The Credit Union Membership Access Act (HR 1151) is marking its fifth anniversary since President Clinton signed it into law. Below is part two in a Credit Union Journal series with members of the executive committee of the Campaign for Consumer Choice, which oversaw the efforts to get the legislation passed. In this installment, two past chairmen of NAFCU, Jim Guretzky, CEO of SAC FCU in Omaha, Neb., and Dave Miller, president of Kalamazoo District Bell FCU in Michigan, share their thoughts.
What strikes you most as you look at where credit unions are now versus five years ago, just prior to the passage of the bill?
Guretzky: Before, we were a reactive type of movement, and now we're much more proactive. We're not as na We are more astute about what happens during the legislative and legal process. Before, we believed we would win out simply because we were the good guys, and we wouldn't have to do anything to prove that. We did win in the end, but not by waiting for someone else to fight the battle for us.
Miller: We've seen a lot of mergers and community charter conversions, and we're serving more members now than we did five years ago.
Is there one moment you recall more than any other in the two year fight leading up to the passage of the bill, and why do you recall it?
Guretzky: I served as treasurer and then chair of the NAFCU board during that time period. The NAFCU board had a meeting, right around the time of the hearings on HR 1151 in the House, and we set aside our whole agenda and spent the whole day and a half strategizing on this. It was a grueling session, and we had strong opinions. We had to give directions to our lobbyists about what we would be willing to give up.
I remember we were at a reception for U.S. Rep. Ackerman, and it was when the House was deciding whether it was going to split our bill off from the banking bill, and we initially thought we had lost that battle and we were feeling pretty down. But there was (NAFCU lobbyist) Bill Donovan talking to another lobbyist on the cell phone, and we found out that Rules Committee had decided to recommit to the bill and separated HR 1151 from the bank bill. That was big. There were a couple of times in the House hearings when I thought we'd lost, but we saw it through.
Miller: It looked like we had the best relationship with CUNA, better than we had shared in the past. We had a pretty good working relationship with CUNA, and we had to try to work this together. It was a good bill, and I had all the confidence in the world that it would pass.
While much of the Campaign was intensely public, is there anything that you can share now that happened "behind the scenes" amongst the steering committee that isn't well known?
Guretzky: Let's just put it this way, there had to be a lot of give and take. Sometimes I felt like NAFCU gave more, and I'm sure CUNA felt there were times that CUNA gave more. And there were some contentious issues as you would expect anytime you try to put two cultures together, but everyone had to give a little for the movement to win.
Out of all that came out of the Campaign, is there a particular piece of marketing or advertising, or a message that you thought was really creative and powerful?
Guretzky: The consumer choice slogan was very powerful, and that really sent the message. But it was really who delivered it that made it so powerful. It wasn't CUNA, and it wasn't NAFCU, it was credit union people. And frankly, it was really the leagues that got them out there.
Tell us about the very early days of the Campaign for Consumer Choice, your becoming involved, and what the Executive Committee was discussing?
Guretzky: We already had the coordinating legislative meetings about every three months or so to discuss regulatory and legislative issues, and that's where we started to talk about this. NAFCU already had a plan all laid out, and we gave it to CUNA to look at, and a day or so later CUNA issued its plan, and it was strikingly similar to ours.
It looked like there would be two campaigns. There was a lot of back-and- forth for months. But it was at a meeting in Chicago when credit unions said they wanted a united campaign, and the two groups had to listen. One of the most important people behind getting the two trades together was (CUNA Mutual CEO) Mike Kitchen. Obviously CUNA Mutual had a vested interest in ensuring the movement wasn't fractured, but I don't think Mike Kitchen has ever been given enough credit for bringing us together.
Miller: As a board, NAFCU came to the conclusion that we couldn't go it alone. We needed the help of the other trades, and that's why we teamed up with CUNA.
What was your experience in lobbying elected officials prior to the Campaign, and did it change or evolve once you were more involved?
Guretzky: I did the usual, attending governmental affairs conferences and doing the obligatory visits, but nothing that really cemented that relationship. It was more perfunctory and a matter of course. (HR 1151) was a life-and-death issue, and obviously we were very fervent about this, so I became a much more impassioned lobbyist, as it were. I was more passionate about issues and about lobbying. They kind of speak a different language, and I learned the language. I was very fortunate to meet some great people- (Rep. Paul) Kanjorski, (Rep. Steve) LaTourette, (Rep. Jim) Leach. It was a pleasure to meet these people.
Miller: It definitely evolved. We got one powerful message and that continued to carry through, so it was much easier to talk with Congress when we had one united message.
What do you recall of your interaction with members of Congress?
Guretzky: At times, it was frustrating, particularly dealing with my own senator (Chuck Hagel) because he voted against the bill. I've talked with him since then, because there's always another vote, and you never know when someone might be on your side. I talked with him after the Senate vote on his amendment but before the final vote. He felt very strongly about member business lending. I said to him, "You've lost this vote, but we really would like to have you on the final vote tomorrow." And he said, "You don't need my vote." "I know," I said, "but we'd still like to have it." Of course, he voted against us. But you never write anybody off.
Miller: They were all willing to listen. It was a good bill, so we didn't have a lot of people who disagreed with it, but we had some who, for political reasons, could not sponsor it.
How much of your time was consumed by being a member of the Campaign, and how did you work that out with your credit union?
Guretzky: Being chairman of NAFCU and being on the campaign was pretty much a full-time job, but regardless of the campaign, any time you run for an office like that, you've got to discuss it with your board. The credit union pays your salary, and you have to have their support.
When I was NAFCU chair, our credit union was in great shape, and we had very capable people here. So you delegate more, you work weekends, but some things just don't get done. The day-to-day stuff got done and we continued to grow, but we lost some strategic direction at the credit union. There was no way I could effectively convey or implement a strategic plan at that time, but there would have been nothing to plan for if we didn't get that bill through. I look back now and say, "how did I do that?" But I had a great time, and I enjoyed doing it.
Miller: Back during that period of time when I was chairman of NAFCU, I spent most of my time in Washington working for NAFCU. But the board was understanding, and I had a good staff. It was a case of it needed to be done, so they never questioned my work with NAFCU. And when I wasn't in Washington, I was always on the phone. My phone bills dropped by $600 to $800 a month when the campaign was over.
At the time the bill was signed by the president, did you have any inkling of the growth in field of membership and overlaps that credit unions would see?
Guretzky: I had some idea, but definitely not to the extent that it has. So much has changed since, then. It wasn't just the bill. The regulator today is not the same as the regulator then. Our regulator today is encouraging growth in credit unions. The regulator then had a different view of what a successful credit union movement should be. So, at the time, I didn't envision TIPs, for example. I didn't envision all these conversions community charter.
In retrospect, did credit unions compromise too much in accepting some of the limitations included in HR 1151, such as the cap on member business loans?
Guretzky: I don't think so. You either had a bill or you didn't have a bill. It was as simple as that. You can scream and holler and say "I won't accept that," but the response to that is, "then you won't have a bill." And we had to have a bill.
Miller: At this point, you could probably say yes, but at that time, it was just too important to get the bill passed. Once you win with such a big margin, as we did, you start wondering, "should we have asked for more?" It's kind of like selling a car, if someone accepts your first offer, you wonder if you didn't ask for enough.
How did the experience change you?
Guretzky: I have a greater appreciation of what our lobbyists go through, a greater appreciation of the legislative process. We all know the saying about legislation and making sausage-it's not pretty, but I'm proud to have been involved in it. I certainly found that our congressmen and senators are people just like you and I, and they are trying to do the right thing. I have a great deal of appreciation of what can be done when you have a common sense of purpose. Great things can be done.
Miller: It reinforced my belief that if you have teamwork, you can accomplish anything you set out to accomplish. Our members were very supportive, and I really feel it was teamwork that passed the bill.
Not many people realize that CUNA Mutual Group put up a lot of money to get this campaign started. A lot of credit unions put money up, but it was Mike Kitchen and CUNA Mutual Group that put $1 million to get this started. He had a lot of foresight, and he never got enough credit for it.
Do you feel there is danger in that credit unions have become so focused on Washington that they are under-represented in state capitals?
Guretzky: No, I don't think there's any danger of that. NAFCU was born because CUNA provided no legislative or regulatory representation in D.C.
Even today, when you look at the composition of CUNA, you can see that credit unions are well represented at the state level. With the strong state leagues, credit unions will always be well represented.
Miller: Maybe from a state-charter perspective, but we're a federal charter, so I don't know. We are best served by being in Washington, and before the campaign, we lacked a really strong lobby in Washington.
What do you believe the next five to 10 years hold for credit unions, and what about the status of the tax exemption?
Guretzky: I see continued growth and prosperity for the nation's credit unions. As far as taxation goes, we are not-for-profit financial cooperatives, and we are not taxed because of our structure, not who we serve or what products we offer. As long as we maintain that structure, taxation shouldn't even be discussed. I look forward to a great future for credit unions.
Miller: Personally, I am very concerned about the direction credit unions are going. They have forgotten the philosophy of the credit union movement.
I'm not a big believer that bigger is better. But that's just my own belief.