WASHINGTON—Both credit union trade groups are praising the Environmental Protection Agency (EPA) following the release of its plan to distribute $27 billion as part of the Greenhouse Gas Reduction Fund (GHGR), a plan adopted under the Inflation Reduction Act.
Both CUNA and NAFCU said the funding presents loan opportunities for credit unions.
NAFCU noted EPA confirmed that it would not create a single green bank to divvy the funds, a move the trade group has opposed. Instead, the agency plans on creating two federal assistance listings: $7 billion for zero emissions program for state, local and native governments, and $20 billion for accelerator program for eligible non-profits.
For several months, NAFCU noted it has engaged the EPA to secure credit unions' ability to receive GHGR Funds.
"NAFCU is pleased that the Environmental Protection Agency rejected the idea of a single, national green bank in favor of a multi-recipient model to ensure credit unions and community development financial institutions (CDFIs) are able to assist in fulfilling the core objectives of the Greenhouse Gas Reduction (GHGR) Fund,” said NAFCU Vice President of Regulatory Affairs Ann Petros. “NAFCU has been a leading advocate for a commonsense interpretation of the text of the Inflation Reduction Act to establish an efficient and effective framework that will leverage the strengths of experienced community-based lenders, especially those in low-income and disadvantaged communities, and swiftly and more pragmatically deploy monies from the Fund to reduce greenhouse gas emissions and other air pollutants.”
CUNA: CUs are 'Best Positioned
Separately, CUNA President and CEO Jim Nussle said, “CUNA applauds the Environmental Protection Agency’s recent announcement that it will allow eligible nonprofit entities that collaborate with community financing institutions like community development financial institutions (CDFIs) and credit unions to obtain competitive grants under the EPA’s Greenhouse Gas Reduction Fund.
“As recognized by the EPA in the announcement, credit unions and CDFIs are best positioned to deliver funding to the low-income and disadvantaged communities which Congress intended to benefit with the creation of the Greenhouse Gas Reduction Fund," Nussle continued. "Credit unions and CDFIs have a long, demonstrated history of working creatively to develop the products and services that low-income and other disadvantaged communities need. Credit unions and CDFIs are the perfect partner to leverage funds and disburse competitive grants to these communities efficiently and effectively.
“CUNA looks forward to working with the EPA on the ongoing implementation of the Fund and its competitive grant programs to ensure that these programs achieve their intended goals.”
Framework Needed for Crypto Regs
Separately, with a hearing on the issue taking place this week, the Senate Banking Committee is being pressed by NAFCU to establish a clear regulatory framework for cryptocurrency and other financial technologies.
In a letter to the committee ahead of its hearing on financial safeguards for digital assets, NAFCU Vice President of Legislative Affairs Brad Thaler acknowledged the potential of digital assets, with proper design and oversight, to:
- Create efficiencies and reduce credit unions’ operational costs
- Facilitate payment transactions
- Enhance regulatory compliance
- Reduce instances of human error, fraud, and other misconduct
“However, the absence of a clear regulatory environment and appropriate supervisory framework poses risks to the adoption of these otherwise promising technologies,” Thaler wrote. “NAFCU supports innovation with these technologies, but the absence of a clear regulatory framework that supports safety and soundness, transparency, and appropriate disclosure of risk to investors and consumers brings with it inherent risks.”
While there has been bipartisan support for new oversight of cryptocurrency, that is where much of the agreement ends, with Republicans and Democrats taking different positions on what that oversight should look like.
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