Persistence appears to have paid off for Continental Savings, which has been lobbying for a break on its share of a thrift industry tax for more than a year.
As part of a sweeping tax package passed June 27, the Senate agreed to give the Seattle thrift an extra 15 years to pay the roughly $3.7 million it owes on $11.2 million in bad-debt reserves.
Continental's tax liability was created last year when Congress passed legislation forcing thrifts to pay taxes on bad-debt reserves taken after 1988.
Most of the industry benefited from the law because it also exempted pre-1988 reserves from $3 billion in taxes. Continental, however, was founded in 1988 and has few reserves that are exempt from the tax.
At the urging of Sen. Slade Gorton, R-Wash., the Senate approved a narrowly written amendment that would let Continental stretch its tax payments over 21 years, rather than the six years thrifts were given in last year's law.
Credit union groups recently showed their appreciation to Rep. Steve LaTourette -to the tune of $10,000. Four trade groups hosted a June 26 fund-raising dinner at the Capitol Hill Hyatt Regency for the Ohio Republican, who is sponsoring pro-credit union legislation. Thirty-five credit union executives and trade group officials ponied up $100 apiece for the fish and vegetables meal. Political action committees of the Credit Union National Association, the National Association of Federal Credit Unions, and the Virginia and Maryland credit union leagues also donated $6,500.
Rep. LaTourette's bill, which has attracted 81 co-sponsors, would allow credit unions to serve more than one membership group. His proposal was a response to a federal court decision last July that limited a credit union's customer base to its founding membership group.
In a June 26 letter, Rep. LaTourette urged more lawmakers to sign on and "make many of your constituents happy."
Chase Manhattan Corp., Citicorp, and Bankers Trust New York Corp., have joined with several securities firms to lobby for changes in the Commodities Exchange Act.
The banks, along with Salomon Inc., CS First Boston Inc., Merrill Lynch & Co., Goldman Sachs & Co., and Morgan Stanley, Dean Witter, Discover & Co. have formed the Ad Hoc CEA Coalition to push for a number of changes in the law. The banks are primarily pushing Congress to write into law regulatory decisions allowing them to sell derivatives to retail customers.
"We are seeking legal certainty for our over-the-counter derivatives business," Citicorp spokesman Jack Morris said.
J.P. Morgan & Co. has hired attorney Robert E. Glennon of the Williams & Jensen law firm to lobby on tax legislation now before Congress.
"Robert Glennon is the best tax lobbyist I've ever met," said Cory Strupp, the bank's in-house lobbyist.
Morgan executives are unhappy that proposals passed by the House and Senate two weeks ago contain provisions that will increase taxes on the bank's securities operations.
Among the provisions Morgan wants changed is a measure that would reduce tax deductions for dividends on securities held for hedging purposes.
Even though the House and Senate have already passed several provisions aimed at reducing securities tax shelters, Mr. Strupp said there's still time for the lobbying effort to pay off as lawmakers try to work out differences in their two tax bills.
