Credit Unions Told To Wait Til Next Year For Legislation
The cry was "wait till next year" for credit union legislation during NAFCU's annual Congressional Caucus last week.
With a little more than two weeks left in the 108th Congress, lawmakers were loath to project any confidence that credit union-backed bills on bankruptcy reform, regulatory relief, non-member services, or member business loans would get considered this year, saying instead the next Congress would provide greater opportunities.
Credit union champion Paul Kanjorski said he was pleased with the support gathering for the CU Regulatory Improvement Act he co-sponsored but the regulatory relief package known as CURIA will have to wait until the next Congress for serious consideration. "It won't pass the 108th Congress, but what we'll have to do is reintroduce it in the 109th Congress and I do think it will pass next year when the silly season (election campaigning) is over," said the chief sponsor of HR 1151, the landmark CU Membership Access Act of 1998.
Likewise, also waiting are a the regulatory relief bill for credit unions and s&ls; a bill to allow credit unions to offer check cashing and wire transfers to non-members within their fields of membership; and a measure to exempt church-based loans from the onerous limits on member business loans; a bill to increase the coverage on federal deposit insurance to $130,000 per account; as well as the bankruptcy reform bill. All have been relegated to the dustbin for the year and will have to be started up all over again when the new Congress begins next year, congressional leaders told the 400 attendees to the annual NAFCU conference.
And, even though a "lame duck" session of Congress is likely to be held after next month's election, there is little chance any of these bills will be enacted, the speakers agreed.
But the progress made on some of these bills will provide critical momentum for next year. "So we have a marker for next year," said Sen. Michael Crapo (R-ID), who is drafting the Senate's own version of the regulatory relief bill that passed the House earlier this year.
The main topic of discussion last week was the widening scandal over accounting practices at Fannie Mae. Daniel Mudd, the company's chief operating officer, spoke to the conference and said the company is satisfied with a supervisory agreement it signed with its regulator, the Office of Federal Housing Enterprise Oversight, the day before the conference. Under that agreement, Fannie agreed to boost its capital by 30% and initiate reforms with respect to its internal controls, organization and staffing governance and accounting. "The company and the board will work closely to implement all of those provisions," said Mudd.
But several lawmakers suggested the scandal, in which Fannie was found to have manipulated its finances in order to meet expectations from Wall Street-similar to what was found last year to have occurred at Freddie Mac-will spur efforts to reform oversight of the two secondary mortgage market giants. Kanjorski even suggested the separate scandals will fuel efforts to fully privatize the two government sponsored enterprises, a notion that had growing support among some in Washington.