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ALEXANDRIA, Va.-The NCUA Board last week at its monthly board meeting issued a proposal to permit student-owned and controlled credit unions to apply for funds from the Community Development Revolving Loan Fund Program. The Campus Credit Union Council raised the issue with NCUA after CCUC Executive Director Gillian Coulter discussed it with a former board member of Skidmore Students Federal Credit Union. In a letter to NCUA Chairman Dennis Dollar, she wrote, “Traditionally, these funds have been reserved for low-income designated credit unions, and while student-owned and controlled credit unions are included in this designation – they have been ineligible from receiving said funds by NCUA regulations. However, the current operating climate has changed significantly since these restrictions were imposed.” Coulter pointed out that these very students are the future of the credit union movement and they should not be restricted. The number of student-owned and controlled credit unions, which are included in the low-income designation and are typically defined as having 51% or more control of the board, according to Coulter, is down from 120 in 1985 to seven currently. The CDRLF received a large infusion of cash this fiscal year totaling $1.2 million, up from $1 million last year, but the biggest difference is the money earmarked for technical assistance grants jumped from about $350,000 to $1 million. But the CDRLF may be evolving into a scene for a turf war. The National Federation of Community Development Credit Unions has written against NCUA’s proposal. NFCDCU Executive Director Cliff Rosenthal explained in a letter to Chairman Dollar that the CDRLF’s “purpose was, and remains, supporting credit unions that alleviate poverty within low-income communities. To include student-run credit unions simply because NCUA chose to classify them as low-income in the mid-1980s clearly contradicts the spirit and intent of the CDRLF.” He continued, “The fact that there is money available within the CDRLF does not argue for expanding these limited funds for a purpose other than that envisioned by Congress. The fact that the number of student-run credit unions has declined to only seven does not justify diluting-even if only by “a little”-the impact of the CDRLF by expanding eligibility to another type of institution.” Rosenthal offered to help come up with a creative way of disbursing the funds if NCUA was having trouble. Coulter asked that if CCUC waits a few years for congressional action to appropriate funds specifically for student-owned and controlled credit unions, how many will be left? “We don’t think the restrictions will be lifted in time for this deadline [to apply], so we’re hoping for this for next year,” she said in an interview. The technical assistance grants must be awarded by Sept. 30, 2004. Coulter said she knows of at least two student-owned and controlled credit unions that are interested in applying for money from the CDRLF. [email protected]

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