Page 4 - index
P. 4


          Sen. Hatch Writes NCUA with                            Tax Foundation: ‘Worthwhile’

          ‘Concern’ about Credit Union                           for Congress to Revisit CU Tax
          Activities                                             Exemption

          Senate Finance Committee Chairman                      Reviewing the justification for
          Orrin Hatch (R-Utah), the top tax                      the credit union tax exemption
          policymaker in the Senate, has sent                    would    be    worthwhile,
          a letter to the National Credit Union                  according to an analyst at the
          Administration expressing concern                      nonpartisan  Tax  Foundation,
          about whether credit union activities –                a respected research group in
          and NCUA’s supervision – align with                    Washington, D.C. “Given the change in the financial sector
          the purposes of the tax exemption they                 over the last several decades, it would be useful for lawmakers
          enjoy. “I am concerned that the credit                 to reexamine the extent to which credit unions currently fulfill
          union industry is evolving in ways   Orrin Hatch       their original purpose,” Erica York wrote in an article on the Tax
          that take many credit unions further                   Foundation’s website. “If they have strayed from their intended
          from their original tax-exempt purpose,” he wrote to NCUA   function and now resemble other taxed financial institutions,
          Chairman Mark McWatters, noting in particular NCUA’s   their exemption would represent a disparity across similar
          actions to relax field-of-membership constraints, alternative   economic activities.”
          capital use and expanded business lending. “While these may   York noted that the credit union tax exemption is based on a
          be worthwhile pursuits, they should give us pause and cause   mission of helping “unbanked, lower-income people”; a restricted
          a reflection on the core mission of credit unions and their tax-  customer base united by meaningful customer common bonds;
          exempt purpose.”
                                                                 and  a business model that  avoids high-risk investments  and
          Hatch expressed particular concern about NCUA’s “common   provident financial products “such as small personal loans.”
          bond” requirements, which he said “seems to have been   Many credit unions, especially large, multi-billion-dollar CUs
          significantly watered down.” He also noted the common   that function like banks, have strayed from these limits.
          credit union tactic of allowing new members to join by paying
          a nominal fee to join a linked association that may even be   To read the article visit:
          “operated by the credit union itself,” as well as the overbroad   credit-union-tax-exemption/
          fields of membership that may make up entire states. “In other
          cases, credit unions have been established to serve the banking   North Dakota Bankers’ Op-Ed
          needs of otherwise highly paid individuals with easy access to   Praises Bipartisan Reg Reform
          banking services,” he wrote. “This is not the ‘well-understood
          sense of cohesion’ that [the 1998 credit union bill] envisaged   Effort
          credit union members sharing.”
                                                                 An op-ed by two North Dakota bankers
          Hatch also noted that many credit unions now offer insurance,   supported S. 2155, the bipartisan regulatory
          real estate brokerage and wealth management, “appear[ing]   reform bill in the Senate, and praised Sen.
          to operate in the same manner as taxable banks,” including   Heidi Heitkamp for her leadership role in
          acquiring for-profit banks and buying stadium naming rights.   moving it forward.
          Hatch asked NCUA to provide information to the committee   “Despite the political  noise  and partisan
          on how the agency oversees associations for purposes of CU   bickering from Washington, something
          membership, how NCUA enforces policies related to CUs   very unusual just happened in the U.S.   Christie Obenauer
          offering services outside of their tax-exempt purpose and how   Senate. North Dakotans should know
          it oversees executive compensation and corporate sponsorships.   about it,” wrote Christie Obenauer and
          McWatters’ response is due by April 6.
                                                                 Gary Petersen in the Fargo Forum.
          To view the Senator’s letter visit:  “Why should you care about this rare
          Advocacy/Grassroots/WINNDocs/Letter-Orrin-Hatch-to-    moment of bipartisan unity? Because the
          Mark-McWatters-credit-union-oversight.pdf              commonsense, targeted changes included
                                                                 in the bill will allow North Dakota    Gary Petersen
                                                                 banks to better serve our customers and

   1   2   3   4   5   6   7   8   9