WASHINGTON – The credit union lobby and its top congressional allies are attempting to revive the regulatory relief bill for credit unions and get it primed for a vote.
But pressing negotiations on a mortgage rescue bill are almost certain to push off any vote on the CU Regulatory Relief Act, or CURRA, until after Congress’ week-long Memorial Day vacation, if not longer.
House Financial Services Chairman Barney Frank told credit union executives during CUNA’s CEO Roundtable last week he hopes to put both the credit union bill and a regulatory relief bill for banks to a vote at the same time, to reduce any impulse by the banks to get the credit union bill defeated.
But Frank, who spoke to the executives by teleconference, will be the focus of House-Senate negotiations on a mortgage rescue package that passed the House last week, and the Senate the week before, limiting his availability until a final deal is struck.
The mortgage bill would help bail out lenders and troubled homeowners by providing federal guarantees to restructure $300 billion in troubled home loans and provide money so states can buy foreclosed properties for resale, but it has little of interest for credit unions.
What it also does not have is a provision that would have allowed bankruptcy judges to restructure mortgages under Chapter 11 proceedings, which was strongly opposed by credit unions.
“Right now, there’s been a lot of focus on the housing bill. Next, they’re going to be busy on the budget, and then the war amendment, so there won’t be a lot of time for discussion of the credit union bill,” said Brad Thaler, senior lobbyists for NAFCU.
CURRA is similar to the CU Regulatory Improvements Act, without two major CURIA provisions opposed by the banks: enactment of a risk-based capital system for credit unions and a lifting of the cap on member business loans.
As in CURIA, CURRA would: allow credit unions to retain their select groups after converting to community charters; allow all credit unions to branch into underserved areas; and, exempt religious-based loans from the business loan cap.
Because they thought it was more amenable to the banks, congressional leaders had scheduled CURRA for a vote last month on the so-called suspension calendar, reserved for non-controversial bills, but a flurry of lobbying by the banks forced them to withhold the bill from a vote.
Since then, congressional aides have been working with credit union and banking lobbyists to come up with acceptable language. “They’re doing some tweaking at the edges to make sure it’s the best bill it can be,” John Magill, chief lobbyist for CUNA, told The Credit Union Journal Friday.
But credit union lobbyists warned that they are against major changes. “CURRA, in essence, has already been a compromise, sort of tweaked from CURIA,” said NAFCU’s Thaler. “There’s just so much you can tweak before you tweak it away.”
