WASHINGTON–Two more pieces of pro-credit union legislation were announced by members of Congress during CUNA’s GAC here, bringing to four the CU-backed bills members of Congress announced plans to introduce while credit unions were in town.
The first was announced by Rep. Katie Porter (D-CA), who introduced the Board Governance Modernization Act, which would modify the Federal Credit Union Act requirement that credit union boards meet once a month to not more than six times per year. It is co-sponsored by Rep. Mark Amodei (R-NV).
“Credit unions play an essential role in our banking ecosystem,” said Porter. “We need to help credit unions continue to thrive and provide necessary services to our communities, which means that we need to tailor regulatory requirements to their unique size and needs. I’m proud to introduce legislation to do just that.”
CUNA said it and the California/Nevada Credit Union League have been working closely with Porter and Amodei on the bill. The trade group said modernizing the Federal Credit Union Act is a focal point of the CUNA/league 2020 advocacy agenda.
“CUNA and the leagues have prioritized these types of bills this year because Main Street communities stand to benefit greatly from important credit union governance modernization,” said CUNA President/CEO Jim Nussle. “We thank Reps. Porter and Amodei for working across the aisle on this important subject, and CUNA and the leagues will continue working directly with legislators to move this bill and others like it through the legislative process.”
Added Jeremy Empol, VP-federal government affairs with the California/Nevada CU Leagues, “Advancing modernizations to the Federal Credit Union act in all shapes and forms is vitally important to the movement. We greatly appreciate Representatives Porter and Amodei for their collaboration and effort to further advance our efforts.”
Senate Bill on Loan Maturities
The second bill announced during GAC on Wednesday would raise federal credit union loan maturity limits on non-mortgage loans from 15 to 20 years. It was introduced by Sens. Tim Scott (R-SC) and Catherine Cortez Masto (D-NV.).
Federally chartered credit unions are prohibited by statute from making loans with maturity limits in excess of 15 years except for mortgage lending. Oklahoma is the only state that has a similar restriction on state-chartered credit unions. No such constraint exists for banks.
CUNA noted it has been a longtime proponent of efforts to raise the current 15-year limit for non-mortgages, and has called on both NCUA and Congress to make such a change.
“We thank Sens. Scott and Cortez Masto for their bipartisan legislation that would open increased consumer access to safe and affordable credit union loan products,” said Nussle. “By reducing barriers to credit for those borrowers seeking longer term loans, this legislation will help credit unions provide new opportunities for those seeking to write their own financial futures."
NAFCU Response
“Extending loan maturity limits has been a top issue for NAFCU, and we successfully sought House introduction of this legislation last year. We have been engaged with Senators Tim Scott and Catherine Cortez Masto, and we will continue to work with them to finalize bill language to be introduced in the Senate to address this important issue. We thank them for their willingness to help credit unions improve flexibility in offering members credit,” said NAFCU Vice President of Legislative Affairs Brad Thaler.
League Support
In addition to CUNA, the legislation also had been pushed for by the Carolinas Credit Union League and the Nevada Credit Union League.
“Having served as a volunteer for Heritage Trust FCU, Sen. Scott understands how unnecessary barriers inhibit the ability of credit unions to serve their members," Carolinas League President and CEO Dan Schline said. "We appreciate his leadership in announcing this legislation that will provide credit unions greater flexibility by addressing the loan maturity limit in the Federal Credit Union Act. We thank Senator Scott and his team for their efforts, and we look forward to continuing to work with South Carolina credit unions and our partners at CUNA to advance the legislation.”
“This bill is another modernization that strengthens the dual charter system and brings more opportunities for credit unions to change their member's lives,” said Diana Dykstra, president/CEO of the California and Nevada Credit Union Leagues.
A similar, CUNA-supported bipartisan bill was introduced in the House last year by Reps. Lee Zeldin (R-NY) and Vicente Gonzalez (D-TX).
Other Bills Introduced
As CUToday.info reported, earlier this week, Sen. Thom Tillis (R-NC) and Richard Burr (R-NC) introduced the Credit Union Fairness Act (S.3326), which would remove outdated duties for credit union boards and remove the requirement for credit unions to provide NCUA with the names of its loan officers from the Federal Credit Union Act.
Separately Sens. Tina Smith (D-MN) and Ben Sasse (R-NE) introduced the Credit Union Governance Modernization Act (S. 3323), a bipartisan bill that would allow a credit union board to expel a member for just cause. In addition to CUNA, the Minnesota Credit Union Network and the Nebraska Credit Union League had also worked to secure its introduction.