Size Has Nothing To Do With Tax Status, Credit Union Tells Public Broadcasting Debate

“Size has nothing to do with [credit unions’] tax exemption; it’s all about structure,”  said Scott Burgess, CEO of Beaverton, Ore.-based Rivermark CU, in a debate aired on Oregon Public Broadcasting’s “Think Out Loud.”

The show featured Burgess and Lewis & Clark Bank Co-President/CEO Trey Maust discussing three bills in the Oregon legislature that would impose an excise tax on large credit unions as well as require Community Reinvestment Act-type disclosures from credit unions about their service to low-income residents.

“As credit unions, we’re not-for-profit and member-owned financial cooperatives,” Burgess said. “We’re owned  and governed by members and don’t have stockholders. We return our earnings to members through lower rates for loans, higher rates for deposits and no or lower fees.”

The tax exemption has nothing to do with the type of products and services offered or the size of the credit union, “but everything to do with the not-for-profit, financial cooperative structure– and we earn that every day.”

Taxation “would be devastating to Oregon credit unions and ultimately to credit unions in the rest of the U.S.,” Burgess said, adding credit unions “have done a wonderful job” of showing value in the services provided members.  “[Oregon] credit unions put $120 million back in the wallets of our 1.4 million members,” he said. Credit unions  offer a choice and competition. “Just being out there and competing with banks has put money in the consumers’ wallets.”

Protecting and defending credit unions’ tax exempt status is the No. 1 legislative priority for the Credit Union National Association for 2013.

The debate also centered on the CRA-type of requirements in two of the bills that would require disclosures. “Giving back to our communities and serving low- to moderate-income members is in our DNA,” Burgess said.

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