Lessons Learned, Trivia Gained, Futures Lost & A Surprise
Someday, some smart person will coin a phrase that goes something like “what goes around comes around” or “those who don’t learn from history are doomed to repeat it,” or sayings to that effect. And someday those two scenarios will intersect.
Welcome to Someday.
Next week, in our March 3 issue, Credit Union Journal will publish a comprehensive, fascinating and intriguing look back at the passage of the Credit Union Membership Access Act, often better known, as if the Senate were not involved at all, as HR 1151.
The point of this special issue of the Journal is to commemorate the 10th anniversary of the passage of that legislation in conjunction with CUNA’s GAC, which has expanded into Washington’s Convention Center after a long run at the Washington Hilton Hotel.
For those who think those extraordinary events and effort leading to HR 1151 are oh-so-10-years-ago, you are mistaken. Last week the two major credit union trade groups exhibited a bit of we-have-learned-our-lesson behavior when they dropped their support for a regulatory relief bill that didn’t really offer much in the way of regulatory relief–at least not for credit unions.
It sometimes seems the credit union community has been pining for the Credit Union Regulatory Relief Act (CURIA) since the moment President Clinton put the pen down from signing HR 1151 into law. As former CUNA Chairman Nancy Pierce observed shortly after the Oval Office ceremony, “When things settle down, people will discover that this legislation (HR 1151) is not ideal.” Chiefly lacking in the Ideal Department was the 12.25% cap on Member Business Loans for federal charters, a deal credit unions had to cut to get the bill out of committee (you can read more about that next week, too).
CURIA has been moving about as fast as Korea. Credit unions have gotten some traction on CURIA in the previous and current Congress, with some 143 co-sponsors on the bill at press time, but not enough to get it unstuck. A lot of lobbying time has been spent and PAC dollars invested in getting the legislation advanced, and when that happens it becomes tempting to cut a deal, take the best you can get and call it a victory–especially when many credit unions are struggling along with their members in the current economy.
Credit unions had a chance to do just that last week, but opted against raising their fingers in a “V”. As the Journal’s Ed Roberts reported, “Both CUNA and NAFCU turned down an offer to attach the Reg Relief provisions to the so-called Wal-Mart Bank bill because the provisions were so heavily laden with bank measures but had only minor inducements for credit unions.”
The congressional plan contained no capital reform, lifting of MBL limits or allowance for community chartered CUs to expand into underserved areas. As such, it wasn’t all that much of a plan for credit unions, who then made it their plan to walk away from it like a congressman from a tough question.
Still, credit unions made nice with the Senate Banking Committee as they know they’ll all have to work together again sometime. What’s interesting is to ponder how credit unions might have handled all of this just over 10 years ago.
* The New York Post gets credit for uncovering an interesting piece of credit union trivia. In a profile of Actors FCU in New York, The Post noted how the CU has come to build its niche serving all those who call themselves actors but who pay the bills as bellhops and waitresses and taxi drivers. As part of that story, it noted the first-ever mortgage made by Actors FCU was made to Jerry Orbach, a long-time Broadway actor who was better known as “Det. Lennie Briscoe” on TV’s Law & Order. The loan was made in 1967 for a West Side brownstone. Orbach died in 2004.
* There has been much talk about loan terms going longer as folks seek affordable payments, such as 84-month auto loans that have the potential to outlive the car. So how about a 32-year repayment schedule? In case you missed it, a member of Valley Central FCU in Goshen, N.Y., who stole $196,000 by depositing bad checks, has been ordered to repay the amount in $500-a-month payments. Not that Corilynn Mullen will be pulling down a big paycheck; she is headed to prison for 12 years.
* In 62 days the Journal will kick off a conference aimed at helping you do one thing, grow your credit union. We have an outstanding line-up of speakers from inside and outside CUs to discuss every aspect of growth. We’re also getting ready to unveil a surprise, bonus session for attendees at the April 27-29 show in Orlando. Make sure you’re there and growing!
Frank J. Diekmann is Publisher of The Credit Union Journal.