WASHINGTON After California’s Gary Miller was targeted for defeat by credit unions’ first Super PAC last year it was hard to imagine that Miller, who won an eighth congressional term anyway in the state’s new 31st House district, would be positioned to be the next credit union champion in Congress as he was last week.
Miller, who ripped the credit union lobby soon after last year’s primary for backing his opponent, announced during last week’s House hearing on regulatory relief for credit unions that he will be the first to introduce a bill that would put in place many changes that have been sought by credit unions.
“While I fully support effective federal regulation in the financial services sector, it is clear that credit unions did not contribute to the financial crisis,” said Miller during last week’s hearing before the House Financial Services Committee. “That’s why I am drafting legislation that will help ease the regulatory burden on credit unions while ensuring that the consumer protection-driven intent behind the regulations is maintained.”
Credit unions could not have picked a less likely champion.
Miller let his anger show during NAFCU’s Congressional Caucus last September, after the California CU League poured $250,000 into the primary. The money came via a new Super PAC called Restoring Our Democracy, which tried to help elect former Arrowhead CU executive Pete Aguilar to the redrawn 31st House district. “If someone did that to you, would you support them?” Miller said during the NAFCU conference, in an unusually frank retort.
The credit union lobby has spent the time since then making amends to Miller, who is vice chairman of the powerful financial services panel that has jurisdiction over credit union issues. After the ill-fated primary, credit union lobby groups made several PAC contributions to Miller and tried to convince him the League’s financial support for Aguilar was necessary because of Aguilar’s credit union background, and not an effort aimed at his own defeat. The national groups also explained to Miller that the Super PAC was a California League initiative and not operated by the national groups.
There have been several signs of forgiveness by the powerful House member since then.
“Congressman Miller has always been a very strong supporter of all community-based financial institutions, especially credit unions,” said Dan Berger, chief lobbyist for NAFCU, which was blindsided by Miller’s remarks at last year’s conference. “It appears to me, if it is good public policy for his constituents in his district, he has a reputation for pursuing it. As a businessman, he understands the positive economic impact that credit unions provide for his constituents.”
“Congressman Miller has a track record as an advocate for the free market generally, and for lessening regulatory burdens, so this kind of legislation is completely in character for him,” said John McKechnie, a congressional lobbyist who represents several state credit union leagues.
Among other provisions, Miller’s regulatory relief legislation will:
Enable NCUA to step in where appropriate and modify a Consumer Financial Protection Bureau rule as long as the modified rule still meets the objective of the CFPB;
Authorize a risk-based capital system for credit unions;
Require that the CFPB and NCUA conduct a cost-benefit analysis after three years of a new regulation;
Modernize the Central Liquidity Facility;
Provide flexibility for NCUA to grant a federal credit union parity in connection with broader state rules;
Update investment options for credit unions so they can better manage their portfolios and risk; and,
Establish a risk-based capital system for credit unions;
It is not clear if the bill will include the long-sought effort to raise the cap on member business lending, still the top credit union legislative priority.
