JEFFERSON CITY, Mo. (3/12/10)--The Missouri Highways and Transportation Commission approved a staff recommendation Wednesday to sever ties with the 10 credit unions located in Missouri Department of Transportation (MoDOT) facilities in the state, according to the Missouri Credit Union Association (MCUA). The credit unions were told Jan. 21 that they would be required to vacate their locations by Sept. 30. They would no longer be able to process payroll and benefits through MoDOT after that date. Credit union employees were on MoDOT’s salary and benefits plan but credit unions fully reimbursed MoDOT for those costs, MCUA said. Following pressure from MCUA, state lawmakers and the Missouri Division of Credit Unions, the final proposal offered to the Highway Commission for approval extended the move-out date to Dec. 31, 2012, and included waiving billing for salary and benefits for one quarter--totaling about $325,000 for the credit unions. However, the credit unions were asked to begin paying rent on their space in MoDOT facilities beginning Jan. 1, 2011. The commission ratified MoDOT staff’s recommendation. At the commission meeting, representatives of MCUA testified on behalf of the credit unions and asked that the decision to sever ties with the credit unions be revisited. Legislators speaking on behalf of credit unions included: Rep. Tom Loehner (R-112), Rep. Mike Parson (R-133), Rep. Tom Shively (D-8), and Rep. Larry Wilson (R-119). Also attending were Rep. Paul LeVota (D-52) and Rep. Bill Deeken (R-114). Testifying on behalf of credit unions were Board Chairman Norm Beeman, District 4 Highway CU, and credit union members Jim Reser, Steve Torbet and Forrest Wrisinger. About 90 people attended the meeting. Peggy Nalls, MCUA senior vice president of public and legislative affairs, said: “We can find no logical, rational reason for this decision. MoDOT claims that it doesn’t know anything about running financial institutions. “They don’t have to; the regulators and NCUA, the insurer, take care of that,” she said. “MoDOT claims that credit unions are not part of their core transportation mission. Credit unions are an employee benefit,” she said. “MoDOT provides dry cleaning services and boot subsidies and any number of other employee benefits,” Nalls continued. “What’s the difference? The only reason we can see for MoDOT taking this action is that Gov. [Jay] Nixon told them to cut full-time employees. They cut employees that work for the credit union so MoDOT won’t have to cut their workforce and won’t have a reduction in personnel expenses.” MCUA CEO Rosie Holub called MoDOT to ask how it announced its intention to sever ties to the credit unions. “The first issue is a lack of inclusion of the state credit union regulatory agency on the impact of this decision on the safety and stability of the affected credit unions,” she said. “The Missouri Division of Credit Unions was neither informed nor consulted prior to [MoDOT] taking a course of action that displaces 10 independent financial institutions totaling $138 million in assets and 18,000 members," Holub added. “If any of these credit unions experience safety and soundness issues, it will be because of MoDOT’s actions and it will be their responsibility,” she said. “MoDOT’s actions are unconscionable.” MCUA will continue working with legislators and the governor’s office on the issue. It also will work with the credit unions, their MCUA assigned field representatives and the Missouri Division of Credit Unions to assist the credit unions through any transition. Credit unions affected by MoDOT’s decision include:
* District One Highway CU, St. Joseph; * District Two Highway CU, Macon; * Division Three Highway CU, Hannibal; * District Four Highway CU, Lee’s Summit; * District Five Highway CU, Jefferson City; * Division Six Highway CU, Chesterfield; * District Seven Highway CU, Joplin; * District Eight Highway CU, Springfield; * District Nine Highway CU, Willow Springs; and * Division 10 Highway CU, Sikeston.