DENVER— Colorado’s swipe-fee fight intensified Wednesday after SB26-134 cleared the state Senate on a narrow margin, prompting the Defense Credit Union Council to move quickly with letters to key state officials as industry sources indicated a motion to reconsider could come as soon as Thursday.
DCUC said it sent letters Wednesday to Sens. Julie Gonzales, Robert Rodriguez, Marc Snyder and Tom Sullivan, as well as to Gov. Jared Polis’ office, warning the bill—while framed as a limited change to how interchange is applied to sales tax—would in practice impose a network-level mandate that could disrupt the payments system and hit military serving credit unions well beyond Colorado.
In its letters, DCUC argued that even with carveouts and asset thresholds, the bill would still force payment-network reprogramming, create operational complexity, and expose institutions to litigation risk, while offering little evidence consumers would actually see savings at the register. The group also pointed to Illinois’ Interchange Fee Prohibition Act as the clearest warning sign, noting the law there has already triggered major litigation and a federal preemption move by the OCC ahead of its July 1 effective date.
“While SB26-134 may be framed as a targeted policy change, the reality is far different, this is a network-level mandate that will ripple across the entire payments system and directly impact the credit unions serving our nation’s military community,” DCUC Chief Advocacy Officer Jason Stverak said. “As currently drafted, this legislation places a direct burden on Navy Federal Credit Union, but the implications stretch far beyond a single institution. Navy Federal is not just another financial institution; it is a lifeline woven into the daily lives of servicemembers and their families. When you pull on that thread, you begin to unravel a broader fabric of support that credit unions provide to those who serve. DCUC will not stand by while one institution is singled out and we stand shoulder to shoulder with them and every credit union committed to serving our nation’s defenders.”
Stverak said defense credit unions rely on interchange income to support fraud prevention, secure transaction processing, financial counseling and emergency assistance, and warned that the bill’s exemptions “simply do not work in practice” because payments systems are interconnected and smaller institutions historically have still absorbed downstream costs under similar interchange frameworks.
“At the same time, there is no guarantee that any theoretical savings will ever reach consumers,” he said. “What is far more certain is the loss of services, reduced card benefits, and increased costs for the very communities credit unions are chartered to serve. We urge lawmakers to reject SB26-134 and instead pursue solutions that support small businesses without undermining financial access, security, and readiness for those who serve our country.”
In its letter, DCUC went further, tying the issue directly to military readiness by citing Defense Department and GAO data showing many active-duty households already face financial strain, food insecurity and PCS-related financial disruptions. The group argued that any reduction in the resources available to military-focused credit unions could worsen hardship for servicemembers and their families, while also raising retention concerns.