WASHINGTON (2/23/10)--The House and Senate return to work this week, and while credit unions would not usually be overly concerned by the prospects of a job creation bill, the potential attachment of member business lending changes is meriting some attention. The jobs bill, the Hiring Incentives to Restore Employment (HIRE) Act, was introduced by Sen. Harry Reid (D-Nev.) earlier this month, and would provide tax credits for businesses that create jobs by granting employers social security payroll tax exemptions for any person they hire this year that has been unemployed for at least two months. The bill on Monday passed a cloture vote of 62 to 30. The Credit Union National Association (CUNA) is working with representatives on the Hill to attach legislation that would lift the member business lending cap to 25% of a credit union's assets, and CUNA plans to attach this legislation to a jobs bill at some point this year. Both employment and lending will be covered in congressional hearings scheduled for this week, with the House Financial Services Committee on Tuesday set to discuss whether additional stimulus is needed to create greater employment growth. That same committee on Wednesday will hear from Federal Reserve Chairman Ben Bernanke as he reports on the Fed's Semiannual Monetary Policy Report. Bernanke will also appear before the Senate Banking Committee on Thursday. The House committee will also be active on Thursday and Friday, with hearings on finance industry compensation and the condition of small business and commercial real estate lending in local markets scheduled, respectively. Credit unions and credit union leagues also will be active on the Hill,with plans to hike Capitol Hill to meet with their state representatives. During a legislative update Monday afternoon at the CUNA's Governmental Affairs Conference in Washington, D.C., CUNA’s legislative affairs staff briefed attendees on major legislative issues affecting credit unions. Some of the major issues CUNA staff noted:
* Member business lending (MBL). If caps on credit union member business lending are raised to 25% of assets from 12.25% of assets, $10 billion in new loans could be generated for the economy, creating 108,000 new jobs at zero cost to taxpayers; * Overdraft protection. A proposed bill would limit overdraft charges to one account per month and six charges per year. If this is enacted, credit unions would stop offering overdraft services, which means members would lose the benefit of that program; * Interchange fees, which support the debit and credit card programs that credit unions offer their members. Credit unions need to explain how debit and credit card programs help serve members; * The Community Reinvestment Act, which governs financial institutions to ensure they are adequately serving all aspects of their communities. Credit unions already serve their members and communities, CUNA staff said; and * Regulatory restructuring. The areas credit unions will most be interested in are systemic risk regulation and consumer protection.
CUNA staff leading the session included Ryan Donovan, vice president of legislative affairs; Richard Gose, senior vice president of political affairs; John Magill, senior vice president of legislative affairs, and Elizabeth Furey, director of grassroots advocacy for political affairs.