Illinois credit unions are about to receive a $6.2 million windfall following resolution of a protracted lawsuit by the Illinois Credit Union League against the administration of former governor Rod Blagojevich.
The $6.2 million payment from the state follows passage of enabling legislation signed Monday by Gov. Patrick Quinn, which clears final roadblocks on the so-called "fee raid" or sweeps on CU and bank examiner fees seized by the Blagojevich administration in 2004 and challenged by financial trade groups in lawsuits.
Under terms of the agreement in the new legislation, CUs will also receive a reduction in their regulatory fee paid to the state going forward, in the aggregate amount of approximately $650,000 per year, said a statement from the Illinois League.
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"This has been a long journey, but in the end we are very pleased to have settled this issue for the benefit of our member credit unions," said Dan Plauda, ICUL president/chief executive officer. "The credits paid to credit unions couldn't come at a better time in light of current economic conditions and the reduced regulatory fee to be paid in 2009 and ensuing years will generate significant savings for credit unions."
The "fee raid" lawsuit filed by the Illinois League and joined by the Illinois League of Financial Institutions, and the Community Bankers Association of Illinois in 2004 stemmed from Blagojevich moves to siphon off regulatory income to cushion a state budget crisis, subsequently challenged in a Springfield court as a "breach"
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