WASHINGTON (11/13/15)--CUNA outlined exactly how two provisions in the DRIVE Act (H.R. 22) will remove barriers keeping credit unions from more fully serving members in a letter to Congress sent this week.
H.R. 22 passed the Senate and the House in slightly different forms, so a conference committee is currently working out the differences.
“Credit union employees and volunteers work every day to deliver service excellence to their members, but there are several statutory and regulatory barriers that keep credit unions from more fully serving the savings and credit needs of their members,” CUNA President/CEO Jim Nussle wrote, adding that Section 75001 and Section 82001 would remove some of those barriers.
Section 75001 is based on H.R. 601, which has passed the House on numerous occasions and would modernize privacy notification requirements. Since 2001, credit unions have sent more than 1 billion privacy notices to their members, averaging more than 87 million notices per year.
“A voter survey conducted in 2013 showed that fewer than one-quarter of consumers read the privacy notifications they receive, and over three-quarters of consumers would be more likely to read them if they were only sent when the financial institution changed its policy.” Nussle wrote. “This suggests that the public policy goal of privacy notifications would be better achieved if the notices had more meaning to consumers. We believe that this legislation achieves this goal.”
Section 82001 is based on H.R. 299, which would correct a drafting oversight in the Federal Home Loan Bank (FHLBank) Act that has resulted in a small number of privately insured credit unions being ineligible to join an FHLBank.
The House has passed corrective legislation in 2004, 2006, 2014 and, most recently, in April of this year.
CUNA’s letter was addressed to Senate Committee on Environment and Public Works Chair Sen. James Inhofe (R-Okla.) and ranking member Sen. Barbara Boxer (D-Calif.), as well as House Committee on Transportation and Infrastructure Chair Rep. Bill Shuster (R-Pa.) and ranking member Pete DeFazio (D-Ore.).
CUNA also signed a joint letter to committee members advocating a House-passed amendment from Reps. Randy Neugebauer (R-Texas) and Bill Huizenga (R-Mich.) that would remove from H.R. 22 an extension of higher Fannie Mae and Freddie Mac guarantee fees (g-fees). G-fees protect taxpayers from mortgage losses but are not designed to fund unrelated spending.
“Each time g-fees are extended, increased and diverted for unrelated spending, homeowners are charged more for their mortgages and taxpayers are exposed to additional risk for the long-term,” the letter reads.
CUNA successfully kept the g-fees extension out of the Senate highway bill. To make up the funding difference, the Neugebauer-Huizenga amendment would use the Federal Reserve’s surplus account of accumulated retained earnings after paying operating expenses and dividends.