Credit Union Advocacy Breaks Through in 2018, Poised for 2019

2018 was a watershed year for CUNA/league/credit union advocacy. Our accomplishments last year during a turbulent political time stand out over any of the last 20 years of credit union advocacy, making it a story that deserves to be told. And as we consider all of our 2018 wins, we are ready more than ever before to take on a new year and new Congress.

In a period of political turbulence, credit unions led the way to convince Congress to enact the first major piece of regulatory relief legislation since 2006. And unlike that previous effort, this legislation included several important credit union priorities, including amendments to the Dodd-Frank Act to reduce regulatory burden, a provision that holds the NCUA accountable by requiring it to hold an annual hearing on the budget, and a provision that protects credit union officials that report suspicion of elder abuse.

Importantly, this legislation also carried a major charter enhancement provision, exempting one- to four-family non-owner occupied loans from the member business lending cap. Taken together with our success on the NCUA’s MBL rule, which exempts from the cap loan participations purchased from other credit unions, we can officially declare final victory on the system’s 20-year battle to restore credit union business authority.  Indeed, these two changes will provide more cap space than we had been seeking in the old Royce-Udall legislation that aimed to raise the cap to 27.5%.

CUNA, leagues and credit unions also aggressively and successfully urged the CFPB to fix burdensome rules and slow the pace of new rules. Our advocacy also helped remove overdraft protection from its rulemaking agenda. In addition, we were the only trade association to stand with the administration in support of its authority to name an interim director of the bureau, filing an amicus brief in the litigation.  And, we gave the new bureau leadership a roadmap for the future by responding to each of its 13 requests for information and publishing a comprehensive white paper on the future of the bureau.

Working together, CUNA, leagues and credit unions held the NCUA accountable to their commitment to modernize the agency and reduce regulatory burden. After advocating for years for a more reasonable budget, the NCUA produced a budget that more consistently and more appropriately reflects the size and complexity of credit unions.  At our urging, the NCUA delayed the implementation of its risk-based capital rule and narrowed its scope. And we were one of two national associations to support the NCUA’s decision to close the Temporary Corporate Credit Union Stabilization Fund and pay dividends to credit unions as opposed to charging credit unions premiums.

But that’s not all – CUNA, leagues and credit unions also successfully advocated for the Financial Accounting Standards Board to delay the implementation of the CECL accounting standard; we successfully removed a provision from the National Defense Authorization Act that would have put credit unions at a disadvantage when serving members on military bases; we maintained funding for key community development programs; we held merchants that allow data breach accountable; we stood with credit unions facing frivolous litigation related to website accessibility under the Americans with Disabilities Act; and, importantly, we protected the credit union tax status at the federal and the state level.

This type of success would be remarkable for a five-year period, but we were able to achieve it in one year for a host of reasons. Over the last four years, CUNA and the leagues have fundamentally changed the way we do advocacy. We tore down internal silos and recommitted ourselves to a stronger cooperative relationship. The result has been our 360-degree advocacy strategy – an approach that we will be carrying into 2019.

This year will be all about translating the momentum from 2018 into more wins for credit unions. We have a lot on the agenda, including continued pressure on the CFPB and NCUA; modernizing the Bank Secrecy Act; expanding data security regulations to merchants; reducing restrictive privacy regulations; pursuing Federal Credit Union Act Modernization legislation; and as always preserving the credit union income tax status.

2019 is going to be an exciting and challenging year, but credit union advocates everywhere are ready and eager to be successful.

Ryan Donovan is Chief Advocacy Officer for CUNA. He can be reached at 202-508-6750 or rdonovan@cuna.coop.