WASHINGTON–The Senate has passed a huge $750-billion defense bill that includes language opposed by credit unions that would extend to banks certain waivers for rent and other facilities costs for financial institutions on military installations currently granted to credit unions.
As CUToday.info reported earlier, the House version of the National Defense Authorization Act does not include the language. Section 2821 of the Senate bill would require the Department of Defense (DoD) to treat all banks the same as credit unions.
In response, CUNA said it will continue to work with Congress as the bill moves forward and differences in the two pieces of legislation are hashed out in conference committee. CUNA noted the “Senate NDAA language is not as severe as the language in last year’s House NDAA, which CUNA, leagues and the Defense Credit Union Council successfully fought to exclude.”
The language in the current Senate-passed NDAA would broaden the exemption for banks, but only if they meet the same standards as credit unions eligible for the exemption, most notably that 95% of the membership of the institution is active duty or retired servicemembers and their families, according to CUNA.
DCUC Responds
The Defense Credit Union Council, which includes 181 member credit unions, said it is “concerned” with the Senate bill.
DCUC President Tony Hernandez said the traditional arguments against the provision–bankers can already negotiate for free rent via 10 USC 2667, bankers are making record profits, and it creates a “slippery slope” for other “for profit” entities such a defense contractors, etc.–apparently didn’t sway the Senate.
Hernandez described the Senate bill clause as a threat to “all the hard work credit unions do to earn their no-cost land leases, and to pass on savings directly to the troops.” He called it a situation where, if bankers don’t get their way, then credit unions must also lose to make things “equal.”
“Although DCUC is disappointed that the Senate chose to keep the banker provision in their bill, we are redoubling our efforts in the House,” said Hernandez. “That chamber’s version currently does not contain any bank lease language, and if credit unions continue to educate members of Congress about the unfair and deceptive banker campaign on this issue, I am optimistic we will prevail in the Conference Committee. This is a much longer fight ahead.”
NAFCU Response
Similarly, NAFCU said it will continue to fight the provision.
"NAFCU is disappointed that changes to nominal lease provisions remain a possibility in the 2020 NDAA," said NAFCU Vice President of Legislative Affairs Brad Thaler. "The Department of Defense should not be required to provide 'free rent' for big banks like Wells Fargo just because it offers that to not-for-profit credit unions. We fought to have this provision removed in last year's final bill, and we will again work closely with House and Senate conferees to exclude it this year."
NAFCU said Thaler also sent an email to the association's defense credit union members.
"NAFCU remains staunchly opposed to the Senate language," Thaler said.
NAFCU is urging credit unions to be prepared to advocate against its inclusion once the House and Senate come together to reconcile differences in their bills.
The House begins is floor debate on its version on July 8.