Protecting Tax Exemption Is No. 1 Priority
ARLINGTON, Va. — With all eyes on the massive federal deficit and Congress' struggle to put a real dent in it, NAFCU has made protecting the CU tax exemption its top priority for 2011.
"The report from the Presidential Commission is an indirect attack," NAFCU CEO Fred Becker told Credit Union Journal, referring to the report to the president in which recommendations are made for reducing the deficit. While the credit union tax exemption was not specifically named in the report, the fact that it suggested that "everything" needs to be put on the table is an indication that all such exemptions are going to be scrutinized.
Adding to the urgency, Becker said, is the fact that 2011 is not an election year, which means lawmakers may be more willing to make difficult, unpopular decisions because they are banking on the voting public having two years in which to "forget" how their elected officials voted.
Among the trade group's other big priorities for the year:
• Enhance the value of the federal charter, spearheading measures such as increased member business lending authority and modernized capital standards that preserve mutuality. Becker anticipates that NCUA Chairman Debbie Matz will be sending letters to the new House and Senate Banking Committee Chairs in support of risk-based capital and supplemental capital for CUs.
• Ensure, through strong advocacy, that legislative and regulatory efforts, including at the new Consumer Financial Protection Bureau, do not result in the imposition of additional regulatory burdens on the credit union industry.
• Advance the value of credit union membership by educating Congress and the public about credit unions' service to communities, their work to thwart predatory lending, focus on members' data security and contributions to financial literacy.
• Continue to advocate for lessening the impact and cost of assessments for corporate stabilization and federal share insurance.
• Continue to advance credit union interests regarding the reasonableness of interchange fees, including preservation of the statutory exemption for institutions with $10 billion in assets or less.
• Monitor implementation of new rules and changes to the corporate credit union system, especially as NCUA may wish to extend some to natural person credit unions.
• Advocate for changes to assist credit unions in operational issues (for example, reinstitute full RegFlex authority, keep a strong federal preemption).
• Continue to press for credit-union-friendly changes to Regulation Z and monitor any further changes to credit card rules.
• Continue to advocate for examination consistency; and for exam appropriateness with regard to concentration risk.
• Continue to lend strong political support to national candidates that understand and appreciate the interests of the credit union industry. Becker noted that out of the 129 candidates that NAFCU supported during the 2010 election, 109 won.
• Continue to provide credit unions opportunities to boost growth and productivity, educate staff and build best practices through programs of NAFCU and its subsidiary, NAFCU Services Corporation.