Credit union advocacy, at its core, is about putting credit unions in a position to help their members succeed. That can mean defending credit unions’ current abilities—such as the credit union tax status—while also laying a foundation for the movement’s future needs.
Terms like “offense” and “defense” often fail to capture the nuance of credit unions’ advocacy efforts. America’s Credit Unions approaches advocacy priorities holistically, working together with leagues to look at the big picture of improving the operating environment for credit unions.
Our advocacy strategy to protect the credit union tax status began last summer, and brought the entire industry together with a unified voice to make sure Congress knows what is at stake if they add a new tax on credit unions—and ultimately 142 million Americans. As we maintain our focus to make sure the tax bill the president signs does not include anything to affect the credit union tax status, achieving that victory is just one part of our overall advocacy strategy.
Credit unions do amazing things to help people achieve their financial dreams, and preserving credit unions' tax status means we can keep those efforts constant. But there is so much more still to do. Our constant vigilance means not only do we stay focused on securing the credit union tax status as it makes its way through the legislative process, but we are fighting to protect interchange and the electronic payments system.
Sen. Roger Marshall has offered his Big Box Bailout bill—a measure credit unions oppose—as an amendment to the Senate stablecoin bill. We’re also pushing back on an amendment from Sen. Josh Hawley that would cap credit card interest rates at 10%. We’re working with senators to ensure these “poison pills” aren’t tacked onto the bill—as both would severely restrict access to credit, especially for the underserved.
To work toward new opportunities and keep evolving as an industry, credit union advocacy also includes proactive policies that will set a foundation for credit unions to modernize and do even more for their members and communities.
As we face economic uncertainty, being the financial partner credit union members need in tough times is vital. Updating arbitrary and often outdated requirements and thresholds—that stand as a barrier between credit unions and members in our modern marketplace—is part of our work as that needed partner. And several bills introduced this Congress would help do just that.
Legislation that would:
- Update federal credit union board meeting requirements, freeing up time and resources that can be better spent on member service. This bipartisan bill was introduced by Reps. Juan Vargas and Bill Huizenga in the House, and Sens. Bill Hagerty and Lisa Blunt Rochester in the Senate.
- Allow additional member business lending (MBL) flexibility by exempting loans to veteran-owned businesses from the cap and increasing the de minimis threshold under the MBL cap to $100,000 from its current level of $50,000. Sens. Mazie Hirono and Dan Sullivan introduced the Senate version, while Reps. Brian Fitzpatrick and Vicente Gonzalez introduced it in the House.
- Update the Currency Transaction Report threshold, which has been unchanged since 1972, to reflect inflation and economic changes more accurately. Rep. Barry Loudermilk introduced this bill.
Each one of these bills—if enacted—would allow credit unions to increase services to members and communities, including those that continue to be left behind by big banks.
We are also working to get bills introduced in the coming weeks that would:
- Increase investment authority for credit unions.
- Lift the federal credit union interest rate cap to an 18-percentage point spread above a benchmark rate to be determined by the NCUA board.
- Amend the Federal Home Loan Bank (FHLB) Act to give credit unions equal treatment in the “community financial institution” definition for FHLB membership.
- Increase the loan maturity limits to 20 years and give the NCUA Board the ability to further extend the maturity limit.
Additionally, we continue to fight for opportunities that allow all credit unions to add underserved communities to their fields of membership. All of these measures have something in common. They will give credit unions additional abilities to do what they do best: improve the lives of members and communities.
Successful advocacy is all about keeping our balance between both short-term and long-term priorities, making sure the important things stay at the forefront and don’t fall to the side.
Outside of the legislative process, this means relentlessly advocating in regulatory, judicial, compliance, and economic arenas to ensure credit unions can do what their members need, now and in the future.
