SAN FRANCISCO — The California and Nevada Credit Union Leagues may have shocked members when it announced an enormous reduction in the group's advocacy campaign budget for 2009, from $6 million to $1 million. However, members overwhelming supported the move, with unanimous votes of approval from Nevada delegates and 99% approval on the California side.
The budget slash follows a letter the league sent to members in early October, announcing plans to reduce the program by $2 million, resulting in a $4 million budget. However, after seeing third-quarter financials and receiving feedback from members, the league decided to make further cuts, said spokesman Henry Kertman.
The change means a reduction of more than 80% in the advocacy program assessment fee league members have been paying in addition to membership dues since 2005. Credit unions with fewer than $38 million assets will pay a flat fee ranging from $0 to $50. Larger credit unions will pay 0.00000492 of assets plus roughly a nickel per member.
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Program cuts will come in advertising campaigns to the public, eliminating them almost entirely, Kertman said. Instead, the league will try to build off the success it has had with less expensive, grassroots campaigns, he said.
Mica Shares CUNA's Position on
Treasury and Congressional Relief
SAN FRANCISCO — CUNA President/CEO Dan Mica said he thinks credit unions should be united in their resolve to ensure credit unions aren't left out of government programs to aid struggling financial institutions. Mica echoed many in the industry when he said credit unions don't have to participate in relief programs, but they should have the option.
Mica told a story of when he was a congressman in Florida and had a constituent who was the CEO of a savings and loan and a big supporter of deregulation. The man would grab Mica by the lapel and say he didn't want any help; he only wanted government to leave him alone.
"Fast forward a couple of years, during the S&L crisis, when he flew to Washington, grabbed me by both lapels and begged for help," Mica said. "I asked him, 'weren't you the one who kept saying no?' He replied, 'that's easy to say when you're not about to die and I'm about to die.'"
Mica continued, "It's easy to say, if you're in a pocket of the country that isn't experiencing these terrible losses, to let those who are solve their own problems. But think about if the situation reached you? How would you want to be treated?"
The CUNA leader also said new NCUA Chairman Michael Fryzel is limiting relief options available to credit unions. Mica said Fryzel and the NCUA told CUNA they want to take the lead in recommending credit union recovery programs to the Treasury and suggested the nation's credit unions choose between either risk-based capital or secondary capital and let the NCUA handle the rest.
"I don't think it's appropriate for our regulator to narrow our choices before going to Congress," he said, adding that in his opinion, the most practical course of action would be to follow whichever option seems to have the most political traction before eliminating any.
As for a lame duck congressional session, Mica said his shop is preparing for that possibility, but the additional session isn't a sure thing yet. Congress will test the waters with President Bush to see if he is likely to sign whatever bills they're considering. If Bush seems unlikely to cooperate, the session will not happen, Mica said.
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