Can Critic Of Tax Exemption Now Defend It? NAFCU's New Chief Lobbyist Was With America's Community Bankers

Register now

Can a banking lobbyist find true happiness in the credit union movement?

That's what many credit union observers are asking of the new hire to be NAFCU's chief lobbyist.

Or more to the point, can a lobbyist responsible for some of the bankers' more recent anti-credit union initiatives find acceptance in the credit union movement?

Dan Berger hopes so.

Berger, who spent the last few years bashing credit unions on Capitol Hill on behalf of America's Community Bankers, was hired last month as senior vice president of governmental affairs at NAFCU, the job held for many years by the well-known Bill Donovan. Donovan left NAFCU at the end of the year to work at the Washington law and lobbying firm of Venable LLP.

The hiring of the 39-year-old Berger raised some eyebrows among the credit union faithful, not just because he comes from the banking lobby-several leading credit union lobbyists have traveled the same career path-but because of the prominent role he played in several anti-credit union initiatives over the past year.

Among other things, in his role with the thrift trade association, Berger was credited with raising the issue of the credit union tax exemption with the tax-writing House Ways and Means Committee, which eventually held hearings questioning the continued validity of the precious tax break. He also lobbied lawmakers on the controversy surrounding credit unions' converting to mutual savings bank, helping draft legislation that would loosen NCUA's powers to regulate the charter shift for credit unions.

Mending Fences

To be accepted in the credit union movement, Berger is going to have to mend some fences, according to Chuck Zuver, former chief lobbyist for CUNA, who himself came to CUNA from the American Bankers Association in 1987. "But it was a different era back then," said Zuver. "You saw the other lobbyists all the time, on the Hill, at hearings, everybody was friends. Now the temperature has kind of gone up on things (on the credit union-banks battles)."

Berger is reluctant to acknowledge any role in the banks' anti-credit union initiatives but he recognizes the need for a few mea culpas. He wants his new constituents-those in the credit union community-to know that he will work tirelessly as their advocate. He also wants them to know he has been an active credit union member-Campus FCU in Gainesville, Fla., where his father is a professor at the University of Florida.

As an avid conservative, Berger emphasizes that he is anti-tax and will fight to preserve the credit union tax exemption. "They (credit union representatives) won't find a more energetic or aggressive advocate on their behalf," he said. "Look, I'm an anti-tax Republican."

His message to CU execs: "I support their tax exemption and will die to protect it."

A 'Tough Argument'

It won't be just credit union executives that Berger will have to convince. CUNA President Dan Mica, himself a former Congressman from Florida, said it will be an uphill struggle to explain his quick switch in sides to lawmakers. "He's got a tough argument to make," said Mica.

It was Berger's success with the bank/thrift lobby that attracted NAFCU, according to Fred Becker, who likened his hiring to taking one of the best players on the opposition team out of action. Berger's success in helping to move the banks' anti-credit union agenda on Capitol Hill, especially among Republicans, is proof of his abilities and influence in Congress and when transferred to the credit union side will be a big boost for NAFCU, which has long had a weakness when its comes to influence with Republican lawmakers, according to Becker. Becker emphasized he was solely responsible for hiring Berger and only told his board of directors after the hiring.

Mike Vadala, chairman of the NAFCU board and president of The Summit FCU, agreed with Becker. "I think he's going to bring us some perspective on what the other side (the banks) are thinking. He has great contacts on the Hill. He's been there awhile," said Vadala.

Vadala said he was not concerned with perceptions among members of Congress who might look askance on someone arguing on behalf of the credit union tax exemption who was arguing against it just two months ago. "I don't think it's all that uncommon in Washington," said Vadala. "The bottom line is you have to be loyal to your employer, frankly, and I'm sure he will be."

Berger has worked on political campaigns ever since high school, when he campaigned for both Republicans and Democrats in the Florida legislature. After receiving a degree in economics from Florida State University, he lobbied for several trade associations in the state Capital, where he became friends with Katherine Harris, who gained fame as Florida's Secretary of State and who worked to end the historic recount in the 2000 President election, when the Florida vote count threw the election to George W. Bush. Later, Berger spent a year at Harvard getting a degree in public administration. After Harvard, he helped start a venture capital firm that eventually failed during the bust.

In 2002 Berger returned to Tallahassee, where he ran Harris' campaign for Congress and when Harris won he came to Washington as her chief of staff. Two years ago, he went to work for the ACB, which has emerged as a major credit union antagonist on Capitol Hill.

Berger says he hopes to parlay his experience with the banking lobby into something of a negotiating position, perhaps bringing the two sides together on issues of mutual concern. Like the long-time fight for bankruptcy reform, there are many issues where credit unions can work together, he said. He suggested that the leadership at several of the banking groups would be amenable to cooperation with credit unions, something that has disappeared since the bankruptcy lobby. "I'm hoping the kind of relationships I have with those other trades will be a catalyst for those kinds of (cooperative efforts)," said Berger.

By No Means The First

The road from banking lobbyist to credit union advocate is a well-traveled one, noted Zuver. Among others who have traveled it are CUNA's Kathy Thompson and Mary Dunn, former CUNA lobbyists Jeanne Mary Murphy and Gary Kohn, and even Bill Donovan, as ardent a credit union advocate as you're likely to find, who started out his Washington career lobbying for the thrifts.

The bottom line, said Zuver, is Berger will be accepted if he is successful. "I'd advise him to get to know as many credit union people as possible," said Zuver. "He's got a tough argument to make. Be straightforward in your arguments. Members (of Congress) make switches all the time. They understand."

For reprint and licensing requests for this article, click here.