FEDERAL WAY, Wash. -- Joining CUNA's hard-line campaign to defeat the Treasury's regulatory reorganization plan, the head of the Washington Credit Union League Friday called the package "inexcusable" and badly flawed but finds there are positives and CU opportunities since "re-regulation is inevitable."

Like other state league president/CEOs, John Annaloro of the 130-member CU Washington group fired off stern opposition letters this week to Treasury Secretary Henry Paulson but also said the "Blueprint" draft, once fixed, "potentially offers a vastly more interesting CU future."

That's because CUs "could then have all the powers of national banks and full business lending powers, no FOM restrictions unless self-imposed in the board room, and lower capital standards."

Annaloro emphasized that the tax exemption section of the "Blueprint" would have to be vastly rewritten to empower only those "federally insured deposit institutions that are cooperatively structured, operate on a nonprofit basis, have unpaid directors and no equity ownership for CEOs and executives."

"There would also have to be assurances that small CUs becoming FIDIs would not be crushed beneath additional regulatory burdens," he said adding, however, "this is an "an achievable agenda. In other words, "in exchange for participation in the broader federal objectives, diminished state oversight and possibly CRA, we might see a fresh start with new regulators and full powers for future global competitiveness," maintained Annaloro.

In acknowledging what he said is an "opportunistic role" on this issue among his peers, Annaloro said he has already shared his views with others CU leaders but has not received much feedback. "It's early," he said noting the lengthy industry debate ahead on this issue.