Delaware is one of a handful of states with a modest budget surplus of $100 million this year. Our legislature is wrangling with the surplus and how to make the best use of it in an election year. Since Delaware does not have state-charter enabling legislation, our credit unions have not yet been directly affected by the taxation threats felt in many other states.
We do, however, have a concern that any success on taxation gained at the state level may eventually have an impact on how Congress views the federal credit union tax exemption. The recent events in Utah with the National Conference of State Legislatures (NCSL) are disconcerting to all credit unions. The NCSL Financial Services Standing Committee proffered a resolution last July to have the state legislatures lobby their federal counterparts to allow taxation of all credit unions under the guise of a "states rights" issue. Fortunately, the resolution was handily defeated 15-4 through the efforts of CUNA and several leagues. We will be watching this year's NCSL meeting very cautiously.
