A Friend in Kansas, Senator Brownback Speaks Out Against Taxing Credit Unions

WICHITA, Kan. -Another U.S. senator, Sam Brownback of Kansas, has come out against taxing credit unions. In a featured weekend address to the annual meeting of the Kansas Credit Union Association, the Kansas Republican said, “credit unions are about people and character. I would not favor taxing you.” And in a reference to the current federal exemption, Brownback added, “we don’t need to fix something that is not broken.” League leaders were cheered by those remarks and an additional comment he made that he favors passage of the Financial Services Regulatory Relief Act (H.R. 1375) providing expanded CU powers. “I would vote yes for that bill, but it will be difficult to get the measure to the Senate floor this session,” said Brownback in answer to a question posed by William Hauber, CEO of Fort Leavenworth CU. Brownback’s remarks against taxing CUs follows widely-quoted comments made earlier this month by U.S. Sen. Richard Shelby (R-Ala.) and chairman of the Senate Banking Committee, who told newsmen taxing CUs would only hurt CU members and therefore he opposes taxing CUs. Regarding Brownback, the secretary-treasurer of the League, Marilyn Wells, who also is president of Catholic Family FCU of Wichita, said the leadership of the trade group is “happy to hear we have a strong supporter in Sen. Brownback” on the tax issue. She added, however, that on another pressing matter she was disappointed to learn of partisan roadblocks in the Senate over passage of a bankruptcy reform bill. Brownback told the League convention that Senate Democrats have been successful in delaying bills like bankruptcy reform and as a result that legislation might not make it to the floor this session. But Brownback added, “I do have problems with anything that would change current exemptions of the Kansas Homestead protection that we have today.” Wells said bankruptcy reform is a priority among CU executives since under current law “so many people are finding it convenient to avoid debt.” In his keynote address April 17, Brownback philosophized about the passage of more laws but said new laws do not determine how people act but that “it’s more a matter of character and values.” That is why he said he favors the current tax exemption that CUs have earned. At a legislative luncheon during the conference, state Sen. Larry Salmans (R-Hanston) was honored with the “Legislative Recognition Award” for being outspoken in standing up for CUs a year ago at the National Council of State Legislators Conference. Salmans had been a “forefront voice” in opposing removal of the federal tax exemption on CUs. The Kansas lawmaker had stood up in committee to voice his objection stating, “it was the right thing to do.” Also at the League convention, State Treasurer Lynn Jenkins expressed her support to Kansas CUs for helping fund a financial literacy camp for teenagers this summer on 4-H land near Junction City. Apart from the “MoneySmart Financial Management Camp,” Jenkins also discussed a pilot “Save in School” program being piloted by Kansas State University FCU in Manhattan and Kansas University CU in Lawrence. -