pointed out that Project Differentiation had no specific questions about how a credit union serves low income members, leaving the topic to be included in lists of how credit unions serve their members overall. The problem with that approach, Rosenthal suggested, is that serving low income and underserved communities can get lost in all the work credit unions do unless a credit union makes a specific effort to single out the area for heightened attention. David Berenbaum, Senior Vice President with the National Community Reinvestment Coalition (NCRC) called the effort "well intentioned" but that the Statements of Commitment went far beyond what CAP required. "It might be very useful for a credit union to examine how it conducts its diversity program," Berenbaum noted, "but that doesn't answer the question about how it serves low income communities." Berenbaum pointed out that in an ideal situation, a credit union could solicit community participation in formulating its plan to serve the community, maintaining that fulfilling a CAP-type exercise would be outwardly, rather than inwardly focused. He maintained that banks which have "taken CRA into their culture" have found it not to be an odious regulatory burden but of assistance in reaching out for more business, an assertion that a source at the American Bankers Association backed up "generally." "I don't think any banks go out and find business because of CRA," the source said, "but I know banks have found a useful nexus between making good loans and making loans that have a CRA benefit," he said.</p>