Utah League Preps for Legislative Fight With Info `Assault' Packets

SALT LAKE CITY – In preparation for a looming legislative battle with banks over the tax exempt status of credit unions, the Utah League of Credit Unions mailed informational packets over the holidays to all Utah legislators and the media warning of “a multi-million dollar assault” and “misinformation” campaign against the industry in 2003. The packets, the first segment of what is certain to an extensive media campaign by both the League and the Utah Bankers Association, includes a video entitled “Did You Know a Tax on Utah Credit Unions Is a Tax on You.” The packets, which also contain news clips and a fold-out flier also titled “Did You Know” detailing the expected “media blitz” to be waged by the banking lobby, were sent out to a group of 275 which included the CEOs of Utah CUs. The packets were produced by the Summit Group, a Salt Lake advertising and public relations firm. The video and fliers warned that the banking industry in its “attack” on CUs will be undertaking a variety of “tactics” to convince lawmakers to tax those large state-chartered CUs, particularly Mountain America CU and America First CU, which the banks accuse of acting like unregulated commercial banks because of their field of membership and business loan expansion. The state legislature which opens its 2003 session Jan 20 is likely to receive a bill requiring Mountain America and America First to convert to mutual savings banks so they can be taxed, said a League spokesman.. Similar bills introduced by the Utah Bankers Association. during past sessions were defeated. The League’s fold out flier suggested that the banks are targeting Mountain America and America First because of their large membership in the state – “450,000 consumers who chose credit unions over banks.” The flier also took aim at the so-called “Resolution Alliance of Credit Unions and Banks” and “Concerned Citizens” as groups described by the League as “fronts” for the Utah Bankers Association suggesting that both are part of a “deceptive” campaign waged by the UBA to fool Utah consumers to think these organizations are “neutral third party groups.” The flier also stressed that the charter of Utah CUs “is much more restrictive than the federal and surrounding state charters.” NCUA recently released new regulations, said the flier, “that are considerably less restrictive than before they were lagging behind most states. In other words, Utah’s 1.2 million credit union members are more restricted than the rest of the nation.” Moreover, the flier continued, Utah CUs “labor under a regulatory burden that is much more restrictive than even the federal charter” and as a result state chartered CUs are “in the process of moving to a federal charter to avoid the oppressive nature of Utah’s regulations.” -