Community Banker Alert

The credit union industry is at it again. They have reintroduced legislation, H.R. 2317, the “Credit Union Regulatory Improvements Act of 2005 (CURIA), that would substantially expand credit union powers by expanding their commercial lending authority and lower minimum capital requirements. Last session, this legislation was H.R. 3579 and many PACB members responded to our call to action by contacting their Congressional representatives in opposition. Because of your efforts, only two Pennsylvania Congressmen cosponsored the credit union’s bill.

We urgently need you to make contact again. In conjunction with the CUSTF of PA, we have made opposition to this regulatory expansion for credit unions a top priority. We believe stopping this legislation is crucial so that the provisions of H.R. 2317 do not further exacerbate the unfair advantage credit unions enjoy.

The message we would suggest you communicate to your Congressional representatives is:

• Please do not cosponsor or support H.R. 2317, the “Credit Union Regulatory Improvements Act of 2005”;
• Oppose any further expansions of credit union authority and powers;
• Remind your member that credit unions have an enormous unfair advantage through the tax subsidy they enjoy, costing the U.S. taxpayer $1.4 billion a year. This subsidy, coupled with the creation of the community charter, has resulted in an enormous expansion of the credit union industry hurting community banks and our customers.

While asking them not to cosponsor the CURIA, you might also take the time to ask them to do something positive.

• Ask your member to help level the playing field by cosponsoring H.R. 2061, the “Communities First Act of 2005” (see PACB Alert of May 18, 2005). This legislation would help restore fairness by giving qualified community banks (under $5 billion in assets) tax credits and deep regulatory relief. Unlike the credit unions’ legislation, which is regulatory expansion, H.R. 2061 is regulatory relief and tax reform.

This is the time for members to get involved if you haven’t done so already. Please make contact with your Congressional representatives and provide PACB with a copy of your communications. Please do not hesitate to contact our Government Affairs Consultant, Dave Transue, if you need further information or have any questions. Thanks so much.