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After the Berlin Wall came down, Congress decided to cash in the peace dividend and began closing military bases. One of the bases that closed was our primary sponsor, McClellan Air Force Base. We decided to convert to a community field of membership. Unfortunately, our federal charter limited the field of membership to such an extent that we had to switch to a state charter to serve the multicounty Sacramento region. Charter choice is important for many reasons. The NCUA Board recently approved a new rule which permits the NCUA to designate a state-chartered credit union as “in troubled condition.” The rule allows NCUA to override state regulator determined CAMEL codes. This is one more step by the NCUA to threaten the dual chartering system. I am concerned that credit unions that choose a state charter are finding themselves under de facto federal regulation. That erodes the dual chartering system.

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