TRENTON, N.J. (3/18/09)--Legislation to temporarily expand the range of investment vehicles for New Jersey Cash Management Fund and state pension fund moneys so credit unions have equal footing with banks passed the Senate Monday, 37-0. The legislation (S-2552), sponsored by Senate Majority Leader Steve Sweeney (D-3), authorizes the director of the state Division of Investments for the funds to invest in any obligation guaranteed by either the Federal Deposit Insurance Corp. (FDIC) or the National Credit Union Share Insurance Fund (NCUSIF). Existing statutes do not recognize NCUSIF insurance. Similar to Government Unit Depository Protection Act of 1970 (GUDPA) legislation pending in both state houses, S-2552 marks only the second time it's been proposed that credit unions be given equal footing with FDIC-insured depositaries for state and local government funds. Assembly Financial Institutions and Insurance Committee Chairman Gary Schaer (D-36) introduced a companion bill, A-3817, in the Assembly earlier this month. However, Schaer held the measure just before it was to be considered by the Assembly Appropriations Committee last week. The New Jersey Credit Union League submitted a formal statement of support to the Senate committee and will do the same on the Assembly side when consideration is rescheduled. Although they have not filed formal statements or testified, both the New Jersey Bankers Association and the New Jersey Business and Industry registered their support when the Senate committee considered the bill. They are expected to do the same for the Assembly bill, said the league. The legislation is intended to spur economic growth by creating additional lending capacity among New Jersey depositories, enabling them to make more and less expensive capital available to small businesses and individual borrowers. Sen. Sweeney is sponsor of legislation to amend GUDPA to enable credit unions to become eligible depositories for New Jersey's counties, school boards and municipalities as well. The league expects the municipal deposits measure, pending in both houses, to receive committee consideration when the legislature returns from its annual budget break in early June.