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Information Central Resources GA Update Archives Regulatory Roundup Information Central Contacts Andrew Doerr - Director of Legislative Affairs Nancy Short - Political Affairs Manager Kathryn Hall - Association Services Assistant Angela Hall - Administrative Assistant

GA Update - March 2008 

 Michigan CUs Descend on Washington, Post Record Attendance at CUNA GAC

The 2008 CUNA Governmental Affairs Conference (GAC) has come and gone and Michigan was well represented with a record 126 credit union officials in attendance. That total surpassed the previous record of 122 set in 2006. After 31 years at the Washington Hilton and Towers, the CUNA GAC moved downtown to its new home at the Washington Convention Center. This new location allowed Michigan attendees a number of exciting opportunities including a Michigan Welcome Reception; daily hospitality suite; and a room block at the Renaissance Hotel. While the convention sessions and hospitality options were a huge success, the main reason for being there was to lobby Michigan’s members of Congress on the Credit Union Regulatory Improvements Act (CURIA) and other important issues. More than 90 people attended the Michigan Delegation Congressional Breakfast on March 5 in the Rayburn House Office Building where U.S. Rep. Joe Knollenberg, R-Bloomfield Hills, and Matt Mika, Senior Legislative Aide to U.S. Rep. Tim Walberg, R-Tipton, received the MCUL Federal Lawmaker and Staffer of the Year Awards, respectively. In addition, Michigan credit union officials met with all 17 members of Michigan’s Congressional delegation or their respective staff members.

It wasn’t the homerun credit unions had been seeking, but the U.S. House Financial Services Committee held its first hearing on credit union regulatory relief in almost 10 years during the 2008 CUNA Governmental Affairs Conference (GAC). However, the hearing was not focused on the Credit Union Regulatory Improvements Act (CURIA, H.R. 1537) and its 145 co-sponsors in the House but rather the newly introduced Credit Union Regulatory Relief Act (CURRA, H.R. 5519) introduced March 3. NCUA Chairman JoAnn Johnson and CUNA Chairman Tom Dorety of SunCoast Schools FCU in Florida were among the credit union witnesses to testify. The testimony focused mostly not on what was in fact included in H.R 5519, but rather on the two important provisions that were omitted — reforming prompt corrective action (PCA) rules and raising the current cap on member business loans from 12.25 to 20 percent.  Honing in on PCA reform as her top priority as a regulator and a "necessary tool," Johnson said a risk-based capital system, more aligned with that of the banking and thrift industries, would improve the current credit union "regulatory regime" and "put more money in the members' hands." U.S. Reps. Barney Frank, D-Mass., Paul Kanjorski, D-Pa., and Ed Royce, R-Calif., have urged for quick action on CURRA.

The Michigan House and Senate have both acted on the Michigan State Housing and Development Authority legislation. Both chambers passed each other’s versions of the initiative, known as “Save the Dream.” The bills allow the Michigan State Housing Development Authority (MSHDA) to offer home re-financing products to qualifying borrowers whereas currently MSHDA is only able to do purchase loans. The package of bills would also increase the income cap limits threshold for those seeking a MSHDA loan to $108,000 and allow MSHDA to create the ARM Assistance Refinance Program (ARM) and the MSHDA Rescue Refinance Program. These refinancing programs are designed to help homeowners in good standing refinance their loans at a lower interest rate. It also includes a three-year limit on the refinancing programs and requires MSHDA to provide an annual report to the Michigan Legislature.  The bills are expected to be signed into law by Governor Granholm April 2.

The excitement is building for the 2008 MCUL Governmental Affairs Conference (GAC). Registration is now open for the popular annual event at http://www.mcul.org/2008_MCUL_GAC_1443.html. The 2008 GAC features Fox News Political Correspondent Morton Kondracke as the keynote speaker; Senior Capital Correspondent Tim Skubick moderating a discussion between State Party Chairmen Mark Brewer and Saul Anuzis; OFIS Commissioner Ken Ross; and Ford Motor Company Senior Economist Emily Kolinski Morris. To date, more than 65 credit union officials have already registered. Questions regarding the conference should be directed to MCUL Political Affairs Manager Nancy Short at Ext. 353 or nes@mcul.org.

The House Democratic Caucus has introduced a series of bills designed to increase penalties for elder abuse and expand the definition of abuse to include financial exploitation. The lead sponsor of the package, State Rep. Mark Meadows, D-East Lansing, indicated the bills are partially in response to the recommendations of Governor Granholm’s 2006 Task Force on Elder Abuse. The bill package would require that state-chartered financial institution employees report cases of suspected financial exploitation to the Department of Human Services (DHS). Additionally, H.B. 5731, would require credit unions to provide a written summary of each account holder’s rights and responsibilities under a joint account. The MCUL, Michigan Bankers Association (MBA) and others have expressed numerous concerns regarding the bills, mainly that this requirement is already found in the Truth in Savings Act and would be duplicative. MCUL staff testified in opposition to H.B. 5731 in committee on March 12. As written, the legislation places undue burdens on state-chartered financial institutions and may harm relationships with credit union members as it raises privacy concerns.

MCULLAF/MCULAF both continue to charge ahead in 2008, raising more than $40,000 in February alone. As of March 20, the combined fund-raising total for MCULLAF (federal) and MCULAF (state) was $76,974 or 18 percent of the overall goal. During that same timeframe, $56,847 (38 percent of goal) had been raised for MCULAF, up more than $16,000 from the same time in 2007. MCULLAF reported $20,127 (7 percent of goal), an increase of $7,000.  

The Michigan Senate recently passed S.B. 786 by a vote of 34-2. Sponsored by State Sen. Wayne Kuipers, R-Holland, the bill raises the monetary ceiling in the Small Claims Division of the District Court from $3,000 to $5,000. Since the Michigan Legislature established the Small Claims Division in 1968, the monetary ceiling has been increased on four occasions, most recently in 1999. While the bill would make the Small Claims Division more accessible to parties, either party could, as now, have the case removed to the General Division of the District Court. A similar bill was introduced earlier in the legislative session by State Rep. John Pastor, R-Livonia. S.B. 786 has been transmitted to the Michigan House of Representatives and referred to the Judiciary Committee, chaired by State Rep. Paul Condino, D-Southfield. MCUL Governmental Affairs staff has met with Rep. Condino and his staff. He supports raising the monetary ceiling and did indeed vote “yes” on a similar bill in 2006 that would have raised the ceiling.

H.B. 5723, the final piece of the IDA legislation signed into law in 2006, passed the Michigan House of Representatives Feb. 28 by a vote of 106-0. Bill sponsor State Rep. Steve Bieda, D-Warren, who also chairs the House Tax Policy Committee, was invaluable in completing the quick action. The bill would allow businesses with Michigan Business Tax (MBT) liability to seek a credit for a qualified contribution to an Individual Development Account (IDA) program site. State Sen. Tupac Hunter, D-Detroit, introduced similar legislation in the Senate in January. S.B. 1020 has been referred to the Senate Finance Committee, chaired by State Sen. Nancy Cassis, R-Novi.

After lengthy negotiations between Michigan House and Senate leaders, legislation addressing loan officer licensing was passed and signed by Governor Granholm. The companion House and Senate versions require individuals employed by mortgage brokers to be licensed. Currently, only the mortgage broker is required to be licensed. The new legislation pertaining to individuals will require that potential loan officers submit to criminal background checks, in addition to other provisions. Under this legislation, a loan officer is defined as an individual who is employed by only one mortgage broker, mortgage lender or mortgage servicer who originates the loan. MCUL Governmental Affairs staff succeeded in exempting depository institutions from this legislation, including credit unions and CUSOs.