By Ray Birch
WASHINGTON— By a 77–20 vote, the Senate on Thursday approved the Fiscal Year 2026 National Defense Authorization Act (NDAA), which includes the NCUA Central Liquidity Facility Enhancements Act—a measure designed to permanently restore key CLF provisions that strengthen liquidity access for credit unions, especially smaller institutions, without costing taxpayers.
The legislation also includes an amendment to enhance support for the Community Development Financial Institutions (CDFI) Fund.
Senators Alex Padilla (D-CA) and Kevin Cramer (R-ND) introduced legislation, which makes permanent the temporary enhancements Congress made to NCUA’s Central Liquidity Facility during the COVID-19 crisis.
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The passage breaks a monthlong impasse on the annual defense policy bill.
Jason Stverak, Chief Advocacy Officer at the Defense Credit Union Council, reminded that DCUC has championed the CLF legislation from the start of this Congress.
Jason Stverak
“And we know firsthand how vital this emergency liquidity lifeline is for credit unions that often serve communities lacking alternative liquidity tools,” he said. “The Senate’s bipartisan vote to include the Padilla–Cramer CLF amendment in the NDAA is a testament to Senator Padilla and Senator Cramer’s leadership and what can be achieved when lawmakers put financial stability first. Now we urge House leaders to follow through in conference and keep this critical fix in the final bill. This is a must-pass fix—we’ve seen the CLF work exactly as intended during a crisis, and failing to make these provisions permanent would put small and defense credit unions—and the servicemembers and families who count on them—at unnecessary risk.”
Anthony Hernandez
“Making the NCUA Central Liquidity Facility enhancements permanent is a zero-cost, common-sense step that strengthens credit unions’ resilience, safeguards financial stability, and ensures military families and underserved communities have continued access to reliable financial support—especially in times of crisis,” said Anthony Hernandez, DCUC president and CEO. “We applaud Senator Alex Padilla and Senator Kevin Cramer for their bipartisan leadership in advancing this measure. This is a huge win for credit unions and the millions of members we serve across the country. By restoring this proven liquidity lifeline, Congress is bolstering the financial readiness of our servicemembers and their families and reinforcing that credit unions remain strong partners in supporting America’s defense community. We urge the House to preserve this critical provision during conference negotiations so it can swiftly be enacted into law.”
The trade group added that is also recognizes NCUA Chairman Kyle Hauptman for his leadership and consistent advocacy in support of the CLF.
“His thoughtful engagement and tireless efforts have helped educate lawmakers and industry leaders alike on the importance of maintaining a robust, accessible liquidity backstop,” Stverak said. “The NCUA’s leadership throughout this process has been instrumental in building the bipartisan support that made today’s success possible.”
CDFI Fund
DCUC also stated that it strongly supports bipartisan efforts to reinforce the CDFI Fund.“Credit unions are often the only financial lifeline in underserved communities, including military bases, rural towns, and inner-city neighborhoods," said Hernandez. "Strengthening the CDFI Fund ensures these institutions can continue to serve families, small businesses, and servicemembers who are too often overlooked by larger banks.” For over three decades, CDFIs—nearly 500 of them credit unions—have provided affordable loans, financial education, and economic development in low-income areas, many near military bases. In FY2024 alone, CDFI awardees financed over 109,000 small businesses and supported more than 45,000 affordable housing units, leveraging $8 in private capital for every $1 in federal funds, DCUC noted. “Credit unions deliver enormous value to their members and communities,” added Stverak. “Bipartisan support for the CDFI Fund proves just how vital they are to our nation’s financial health and security.”
ACU Responds
Jim Nussle
America’s Credit Unions stated that it "stayed focused" throughout the NDAA process to have Congress include measures that would help credit unions, while also protecting against amendments that would cause harm to credit unions and their members.
"Our advocacy efforts culminated with the Senate’s vote to advance the NDAA with two significant amendments that would help credit unions, by permanently extending emergency liquidity enhancements and also providing transparency to the U.S. Treasury’s CDFI Fund, while stopping another amendment that could have led to serious financial disruption," said ACU President/CEO Jim Nussle. "America’s Credit Unions is committed to ensuring the final NDAA bill brings significant, positive changes to empower credit unions and their members.”
Nussle thanked the champions of the pro-credit union amendments for their ongoing support.
“Credit unions are our nation’s financial first responders, taking quick action to help our communities through hard times by providing personally tailored low-rate services," he said. "But when credit unions need access to emergency resources in challenging financial times, current federal restrictions make it difficult for institutions to get the emergency assistance they need to keep the lights on and continue supporting their community. We thank Senators Padilla and Cramer for their support of our ‘people helping people’ mission and recognizing how vital it is for credit unions to be able to take quick action. If enacted, this amendment will allow credit unions easier access to critical emergency liquidity through the NCUA’s Central Liquidity Facility. We appreciate the Senate for working with America’s Credit Unions to ensure that credit unions will be able to get the help they need so they can help their members."
ACU emphasized that it led efforts to encourage senators to reject an amendment offered by Senator Rand Paul (R-KY) that would have prohibited the Federal Reserve from paying interest on deposits held at reserve banks by financial institutions. Nussle wrote to the Senate ahead of the vote, noting how the amendment would have a “devastating impact on community financial institutions like credit unions.” Over 1,200 credit unions benefit from these interest payments. The Senate rejected the Paul amendment by a vote of 14-83.
The Senate version of the NDAA also did not include any provisions relating to interchange.
The CDFI amendment is based on bipartisan legislation from Sens. Steve Daines (R-MT), Mark Warner (D-VA), Mike Crapo (R-ID) and Raphael Warnock (D-GA).
“Credit unions are often the financial backbone in vulnerable communities, providing services at lower rates and with affordable terms. While banks and other financial institutions regularly abandon these areas in search of higher profits, credit unions remain a key community partner and actively help their members reach their goals,” Nussle added. “The credit union movement thanks Senator Daines, along with cosponsoring Senators Warner, Rounds, Smith and Crapo, for their work to include the Community Development Financial Institutions package in the Senate NDAA. This amendment will help CDFIs better serve their communities and ensure Congress is performing their oversight responsibilities for the CDFI Fund.”
The House passed its version of the NDAA in September without any harmful amendments credit unions fought to exclude. The two chambers will meet in conference committee to agree on a version to send to the president.