NAFCU writes House appropriators on credit union concerns over Community Development funding, CFPB, NCUA
WASHINGTON, DC (July 13, 2017) — National Association of Federally-Insured Credit Unions (NAFCU) Vice President of Legislative Affairs Brad Thaler, in a letter today, urged the House Appropriations Committee to approve $250 million in funding for the Community Development Financial Institutions Fund, restore funding for the National Credit Union Administration (NCUA) Community Development Loan Fund, provide for a five-member Consumer Financial Protection Bureau commission and keep the NCUA out of appropriations when it marks up a spending bill Thursday.
Thaler, NAFCU’s vice president of legislative affairs, conveyed thanks for the work lawmakers have done on the fiscal 2018 spending package on financial services and general government, but he noted the above issues as being of key concern to credit unions and offered recommendations.
CDFI Fund: Thaler urged the panel to approve $250 million in fiscal 2018 funding for the CDFI Fund. The 287 CDFI-certified credit union (as of Jan. 31) represent 27 percent of total institutions certified and hold more than 50 percent of total CDFI assets. “Clearly, CDFI credit unions are critical partners in the CDFI Fund’s mission,” Thaler wrote.
“The CDFI Fund grant program helps credit unions serve communities and consumers that large banks do not focus on,” Thaler urged. He also sought restoration of CDRLF funding.
CFPB structure: “Given the broad authority and awesome responsibility vested in the CFPB, a five-person commission has distinct consumer benefits over a single director,” Thaler wrote. He said a commission would allow several perspectives and robust discussion of consumer protection issues. He urged support for an amendment expected from Rep. Mark Amodei, R-Nev., to create a bipartisan commission.
NCUA funding: Thaler stated NAFCU’s support for several provisions in Title IX of the measure that would benefit credit unions, but he reiterated NAFCU’s opposition to placing the NCUA under the congressional appropriations process. “The current structure of the NCUA, including a three-person board, has a track record of success, and we would urge the committee to strike this section from the bill,” Thaler urged.
In further comments on Title IX, Thaler urged the panel to ensure unregulated entities, such as payday lenders, “do not escape oversight.”
Below please find the full-text of the letter:
July 12, 2017
The Honorable Rodney Frelinghuysen The Honorable Nita Lowey
Chairman Ranking Member
Committee on Appropriations Committee on Appropriations
United States House of Representatives United States House of Representatives
Washington, DC 20515 Washington, DC 20515
RE: Tomorrow’s mark-up of the FY2018 Financial Services and General Government Appropriations bill
Dear Chairman Frelinghuysen and Ranking Member Lowey:
On behalf of the National Association of Federally-Insured Credit Unions (NAFCU), the only trade association exclusively representing the federal interests of our nation’s federally-insured credit unions, I write ahead of tomorrow’s mark-up of the fiscal year 2018 Financial Services and General Government Appropriations bill to thank the Committee for their work moving this bill forward, but also to outline areas of importance and concern for credit unions.
NAFCU strongly urges you to support $250 million in FY 2018 funding for the Community Development Financial Institutions (CDFI) Fund. As of January 31, 2017, there were 287 credit unions certified as CDFIs. Representing 27 percent of the total number of certified institutions, CDFI certified credit unions hold more than 50 percent of total CDFI assets. Clearly, CDFI credit unions are critical partners in the CDFI Fund’s mission. In recognition of this importance, and in exploring ways to enable even more credit unions to be recognized as CDFIs, the National Credit Union Administration (NCUA), the CDFI Fund and Treasury entered into a trilateral Memorandum of Understanding (MOU) in January 2016. A significant component of the MOU included the introduction of a streamlined CDFI application for credit unions, paving the path for more credit unions to seek the designation.
CDFI credit unions predominantly serve low-income areas and other target markets and often are the only financial services options for consumers that live paycheck to paycheck. The CDFI Fund grant program helps credit unions serve communities and consumers that large banks do not focus on. Over the past two years, CDFI credit unions received roughly $70 million in grant funding to aid in their efforts to offer financial services to their low- and moderate-income members. Without the CDFI grant program, many credit unions would not have been able to offer these products and loans that provide financial stability for members and their families. It is with this in mind that we urge your support in amending the bill to include full CDFI funding. NAFCU would also urge the Committee to restore the funding for the NCUA’s Community Development Revolving Loan Fund (CDRLF).
NAFCU supports the Consumer Financial Protection Bureau (CFPB) governance structure moving from a single director to a bipartisan commission. Given the broad authority and awesome responsibility vested in the CFPB, a five-person commission has distinct consumer benefits over a single director. Regardless of how qualified one person may be, a commission would allow multiple perspectives and robust discussion of consumer protection issues throughout the decision making process. A bipartisan board structure at the CFPB would also help to provide community financial institutions more regulatory certainty by lowering the possibility that the Bureau could become subject to drastic political swings from a single director that could change with each administration. We urge you to support the amendment to be offered by Representative Amodei to create a bipartisan commission to govern the CFPB.
NAFCU supports efforts to provide credit unions regulatory relief, such as those found in Title IX of the bill. There are several provisions in Title IX that would be beneficial to credit unions, however we maintain concerns about Section 906, which would subject NCUA to the congressional appropriations process. The current structure of NCUA, including a 3-person board, has a track record of success and we would urge the Committee to strike this section from the bill.
Finally, we want to be sure unregulated entities, such as payday lenders, do not escape oversight. We would urge the Committee to ensure the provisions of Title IX do not allow this to happen.
Thank you for the opportunity to share our thoughts ahead of the mark-up. We appreciate FSCC Subcommittee Chairman Graves’ effort to provide regulatory relief and urge the full Committee to consider our proposals. Should you have any questions or require any additional information please contact me or Allyson Browning, NAFCU’s Associate Director of Legislative Affairs, at 703-842-2836 or email@example.com.
Vice President of Legislative Affairs
cc: Members of the House Appropriations Committee
The National Association of Federally-Insured Credit Unions is the only national trade association focusing exclusively on federal issues affecting the nation’s federally-insured credit unions. NAFCU membership is direct and provides credit unions with the best in federal advocacy, education and compliance assistance. For more information on NAFCU, go to www.nafcu.org or @NAFCU on Twitter.