BEAVERTON, Ore. – The pattern is now common nearly everywhere – a declining credit union population is forcing a dramatic change in how state leagues handle governance to ensure equal representation for both big and small CUs, and the issue comes into sharp focus this summer with the election of new directors to the Oregon Credit Union Association. "Because of the problem we've had with very small chapters, we're doing away with a system of letting the 10 chapters elect members to our board and instead are relying on the state's Congressional districts," explained Paul Williams, OCUA chairman and president of Clackamas Community FCU, Oregon City. Under the new format to become effective at the annual OCUA meeting Oct. 21-22 in Portland – but with voting to start in August – a new board will be elected based on a formula of picking two representatives from each of the five Congressional districts. At the same time – and mirroring a trend at nearly half a dozen other state leagues this spring – the OCUA board will drop in size from 16 to 10 reflecting the new configuration. "Since I started here in 1979, we've had a pretty severe drop – 50% – in the number of credit unions in our state from 226 to 100 today," said Williams. In some states, particularly in sparsely populated rural areas like those in Oregon, the CU decline has impacted the League's chapter organization most severely with drops in attendance at regular meetings as well as at educational or fund raising functions. The decline has forced some leagues to merge or dissolve chapters where participation has been lightest. "We've had joint meetings among our four Portland area chapters and they do well, but there is exploratory discussion under way to combine two or three into one," said Danielle Brown, senior vice president of operations for OCUA. At the Illinois League, two small chapters were consolidated last year in Chicago and in Pennsylvania, a chapter in McKeesport was closed down, and another "is in process" at Anthracite. In some states, like California and Texas with big and sprawling Chapter networks, the leagues, better financed than some small states, can devote considerable staff attention to "nurturing or liaison" work, as one executive put it, in keeping the chapter organizations active and involved. Like several leagues studying both chapter health and governance, the Pennsylvania Credit Union Association said its task force on chapters which submitted its report last November recommended a revamping of meeting agendas as one means of drawing more media attention to CU issues as well as to stir political grassroots activity, long considered a vital chapter task. "We asked that our chapters hold four what we called `WOW' meetings a year," explained Diana Roberts, chairman of the task force, in describing a new policy of encouraging the league's 40 chapters to invite civic, political or noteworthy figures in the community or region to talk at meetings with the press invited. Its Harrisburg area chapter drew a big crowd a year ago for an appearance by the Somerset, Pa. trapped miners who recounted their near-death experience in 2002. And there have been successful talks by mayors and state lawmakers at other WOW meetings. "Larry Blanchard of CUNA Mutual, gave a well received talk last month at a Montgomery County Chapter meeting," noted a League spokesman, referring to CMG's senior vice president of legislative and corporate affairs.. Roberts, the Task Force chairman and also president/CEO of Hershey FCU, said overall the WOW idea has met with a modicum of success but some chapters still struggle to come up with attention-grabbing speakers. In Oregon, Casey Wheeler, president of the $100 million St. Helens Community FCU and a member of that league's Chapter Task Force, said the problem with chapter sustenance "is a mix of geography and dwindling numbers." "You know that whole area of Oregon east of the Cascades is one big chapter and it's a challenge" for CU executives to travel for a night's meeting, he said. While some chapters "are extremely active" in networking and education, there are others with few CU members that struggle. "I think there's one chapter on the coast that has four credit unions and at Roseburg they may have three," said Wheeler, the former president of the Idaho League. In California, at least, the geography problem is being met by using the Internet. "We've been using Web cameras and conference calls for our Shasta Chapter meetings," said Mark Moore, president and CEO of Members 1st CU in Redding. There are six active CUs in the Shasta Chapter "and it's a two hour drive" and longer in the winter months for executives to attend functions, so the Web camera idea has been tested this year for quarterly meetings. "We've had a few glitches with the Web cameras and problems with the sound matching the voices so we had to pipe in the sound as a conference call," said Moore but the Chapter intends to keep trying. The problem is just as acute in Montana where the Credit Union Network – recognizing geography constraints – -at its annual meeting May 1 agreed to downsize its "district" system which parallels its chapter network. Effective in 2005, the Montana League said it was establishing a structure for its board that elects directors based mostly on "demographics" and size of CU membership. "At one time we had 200 credit unions in Montana and now we're down to 72,but some of those chapters in the eastern portion of the state had two or three members who elected directors through the district," explained Albert Vukasin, League chairman and president of Bear Paw CU, Havre. Under the new League structure, the number of districts has been reduced from 10 to 3 with some representatives elected at large. ""We're simply trying to stay up to date with changes in the marketplace," observed Tracie Kenyon, president/CEO of the Network. Following along with Montana, the Arkansas League, also acting at its annual meeting in April, said it has reorganized its governance structure and will start using asset size in 2005 to elect board directors In a bylaw change, the trade group is setting up nine asset categories for electing board members, dropping the chapter criteria for picking directors. "Our chapters are doing excellent work but there are areas of the state – particularly in the northeast where we have few left in the chapters – that we had the problem," said Dwayne Ashcraft, League chairman and president of Arkansas Superior FCU, Warren. The election changes take effect next April with election of a new board under the asset format. -

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