NAFCU Compliance Blog

The 12%: The Ballad of the 113th Congress

Written by Katie Marisic, VP of Political Affairs

With all the new regulations about to go in effect in the coming months we thought we’d give you a little break from the normal updates and let you sit back, relax and enjoy what Congress has to offer. But first here is a corgi doing an impression of Congress  trying to pass legislation.

It’s been week after the government shutdown ended and Washington, D.C. is quickly returning to its “normal state.”  Federal employees have returned to work, acrimonious congressional hearings   are being held and the panda cam is back in action.

Next week the budget conference committee tasked with finding a compromise on the Continuing Resolution and Extension of the Debt Ceiling will meet. There was a lot of talk going around that a compromise would involve major tax reform, but yesterday both Senate Majority Leader Harry Reid (D-NV) and House Budget Committee Chairman Paul Ryan (R-WI) appeared to rule out the idea of a grand bargain.

With an approval rating of 12%, and a record of passing legislation that has them on track to be the least effective Congress in American history, the idea to scale back the grandiose rhetoric and focus on something that is achievable seems like a pretty good plan. Here's that corgi again.

But just because tax reform might not be in this compromise doesn’t mean that the issue is going away. Both Sen. Max Baucus (D-MT) and Rep. Dave Camp (R-MI), chairmen of the committees that deal with tax reform have repeatedly expressed their desire to pass legislation this Congress. Sen. Baucus is retiring and Camp’s tenure as Chairman is term limited so both of them have significant interest in making something happen before 2015.

If Congress does a 180, and starts working together anything could happen. It’s important that we keep encouraging them to focus on legislation that is beneficial to credit unions. S. 635, the Privacy Notice Modernization Act of 2013, is one bill that we want to make sure stays on their radar. Similar legislation has already passed in the House and a presidential signature on this bill would be a boon to credit unions.

All of this is assuming they come to a compromise, if the conference committee can’t come to a bargain by December 15 be prepared for round two of shutdowns. But just because Congress might not be able to meet their deadlines doesn’t mean you can miss yours. Make sure your credit union is prepared for all the compliance deadlines by visiting the NAFCU Compliance Calendar.

Before you return to your regularly scheduled program here is one more video to get you through your day.

Have a great weekend!

NAFCU Study on Credit Unions’ Benefit to U.S. Economy; CFPB Credit Union Advisory Council

Written by Bernadette Clair, Regulatory Compliance Counsel

Yesterday, on the opening day of Congressional Caucus, NAFCU released a study on the “Economic Benefits of the Credit Union Tax Exemption to Consumers, Businesses and the U.S. Economy.”  NAFCU commissioned the study to look at the benefits of the credit union federal tax exemption to consumers, businesses and the U.S. economy and to examine what would happen to the U.S. economy if the credit union federal income tax exemption is eliminated.

Key findings of the study:

• Eliminating the federal credit union tax exemption will reduce U.S. GDP by about $148 billion (in 2010 dollars) over the next decade ($14.8 billion per year); resulting in a loss of 150,000 jobs per year, or a total of 1.5 million jobs over the next decade.
• The total benefit to U.S. consumers from the presence of the federal tax exemption for credit unions is approximately $10 billion per year. From 2005-2011, the direct consumer benefit totaled $72.6 billion.
• $1.5 billion per year in federal income tax revenue will be lost due to the reduction in consumers’ personal income as a result of the anticipated reduction in the number of credit unions in the marketplace. 

The authors of the study are Robert Feinberg Ph.D., professor of economics at American University, and Douglas Meade, Ph.D., director of research at Interindustry Economic Research Fund, Inc.

See NAFCU’s press release  and NAFCU Today article for additional details.  More information on the study and the credit union tax exemption can be found here, including a one-page summary of key findings as well as the full study.

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CFPB Credit Union Advisory Council.  The CFPB has announced the selection of 15 credit union representatives to its Credit Union Advisory Council.  The council will provide feedback to the CFPB on its policy development, research, rulemaking and engagement functions.  Those selected include NAFCU nominees John Buckley of Gerber FCU (Mich.), Mitch Klein of Police and Firemen FCU (Pa.), Camille Shillenn of Unified People’s CU (Wyo.) and David Wright of Services Center FCU (S.D.)

The CFPB also named its Community Bank Advisory Council members and members of the new Consumer Advisory Board.  More information on the CFPB’s advisory groups is available here.