Search
 

Two Michigan Editorials Support CU Expansion

DETROIT and LANSING, Mich.-Two recent editorials in Michigan papers have backed credit unions in their fight to be able to expand their services. State Senator Shirley Johnson (R-Royal Oak) has introduced legislation (Senate Bill 496) to modernize the state's credit union law after 20 years, The Detroit News editorial noted....

By Staff Writer | Updated on September 16, 2003

DETROIT and LANSING, Mich.-Two recent editorials in Michigan papers have backed credit unions in their fight to be able to expand their services. State Senator Shirley Johnson (R-Royal Oak) has introduced legislation (Senate Bill 496) to modernize the state’s credit union law after 20 years, The Detroit News editorial noted. It highlights banker complaints that credit unions should not be able to expand because they are not paying taxes. “But the fact is,” it read, “credit unions don’t pay state and federal income taxes because they are nonprofits, not because of the size of their customer base. Banks make profits, which are distributed to shareholders. Credit unions can’t.” The editorial also pointed out, “Credit unions have a choice to be chartered by the state or federal governments. About two-thirds of Michigan’s 450 or so credit unions are chartered by the state, not the feds. If the state does decide to apply the state Single Business Tax to Michigan credit unions in exchange for modernizing the credit union code, they will simply switch to federal charters. They would still be exempt from federal income taxes.” This could cost the state up to $10 million. Another editorial by Gary Gosselin of The Daily Oakland Press called the Michigan credit union modernization legislation “only fair.” This editorial also noted credit unions not-for-profit difference. “It’s a matter of parity, say the banks, a level playing field, say the banks, a competition of equals, say the banks. Phooey,” it read. Gosselin said that credit unions only represent 2% of the financial services industry nationally and, in Michigan banks have 85.4% of the bank/credit union sector. He added, “In Michigan, all credit unions combined have $26 billion in assets. Comerica, Standard Federal and Fifth-Third Bank EACH have that much in assets.”

Complete your profile to continue reading and get FREE access to CUTimes.com, part of your ALM digital membership.

Your access to unlimited CUTimes.com content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Critical CUTimes.com information including comprehensive product and service provider listings via the Marketplace Directory, CU Careers, resources from industry leaders, webcasts, and breaking news, analysis and more with our informative Newsletters.
  • Exclusive discounts on ALM and CU Times events.
  • Access to other award-winning ALM websites including Law.com and GlobeSt.com.

Already have an account?

NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

Recommended Stories

Credit Union Times

Join Credit Union Times

Don’t miss crucial strategic and tactical information necessary to run your institution and better serve your members. Join Credit Union Times now!

  • Free unlimited access to Credit Union Times' trusted and independent team of experts for extensive industry news, conference coverage, people features, statistical analysis, and regulation and technology updates.
  • Exclusive discounts on ALM and Credit Union Times events.
  • Access to other award-winning ALM websites including TreasuryandRisk.com and Law.com.

Already have an account? Sign In Now
Join Credit Union Times

Copyright © 2024 ALM Global, LLC. All Rights Reserved.