WASHINGTON, D.C (July 30, 2025) |
The Defense Credit Union Council (DCUC) expressed its strong support for the NCUA Central Liquidity Facility (CLF) Enhancements Act, a bipartisan bill introduced by Senators Alex Padilla (D-CA) and Kevin Cramer (R-ND).
The legislation would permanently restore key provisions that expand credit union access to the National Credit Union Administration’s (NCUA) Central Liquidity Facility, a vital emergency liquidity backstop.
As the leading trade association representing credit unions serving the military and defense community, DCUC shared how this bill is one of its top legislative priorities — with direct implications for the financial stability of credit unions and the economic readiness of military families.
“Making the NCUA central liquidity facility enhancements permanent as a zero-cost, common sense step that strengthens credit unions' resilience, safeguards financial stability, and ensures military families and underserved communities have continued access to reliable financial support--especially in times of crisis," said Anthony Hernandez, DCUC President & CEO. "We appreciate both Senator Cramer and Senator Padilla for their bipartisan leadership on this critical issue and look forward to working together to enact the CLF Enhancement Act into law.”
“DCUC has championed this legislation since the early days of the pandemic,” adds Jason Stverak, DCUC Chief Advocacy Officer. “And defense credit unions often serve communities that lack access to other liquidity tools, so this is a large part in why DCUC has stressed that losing this lifeline weakens credit unions’ ability to respond to crises and best serve the communities that rely on them for their financial needs.”
A Proven Liquidity Lifeline – Especially for Military Communities
The CLF, administered by the NCUA, provides emergency lending to credit unions facing unexpected liquidity needs. During the COVID-19 crisis, temporary enhancements passed through the CARES Act enabled corporate credit unions to serve as "agent members" and purchase CLF capital stock on behalf of smaller institutions. This move increased CLF participation from just 283 credit unions to over 4,100 — including many serving on-base and military-connected populations.
Those provisions expired at the end of 2022. As a result, over 3,300 small credit unions — many under $250 million in assets — lost CLF access, and the facility’s total available liquidity shrank by nearly $10 billion.
Key Benefits of the NCUA CLF Enhancements Act
The bill offers a no-cost, proactive solution to reinforce the credit union system before the next crisis strikes. DCUC highlighted several key benefits of the legislation:
- Improved Emergency Liquidity Access – The bill ensures credit unions of all sizes can access critical funds in times of stress, allowing continued support for members without disruption.
- Enhanced Financial System Stability – Broader CLF participation reduces systemic risk and protects the National Credit Union Share Insurance Fund (NCUSIF).
- Support for Small, Community, and Defense Credit Unions – The bill’s provisions restore an important safety net for credit unions on military bases and in underserved communities, where alternative liquidity sources are limited.
- Preparedness Without Cost to Taxpayers – The Congressional Budget Office has confirmed the bill carries no scoreable cost. It strengthens financial defenses with zero taxpayer burden.
A Longstanding Advocacy Priority
DCUC has long urged Congress to make these enhancements permanent. In 2024 and early 2025, DCUC sent letters and testimony to House and Senate committees underscoring how permanent CLF reform would improve readiness, protect small credit unions, and preserve lending in local and military communities. Despite broad bipartisan support and the House’s prior passage of similar measures, permanent reform has not yet been finalized.
“This is a must-pass fix,” Stverak adds. “We’ve seen the CLF work exactly as intended during a crisis. Failing to restore and extend these provisions puts small and defense credit unions — and the members who count on them — at unnecessary risk.”
Stay up to speed with DCUC’s advocacy and representation at dcuc.org/news.