The Positive Story of Credit Unions Needs To be Told More

I appreciated Editor-in-Chief Paul Gentile’s March 22, 2006, editorial about the importance of being ready to provide the media with accurate information on credit unions. I, too, wrote a response to The Wall Street Journal regarding Bernard Wysocki’s March 7, article, “Bankers Struggle To Contain Growth Of Credit Unions.” I haven’t seen my letter published anywhere, though; and that’s not surprising, given that we credit unions generally have good news to tell. Here’s an excerpt of what I wrote to the Journal: “Harris Simmons said credit unions pay no taxes. Not true. While LA DOTD Federal Credit Union pays no income tax or sales tax, we do pay taxes. Last year, we paid $8,200 in property taxes, $11,708 in unemployment taxes and $109,365 in Social Security and Medicare taxes. We are far from the free ride that Mr. Wysocki is attempting to paint. “Unlike the over 2,000 Subchapter S banks that pay no income tax and pass the tax savings on to their owners, not-for-profit credit unions use the tax savings to benefit their members and communities. Last year, LA DOTD taught financial education to 1,450 elementary school children, and we presented over 100 financial seminars to schools, churches and nonprofit groups – at no cost to the groups or participants. We do this because it is our mission and the right thing to do, not to earn CRA credits, like the banks. Credit unions do not have to be forced to serve their communities! “After hurricanes Katrina and Rita, we paid all checks for members in the affected areas, regardless of their account balances for two weeks, and with no fees. We did this because we knew they had been forced out of their homes and jobs, and needed to have funds available. We extended affected members’ loan and credit card payments for 90 days (at no cost) and turned off late-loan fees. The dollar value on all of the above was over $100,000, but we did it because it is what a credit union is all about – serving its members. We also housed a credit union that had lost its building and provided the staff with equipment. A number of credit unions in our area did the same thing; some housed as many as two credit unions. I have not heard of any banks doing this. “Finally, Mr. Simmons complained that credit unions in Utah have 40% of the checking accounts in his state. As we all know, consumers vote with their wallets. Rather than blaming credit unions for being successful, I suggest he take a long, hard look at his own bank and work to be more competitive, rather than blame a group that is only 7% the size of all banks.” The Wall Street Journal unfortunately didn’t print my letter, and unfortunately its readers won’t hear stories like this, everyday stories of credit unions helping their members in ways many banks won’t. Cary J. Anderson President/CEO LA DOTD Federal Credit Union Baton Rouge, La.