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Michigan Credit Union League

Recent Advocacy Successes

State Level: Appropriation Priorities Funded in FY22 Budget

(Support) On September 22nd, 2021, the Michigan State House and Senate sent a FY22 budget to the Governor for her signature. Around $53 billion in spending made up the FY22 budget. With additional funds left on the table to likely be included with ARPA (American Rescue Plan Act) dollars in a FY22 supplemental(s) later this year.

Included in this FY22 budget are $1.5 million for the Michigan Saves program. This programs residential arm is entirely done by 7 of our credit unions and provides energy efficiency home loans for members. This funding was one of our FY22 budget priorities and we are very thankful that it was included in the final budget deal.

Another appropriations priority for our team that was included in the FY22 budget was $2 million in funding for Children’s Savings Accounts. $1 million of this funding can be utilized to open accounts for children and bolster existing programs and the other $1 million is for administration and creation of two pilot programs (one rural and one urban).

The Housing Assistance Fund (HAF) money of approximately $250 million for helping to help homeowners get current with their mortgages and utilities had about half of the approximately $250 million authorized to be spent. Additional FTEs (full-time employees) were also provided for in the FY22 budget for this program. We expect the remaining HAF funds to be included in a ARPA supplemental later this year or even a current year supplemental in early 2022.

State Level: Extension of Electronic and Remote Notarizations

(Support) On December 30th, 2020 the Governor signed SB 1186-1189 introduced by Sen. Peter MacGregor. This package of bills extends the ability for businesses to utilize alternative means to conduct electronic and remote notarizations of documents through June 30, 2021. Previous legislation introduced by Rep. Sarah Lightner extended the ability to conduct these transactions under the previous EO guidance through December 31st, 2020. This legislation simply pushes out the timeline for validity of transactions carried out under alternative means even further than the first package. These bills are now PAs 335-338.

State Level: Extension of Driver’s License Validity

(Support) On December 30th, 2020 the Governor signed SB 73 and SB 74 introduced by Sen. Stephanie Chang and Sen. Erika Geiss. The legislation extends the validity of expired driver’s licenses and enhanced driver’s licenses out to March 31st, 2021. Previously driver’s licenses and enhanced driver’s licenses that had expired were valid through December 11th, 2020 and at that point were no longer deemed valid. These bills are now PA 304 & 305.

State Level: Financial Exploitation and Abuse of Vulnerable Adults

(Support) The MCUL worked with the AG’s office, MBA and APS among others to create a package of bills seeking to protect vulnerable adults from financial exploitation and abuse. Sen. Pete Lucido introduced SB 464, 465 and 862 require credit unions and other financial institutions to have a policy in place for training and report of suspected financial exploitation and abuse of their vulnerable members. The legislation was recently signed by the Governor and are now PAs 344-346. Our team will be working with our compliance resources to create a model policy to share with member credit unions in 2021.

State Level: Payday Lending Expansion

(Oppose) The MCUL was able to with a coalition of other trade associations and groups successfully oppose HB 5097. The legislation introduced by Brandt Iden would allow payday lenders in the state to offer a new small dollar installment loan product with an 11% monthly fee and a term of 90 days to 365 days and a dollar amount of up to $2,500. We believe that this product as outlined was extremely predatory and would further trap people in a debt spiral. The legislation was removed from the Senate Regulatory Reform committee due to lack of support by the committee. We expect this legislation to be reintroduced in some form in 2021.

State Level: COVID-19 Employer Liability Limitations

(Support) On November 5th, legislation introduced by Representative Sarah Lightner (HB 6294-6297) was signed by Governor Whitmer. The legislation sought to codify many of the provisions included in the Governor’s Executive Orders (EOs) on electronic/remote notarization transactions. Our team along with other stakeholders worked with the bill sponsor and others in the legislature to ensure that language was adopted that ensure that transactions conducted under the guidance of the EOs continued to be valid following the April 30th, 2020 date set by the Supreme Court. Furthermore, the legislation also allows credit unions and others to continue to transact electronic and remote notarizations as they were under the EOs until the end of the year. These bills are now Pas 246-249 of 2020.

State Level: Criminal Justice Reform (Expunction)

(Support) The Michigan Credit Union League in addition to a number of other businesses joined in a coalition to assist with meaningful criminal justice reform as it relates to expunction of crimes (Public Acts 187-193 of 2020). Our team felt in necessary to join in the coalition to ensure that the Michigan financial services industry had a seat at the table. Our team worked to ensure that under this package citizens of Michigan had the opportunity to have low level crimes expunged from their record automatically after a period of time as long as a number of criteria is also met. This will allow many Michigan citizens to be able to seek additional employment opportunities and begin to build a strong foundation for themselves and their families. Our team worked to ensure that the legislation did not include certain offenses specific to financial institutions as those that are available for automatic expungement. These types of crimes including crimes of character, financial crimes and others are still available to be expunged however, they must be done through the traditional measures. The legislation also has adequate protections in place for employers as it relates to hiring. Our team is extremely pleased to have been a partner in this legislation and having a hand in making Michigan one of the leaders in criminal justice reform of this kind.

State Level: Appropriations Wins for FY21

(Support) The Michigan Credit Union League is very pleased to share that two of our budget priorities were included in the signed FY21 budget. The first of these two priorities being funding for e-recording process upgrades for counties who do not currently e-record property document or who’s systems need upgrades. Our team was able to secure $600,000 in funding for this project. We look forward to working with the department on this effort. We also were able to secure $1 million in funding for the Michigan Saves program. The Michigan Saves program has a number of credit union partners who are offering energy efficiency loans to their members utilizing this program. We are extremely pleased that both of these priorities were included despite the deficit.

State Level: GSE Investment Authority

After nearly five months of work by Chuck Holzman, Dow Chemical Employees CU and assistance from MCUL, DIFS Director Pat McPharlin issued Order No. 18-063-CU, granting Michigan’s state-chartered credit unions the authority to invest, without limitation, in Fannie Mae, Freddie Mac, FHLB and FCS. The order highlights the following:

  • Domestic credit unions may invest, without limitation, in the obligations of Fannie Mae, Freddie Mac, FHLB and entities in the FCS in a safe and sound manner.
  • Domestic credit unions do not currently have authority under state or federal law or regulations to invest, without limitation, in the obligations of Fannie Mae, Freddie Mac, FHLB and entities in the FCS.
  • Competing providers of financial services already have authority to invest, without limitation, in obligations of Fannie Mae, Freddie Mac, FHLB and entities in the FCS, thereby placing domestic credit unions at a competitive disadvantage if they do not have the same authority.
  • Granting this additional authority is appropriate and necessary to enable domestic credit unions at a competitive disadvantage if they do not have the same authority.

Federal Level: Support Commonsense Regulatory Reform

(Support) S. 2155, the Economic Growth, Regulatory Relief and Consumer Protection Act, relieves credit unions and other small community financial institutions of a significant level of regulatory burden. The bill was signed into law (P.L. 115-174) by President Trump on May 24, 2018. For credit unions and small banks with under $10 billion in consolidated assets — every credit union in Michigan — the bill established a safe harbor from certain requirements for a loan to be considered a Qualified Mortgage for purposes of the Ability to Repay Rule, so long as the loan is held in portfolio by the credit union.

The bill also includes changes to HMDA reporting requirements by rescinding the additional data points required under HMDA for insured credit unions that originate fewer than 500 closed-end and/or 500 open-end lines of credit. Section 105 of the bill was included specifically for credit unions and it provides parity between credit unions and banks with regard to 1-4 non-owner-occupied units. The provision allows credit unions to classify loans for these types of properties as residential real estate loans, as banks currently do, rather than business loans.

Below are some additional provisions contained in the bill that are beneficial to credit unions:

  • Section 109 removes the three day waiting period required for the combined TILA/RESPA mortgage disclosure if a creditor extends a consumer a second offer of credit with a lower annual percentage rate.
  • Section 216 requires the U.S. Treasury to study the risks that cyber threats pose on financial institutions.
  • Section 303 provides legal immunity to properly trained financial service employees who disclose concerns about financial exploitation of senior citizens.
  • Section 307 addresses long-held concerns about Property Assessed Clean Energy (PACE) loans, primarily that the same consumer protections in place with respect to mortgage lending are nonexistent for PACE loans.

For several years prior to the passage of S. 2155, MCUL and Michigan credit union advocates met with members of the Michigan congressional delegation and their staff to educate them on the impact that burdensome regulations have on credit unions and credit union members — their constituents. These advocacy efforts peaked in the spring of 2018 when credit unions leaders met with members of Congress during the CUNA GAC and requested support for S. 2155. During that period, credit union advocates also sent some 1,700 messages to delegation members, placed calls to their offices and submitted op eds to local media outlets in support of S. 2155.

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Federal Level: Protect the Credit Union Not-for-Profit Tax Status

(Support) On December 22, 2017 President Trump signed into law H.R. 1, the Tax Cuts and Jobs Act (P.L. 115-97). The bill made significant changes to the U.S. tax code including lowering tax rates for individuals and corporations. As it pertains to credit unions, MCUL’s primary objective was to ensure language was not included in the bill that would in any way alter the credit union not-for-profit tax status.

the weeks and months leading up to final passage of the bill, MCUL and credit union advocates met with members of the delegation during Hike the Hill, CUNA GAC and at in-district/state meetings to educate them on the credit union difference, the importance of the credit union tax status and to urge legislators to oppose any effort that would change the credit union not-for-profit tax status. addition, all fourteen Michigan members of the House and both of U.S. Senators provided MCUL with statements supporting the tax status.

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GSE Investment Authority — DIFS Order

After nearly five months of work by Chuck Holzman, Dow Chemical Employees CU and assistance from MCUL, DIFS Director Pat McPharlin issued Order No. 18-063-CU granting Michigan’s state-chartered credit unions the authority to invest, without limitation, in Fannie Mae, Freddie Mac, FHLB and FCS. The order highlights the following:

  • Domestic credit unions may invest, without limitation, in the obligations of Fannie Mae, Freddie Mac, FHLB and entities in the FCS in a safe and sound manner.
  • Domestic credit unions do not currently have authority under state or federal law or regulations to invest, without limitation, in the obligations of Fannie Mae, Freddie Mac, FHLB and entities in the FCS.
  • Competing providers of financial services already have authority to invest, without limitation, in obligations of Fannie Mae, Freddie Mac, FHLB and entities in the FCS, thereby placing domestic credit unions at a competitive disadvantage if they do not have the same authority.
  • Granting this additional authority is appropriate and necessary to enable domestic credit unions at a competitive disadvantage if they do not have the same authority.
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