Strengthening State Credit Union Charter Focus of Discussions Between NYSCUL, SCCUs, State Banking Dept.

LATHAM, N.Y. – Only about 6% of all the credit unions in the Empire State are state-chartered, but the New York State Credit Union League wants to make sure they are not at a disadvantage to federal credit unions doing business in the state. Representatives from the New York State Credit Union League and state-chartered credit unions met with key staff of the New York State Banking Department the week of Dec. 2 to discuss a strategy to legislatively and regulatively strengthen the state credit union act and give SCCUs parity with FCUs. Considering that New York State is still dealing with the financial effects of 9-11, as well as a budget shortfall crisis similar to those other states are facing, NYSCUL Government Affairs Director Amy Kramer said “the League doesn’t want to ask the state legislature for anything that could have a revenue impact.” For example, Kramer explained that state-chartered CUs pay a state sales tax, but FCUs don’t. Even though the League wants that “inequity” discontinued so SCCUs wouldn’t pay the tax, she said the League realizes “now is not the time to bring the issue up.” But she added that, “At the same time, we’re not just going to sit idly by while state-chartered credit unions don’t have parity with federal credit unions. We’ll find some other way to give them parity” Included in the proposals the CU group presented to Deputy Banking Superintendent of Banks Anthony Calabrese was SCCUs’ inclusion in the state banks’ wild card’ law. That law allows state banks to do anything federal banks are authorized to do, as long as they receive the approval of the state regulator. Kramer said the law expires in 2003, and the League wants the state legislature to include credit unions in the law when it comes up for renewal. A recently formed advisory group of representatives from 12 state-chartered credit unions has been studying the state credit union act and focusing on the general powers section with the objective of bringing it more in line with the powers allowed federal credit unions. Kramer said the group also wants to clarify the language in the section and “keep the definitions in line with the federal credit union act.” Kramer pointed out that legislative changes aren’t the only approach the League is pursuing to achieve its goals. She said the New York State Banking Department is also open to making regulatory changes. “State-chartered credit unions may currently be in the minority of all the credit unions in New York State, but we want to make sure the charter remains attractive for them and any federal credit union that may consider converting its charter,” said Kramer. [email protected]