WASHINGTON, DC

HELPING THE ECONOMY NOW

H.R. 1537, the Credit Union Regulatory Improvements Act (CURIA), was introduced on March 15, 2007 by Representatives Paul Kanjorski (D-PA) and Ed Royce (R-CA). In May of 2008, Sen. Joe Lieberman (I-CT) has introduced the Senate companion to CURIA, S. 2957. The bill is nearly identical to that pending in the House. This is the first time stand-alone credit union legislation has been introduced in the Senate.

If passed, this bipartisan legislation would create the opportunity for credit unions to infuse an estimated $14.1 billion from California and $576 million from Nevada into the American economy without costing the tax payers one dime.

In 1998, Congress passed legislation which mandated an arbitrary and inflexible reserving system for credit unions, forcing them to maintain an excessive level of reserves regardless of the nature of their lending portfolios. H.R. 1537 would return credit unions to a risk-based system similar to the one employed by banking entities around the world, thereby permitting credit unions to make responsible loans while at the same time maintaining reserve capital actually needed for safety and soundness. The additional capital would then be loaned into their local communities to spur growth. In addition, H.R. 1537 would allow credit unions a modest increase in small business lending. Many credit union members who wish to launch a small business have been rejected by banks due to the modest size of their request, or a lack of business history at the bank. H.R. 1537 would allow credit unions to continue to underwrite these crucial small business start-ups up to 20 percent of a credit union’s financial portfolio. A limit of 12.25 percent was implemented in 1998 and is enforced today. Prior to 1998, there was no cap on business lending by credit unions. A decade of experience with this arbitrary provision has hampered local small business development.

At this time of great economic uncertainty, Congress cannot afford to impede credit unions from making reasonable home and small business loans. Throughout the current crisis, credit unions’ focus on their members’ long-term financial health has proven them to be the most trustworthy part of the nation’s financial sector. 90 million Americans who belong to credit unions are looking to Congress to remove the arbitrary limits that impede credit unions from doing more to assist the economy.

We must, however, continue to focus on getting as many CURIA co-sponsors to show support for credit union modernization. It is crucial that we continue to educate and inform legislators about the need to raise the cap on member business lending and for capital reform.

REGULATORY RELIEF
CURRA H.R. 5519/ CUBTRRA H.R. 6312

The Credit Union Regulatory Relief Act (CURRA), H.R. 5519, a smaller package of “non-controversial” CURIA provisions morphed into a larger credit union and bank package entitled, the Credit Union, Bank and Thrift Regulatory Relief Act, H.R. 6312. The House of Representatives passed the bill on June 24, 2008, under Suspension of the Rules. We are hopeful that the Senate considers this bill prior to adjournment.

While this bill would not increase the member business lending cap, it does exempt member business loans in underserved areas from the cap. There is also a new provision that would grandfather existing underserved areas as approved by NCUA. This is an important protection for credit unions against future banker litigation.

Other provisions that benefit credit unions include language that amends the Gramm-Leach-Bliley privacy notification requirements. Under this provision, a credit union would not be required to send annual privacy notifications under certain circumstances if it has not changed its policies and practices with respect to disclosing nonpublic personal information since its last disclosure. Title IV also includes a requirement that the Federal Reserve conduct a study that compares fees on products offered by banks and credit unions. This study is sure to show the pricing advantage enjoyed by credit union members in most cases.

As we have noted in the past, the California and Nevada Credit Union Leagues will continue to focus on garnering additional co-sponsors and support for CURIA. Chairman Barney Frank (D-MA) has assured us that this new legislation is the first step in a series of measures to achieve meaningful regulatory relief for credit unions.

The California and Nevada Credit Unions Leagues are the only state credit union trade associations with a full-time Washington office. For more information regarding credit union issues at the federal level, please contact Director of Federal Government Affairs Debbie Kwon-Moore at debbiek@ccul.org.

Below you will find information on legislation and a link that will connect you with our nation's leaders. Contact them to let them know that you support credit unions.

The White House
U.S. Department of the Treasury
U.S. House of Representatives
U.S. Senate

SACRAMENTO

This year will be busy for credit union advocates with continuing work on data breach reform. In addition, dozens of bills have been introduced seeking to modify lending and foreclosure processes in reaction to the mortgage crisis. Our priority is to ensure that credit unions can continue to meet their members’ needs, while still contributing to a fair and free marketplace.

Credit Unions Work to Meet Your Needs

The California State Legislature is composed of the State Senate and State Assembly, and the current session runs from December 4, 2006 until August 31, 2008, creating a two-year legislative cycle.

This legislative year, credit unions are advocating an ambitious agenda to better serve our members.

The 2007-2008 legislative session brings new opportunity for credit unions as our advocacy team works to protect our credit unions.

These are links to elected officials at the state capitol. Write or call them to share your support of credit unions.

Governor's Office
State Senate
State Assembly
Secretary of State
State Treasurer
Attorney General

Credit Unions Work to Keep You Safe  - Data Breach / Data Security
Every day, your confidential information is at risk and that is why credit unions are working to keep your information safe.

For example, major retailers such as T.J. Maxx , Marshall’s and Montgomery Wards have recently had data breaches in which customer data has been misplaced or stolen.

To fix this problem, the credit union movement has turned to the state legislature. Assembly Bill 1656 will help protect the financial data of California consumers and enhance California’s existing data breach notification law to give Californians more information about where and when their data was breached.

Credit Unions Work to Promote Financial Literacy
It is clear that the mortgage crisis and credit crunch have exacerbated the need for Californians to have more access to financial literacy. Elected officials and respected leaders in the financial services community have all called for more financial literacy during this time of economic uncertainty. The California and Nevada Credit Union Leagues are supporting a duo of financial literacy bills during this legislative session.

Assembly Bill 1502, introduced by Assemblyman Ted Lieu would ensure that information about financial literacy is included in California curriculum frameworks for grades 1 to 12. The bill would encourage economics instruction to include subjects related to the understanding of personal finance, budgeting, savings, credit, and identity theft.

The second financial literacy bill, also authored by Assemblyman Ted Lieu, seeks to establish the California Financial Literacy Initiative for the purpose of providing resources and instruction to Californians. Assembly Bill 2123 encourages public/private partnerships in the name of financial literacy and authorizes the State Controller to act as a clearinghouse for the collection of financial literacy materials and programs to be used by interested parties.

The credit union community understands the importance of financial literacy as a foundation for a strong economy and as a means of empowerment for individuals. As such, the California and Nevada Credit Union Leagues will continue to be a vocal supporter of financial literacy legislation.

Credit Unions Work for Those Seeking to Realize the Dream of Home Ownership
While representing a small piece of California’s mortgage puzzle, credit unions play an important role in making home loans available to families and individuals. Credit unions are very prudent and responsible lenders, underwriting loans at fully indexed rates and considering each loan part of a lifetime relationship with the member.

Senate Bill 1137 (Perata) will enact several changes to the foreclosure process, giving those facing foreclosure opportunity to understand the process better through a number additional notices and conversations with their lender. Much of this legislation highlights procedures that are already commonplace at credit unions in California.

This bill was signed by Governor Schwarzenegger and took effect on July 8, 2008.

Credit Unions Work for All Homeowners
Despite the small role played by credit unions, the current crisis in the overall mortgage market is extremely serious and deserves attention. Therefore, the California and Nevada Credit Union Leagues are supporting AB 1918 (Neillo) that would, for specified loans beginning with the 2007 tax year, exclude from taxable income any amount of a mortgage loan forgiven by a taxpayer’s lender.

AB 1918 would provide much needed assistance to homeowners facing the worst – loss of their home. The current requirement that any loan forgiveness amount be added to taxable income can substantially increase a borrower’s tax liability for that year, making a very difficult financial situation impossible to recover from.

As the legislative session in Sacramento continues, please check back regularly for updates on these critical issues.

If you want to tell your representative how you feel about credit unions or any of the legislation on this page, then CONNECT FOR THE CAUSE!

 

CARSON CITY

To Contact Nevada officials to share your support of credit unions, visit the links listed below.

Governor's Office
State Senate
State Assembly
Secretary of State
State Treasurer
Attorney General

The Nevada State Legislature is comprised of the State Senate and State Assembly. The legislature meets every other year for only 120 days.

Towing and Lien Liability
One of the many services that credit unions provide is in the form of vehicle loans. In Nevada a recurring problem is growing worse: cars are towed to facilities, for things like illegal parking, and owners are not notified in a timely manner as currently required by Nevada law. The result is that fees are incurred at such a high rate many vehicle owners are forfeiting their automobile to their financial institutions.

To combat this problem, Nevada credit unions worked on legislation with Assemblyman Joe Hardy to limit tow and storage companies fees that can apply if notification of the owner is not made according to the timetable in Nevada law.

The Nevada credit unions were pleased to see AB 311 clear the State Assembly, 42-0 in April. On May 22, the Senate approved the bill, 21-0, sending the bill to Governor Gibbons where he signed the bill into law, effective January 1, 2008.

Want to tell your representative how you feel about credit unions or any of the legislation on this page then CONNECT FOR THE CAUSE!