Credit Unions Flexed Political Muscles in '04 With Growing Support of CURIA, Tax Exemption
WASHINGTON-Lawmakers lined up in droves to support credit union legislative issues this year. Through perseverance and lots of shoe leather, credit union lobbyists worked hard to ensure support for crucial legislative efforts in 2004. The fruits of their labor were abundant. Numerous lawmakers, including Senate Banking Committee Chairman Richard Shelby...
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WASHINGTON-Lawmakers lined up in droves to support credit union legislative issues this year. Through perseverance and lots of shoe leather, credit union lobbyists worked hard to ensure support for crucial legislative efforts in 2004. The fruits of their labor were abundant. Numerous lawmakers, including Senate Banking Committee Chairman Richard Shelby (R-Ala.), House Majority Leader Tom Delay (R-Texas), and 16 of the 17 member congressional delegation from Michigan-including House Ways and Means Committee Members Dave Camp (R) and Sander Levin (D)- came out in support of the tax exemption. CUNA obtained a letter from President George W. Bush in support of credit unions’ tax-exempt status and Treasury Secretary John Snow has trumpeted the issue, as has Assistant Secretary Wayne Abernathy. During his presidential campaign, Senator John Kerry (D-Mass.) also wrote in support of the credit union tax exemption. More recently, Senator Kay Bailey Hutchison (R-Texas) wrote Texas Credit Union League President and CEO Dick Ensweiler in favor of shielding credit unions from the federal income tax. On the other hand, House Ways and Means Committee Chairman Bill Thomas (R-Calif.) announced that he would be looking into whether certain non-profits still held the societal value to maintain their tax exemptions. He specifically noted credit unions and hospitals as possible subjects of hearings. A series of hearings started this year, but credit unions have yet to surface. And, Federal Deposit Insurance Corporation Chairman Don Powell, a former community banker, has spoken out in opposition of the credit union tax exemption. Credit union groups have been quick to point out to him that this defies the rest of the administration’s position and asked him to pipe down. Credit union lobbyists were pleased but not surprised at the support the Credit Union Regulatory Improvements Act (H.R. 3579) received in its first full year before the House. The bill, which encompasses several regulatory relief measures and improvements, has received the signatures of 69 members of the House of Representatives, including main sponsors House Financial Services Committee Members Ed Royce (R-Calif.), Paul Kanjorski (D-Pa.), Steven LaTourette (R-Ohio), and Carolyn Maloney (D-N.Y.). The bill includes most of the credit union provisions in the Financial Services Regulatory Relief Act (H.R. 1375) such as expanded investment powers, extend loan maturity limits, and allows credit unions to offer wire transfer services and check cashing to anyone within their fields of membership. In addition, it would expand credit union member business lending by raising the cap to 20% and amending the definition of a business loan by increasing the minimum loan amount from $50,000 to $100,000. CURIA would also establish a risk-based capital system for credit unions and permit credit unions to lease excess office space in underserved areas without running into trouble with NCUA’s fixed asset cap. CURIA has caused the banking trade associations to rise up in revolt and they are urging their members to write their congressmen in opposition to H.R. 3579. -
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