Michigan Governor Signs Credit Union Act Update into Law
Michigan Gov. Rick Snyder (R) signed the Michigan Credit Union Act update on June 9 — the first comprehensive update to CU laws in 13 years, according to the Michigan CU League.
The Republican governor signed the package of six bills on stage at the state league's Annual Convention & Exposition, marking his third visit to the convention. He was joined by MCUL members at the event that drew a crowd of nearly 1,000 people.
"Michigan credit unions should be applauded for their vigorous, grassroots advocacy which resulted in real results for the industry," MCUL EVP Ken Ross said.
One of the significant parts of the legislation is the creation of the Credit Union Regulatory Fund within the Michigan Department of Treasury. The fund will protect regulatory fees that have been paid into the Department of Insurance and Financial Services.
"As an industry, credit unions pay over $7 million into [the] DIFS annual budget, second only to insurance," Ross said while testifying in front of the House Financial Services Committee last year. "Protecting these fees is critical so that during future state budget crunches, credit union fees aren't targeted to shore up budget shortfalls."
The package consists of many measures amending the state charter:
- Permits pre-payment penalties in the commercial sector
- Relaxes co-signer/borrower and guarantor regulations
- Reduces board meeting requirement to six times a year
- Eliminates fixed assets cap for well-capitalized CUs
- Allows refinancing incentives and loan promotions
The suite of bills unanimously passed out of the Michigan Senate and House earlier this session and will take effect 90-days after signing.