The ranking member of the Senate Banking Committee, in concert with another member of that key panel, pledged support of the credit union tax status on the CUNA Governmental Affairs Conference stage Tuesday.
Sens. Sherrod Brown (D-Ohio) and Jeff Merkley (D-Ore.) said any proposal that would alter credit unions’ tax status would not have their backing.
Brown underscored that he was far from being alone in Congress in his support of credit unions. “I want to be clear that any proposals to change the tax status will not win the support of me, and whole a lot of others.”
Brown pledged to work on a bipartisan basis to make sure credit unions and other community financial institutions aren’t encumbered by regulations that are not aimed at them.
“I want to continue to work across the aisle to make sure the rules put in place to reign in the largest financial institutions are not having a chilling effect on our smaller institutions,” he said.
A number of credit union-friendly bills have been introduced by Brown in recent years, including the Privacy Notice Modernization Act and a bill that would allow privately insured credit unions to be part of the Federal Home Loan Bank program.
“I hope and expect that these pieces of legislation--while they’re not big in the whole scope of things, they are pretty important for a large number of people--can get through,” Brown said.
Politico’s “Morning Money” highlighted both Brown’s speech and CUNA’s GAC Tuesday, citing Brown’s willingness to work with Republicans on legislation that would alter the way regulators oversee certain financial institutions.
Merkley’s GAC comments mirrored those of Brown, including his support for maintaining credit unions’ tax status.
“Let’s make sure that whatever conversation there is about tax reform, and believe you me there’s a lot that needs reforming about our tax system, let’s make sure that the tax-exempt status of credit unions is not challenged,” he said.
Congress has provided the credit union federal tax-exemption because of the not-for-profit, cooperative structure of credit unions, and the special mission credit unions have to serve consumers.
While GAC attendees are preparing their make their congressional visits this week to discuss credit union issues, Merkley implored them to tell their legislators about the danger of regulatory creep.
“Are we making sure that rules that were designed to take on the ‘Wall Street casino’ don’t impinge on the effectiveness and efficiency of our credit unions?” he asked. “We need to make sure that’s not the case, and I hope you can take that message to Capitol Hill tomorrow and the day after, to say ‘Make sure the rules written for predatory practices are not misapplied and damage the credit union system.”
Another member of the Senate Banking Committee, Sen. Elizabeth Warren (D-Mass.), is scheduled to speak at the GAC today. See CUNA’s News Now Thursday for a report on credit unions’ visits with federal lawmakers and regulators.