Welcome to the July 2020 Priority Report. This is our second quarter edition where we dig a bit deeper into our updates. We hope that this report finds you healthy, and enjoying this beautiful Michigan summer weather.
Before jumping into our departmental updates, I want to take a moment and highlight the great work our credit unions have done in response to the COVID pandemic. As you know, we have been tracking credit union activities with small businesses through the issuing of Paycheck Protection Program (PPP) loans and member relief services such as loan modifications and fee waivers.
Throughout the second quarter, Michigan's credit unions have assisted more than 10,000 small businesses obtain nearly $600 million in PPP loans, 10% of which are for new credit union members who found the help they needed when turning to their local credit union. These loans helped keep our Main Street businesses operating, with a median size around $20,000 per loan. The next step is the loan forgiveness process where we continue to work with lawmakers on legislation that helps streamline the process.
In addition to PPP initiatives, our Michigan credit unions have done outstanding work assisting members with mortgage relief, making every effort to keep people in their homes during this crisis. An estimated 14,000 homeowners owing more than $1.9 billion in mortgage loans have received assistance with mortgage payment delays, and more than 300 have had foreclosures postponed.
Moreover, members in need were issued more than 250,000 skipped payments resulting in more than $1 billion payment delays due to financial hardship related to temporary income loss. Add in another $23 million in emergency loans and $800 million in auto and consumer loan modifications, the impact on our members lives is significant.
These types of numbers are very powerful for members looking for healthy financial relief, as well as legislators who need to understand the essential services our not-for-profit movement is providing right now. This is just a snapshot of the data we have been able to collect throughout the second quarter. I invite you to visit our website to review the full press release.
Also, I would like to highlight our new CU Link creative videos that are now live and available to our credit unions on our CU Link page. We are proud of these Michigan messages that showcase how in these tough economic times, credit unions have again come through for their community. They also focus on how, now more than ever, members can benefit from low rates and fees. These adds bring us back in alignment with the Open Your Eyes campaign and we will continue these types of message through the rest of the year.
I would also like to take a minute to thank the members of our two prominent MCUL task forces that have been meeting for the last several months. We have gained tremendous input from the members of our COVID Response and Recovery Task Force and our Small Business Association PPP Task Force. Both groups continue to meet and advise us on how we can better serve you and help you serve your members.
Kicking things off with advocacy, I want to start in Washington, DC., where the U.S. Senate is expected to introduce, debate and vote on Phase 4 emergency stimulus legislation in the coming weeks. The Republican-led chamber will likely focus its bill on business protections, fall school openings and job creation. It’s likely the bill will also include some level of funding for state and local governments, as well as health care providers dealing with increasing COVID-19 cases and American citizens, be it through stimulus checks or tax credits.
As you may recall, the U.S. House Phase 4 bill that passed in May, called the HEROES Act, included approximately $3 trillion in funding. The Senate is expected to try to keep their bill closer to $1 trillion. The HEROES Act included several provisions that concerned us, primarily those that created moratoriums on foreclosures, evictions, consumer debt and small business debt.
While the HEROES Act was deemed to be dead on arrival in the Senate by Republican leadership, Republicans will need to negotiate with their Democratic colleagues to secure the necessary 60 votes needed to pass a bill. We have communicated our concerns to both of our U.S. Senators and urged them to work with their Senate Democratic leaders to keep this language out of the bill.
We also discussed the positive provisions of the HEROES Act with the Senate offices and requested they support and work to have these provisions included in the bill that’s ultimately passed. This includes language that establishes a $75 billion Homeowner Assistance Fund, provides $100 billion for rental assistance, directs $1 billion in funding for the CDFI Fund and includes reforms to PPP.
While we wait, we’re pleased to see Congress come together and work on PPP recently, extending the application deadline to August 8. In addition, Sen. Kevin Cramer introduced legislation that would provide small businesses with PPP loans of $150,000 or less with automatic forgiveness. The hope is to have the legislation added to any coming Phase 4 emergency stimulus bill. We’ll keep you apprised of any developments around PPP, Phase 4 legislation and other credit union federal legislative priorities.
On the state side, the legislature has begun their summer break with only a handful of session days scheduled between now and September. Prior to the legislature’s departure, they presented the Governor with a bill that suspended the July 1 deadline for the FY 21 budget. This will allow the Governor and the legislature additional time to find ways to address the $3 billion deficit.
Our team is working to oppose HB 5097, which would expand payday lending offerings in the state, and we have communicated our opposition with the committee and members of leadership, as well as to DIFS Director Anita Fox and advisors to Governor Whitmer. The team is also fine-tuning the data breach packages in both the House and the Senate. More developments on those should come this summer and fall.
On the appropriations front, we continue to socialize our priorities for the 2021 budget. These priorities include funding for the Michigan Saves program and E-Recording upgrades across the state. The budget deficit continues to be more than $3 billion for the 2021 budget; our team knows that this is an uphill battle, but we’re working to at least put the framework in place to ensure that these projects are funded, if not this year than in 2022.
As you likely know, we had to cancel the MCUL GAC this year and did not get to distribute the PAC awards for last year’s performance. We deeply appreciate all of your commitment to our political action efforts and will be mailing the awards you’ve earned in the next few weeks. A complete list of winners can be found on our website.
On the Regulatory side, MCUL filed comments with the NCUA earlier this month on the agency’s Subordinated Debt proposal. In our comments, we thanked the agency for their efforts in crafting this proposal. We also took the opportunity to highlight our concerns with the various regulatory burdens imposed.
Elsewhere, the NCUA Board has approved a request to solicit feedback on alternative procedures to modernize the agency’s examination program, including aspects related to virtual examinations. The request also seeks input on any unnecessary hurdles or burdens credit unions face with respect to their ability to leverage various technological advances.
Comments will be due 60 days upon publication in the Federal Register. We’ll be issuing a request for comment to the industry and welcome your feedback as we intend to share our comments with the agency.
Moving over to Consumer Awareness, as I mentioned, our CU Link refresh is currently in media markets across the state. We’ve invested more than $900,000 in an all-digital media plan that will go through the end of the year. The first series of ads are airing now, with an additional series to come as we move closer into the fall.
These new ads offer hope and partnership to those struggling as they watch every household dollar. We emphasize the benefits of membership and offer a helping hand to those in need with credit union products and services. These ads highlight credit unions’ long-term commitment to supporting communities and members during crisis.
This refreshed style pairs with CUNA’s “Open Your Eyes” campaign to build brand equity. I encourage you to visit the MCUL website to view the ads and click on the integration portal. Our team has links to social media posts and customizable videos for inclusion in your marketing package.
Foundation funding for the first half of this year focused on supporting and amplifying credit union community outreach initiatives related to the COVID-19 pandemic, as well as helping the Mid-Michigan Chapter and the Midland area credit unions provide grants to help members recover from flood damage to their homes. This funding, and community impact, came about because of the generous cooperative involvement of many credit unions and businesses and I want to thank everyone involved in these efforts. Together, we have shown Michigan communities that, when a crisis hits, credit unions will be there to support them.
In addition to improving financial wellbeing associated with these two challenges, now is the time to look to the Foundation to help boost activities that focus on addressing the financial health challenges of underserved people, perhaps especially those that arise from racial discrimination and the disproportionate affect COVID-19 has had on people of color.
The Foundation is now accepting applications for Community Reinvestment Grants to help expand and continue community financial health initiatives, especially those assisting underbanked, low income and underserved areas. Please contact us to discuss your impact ideas and this grant opportunity.
We recently welcomed three new MCUF Trustees: Chrissy Siders from CP Federal Credit Union, Kyle Gurzynski from Safe Harbor Credit Union, and Dave Brandt from ELGA Credit Union. We’re excited for the leadership and commitment they bring with them to the board.
Switching over to Education, plans are in motion for Michigan credit union executives to participate with “Operation Reconnect,” six smaller in-person events located around the state with opportunities to come together with peers, leave with valuable information and participate in proper socially distanced activities.
Registration will be on a first-come basis for no more than 30 attendees for each location. This Michigan road trip to eight premier destinations will feature a different venue, timely topic, expert speaker and activity for each. Participants are not limited to attending just one, so be sure to visit MCUL.org for complete details about each of the destinations and the focus of the conversations taking place.
Summer and the second half of the year are officially here. CUSG continues to implement product enhancements that help credit union teams make the most of the second half of the year and find their footing in everything from new member experience journeys to altered sales cycles.
As summer travel plans change, more people are looking to purchase outdoor and adventure vehicles like RVs, ATVs, and watercraft. To help credit unions meet their members’ vehicle shopping needs, our Marketing Solutions division has added new Love My Credit Union Rewards portfolio offers from partners like CarAdvise and Rollick. These exclusive credit union discounts grow the valuable of membership and can also help to open conversations about vehicle loans. We’ve added these, and several other, new partners already in 2020, and have several big partner announcements on the way. Watch for more details in the coming weeks.
In big news from CUSG, as the Sprint member discount winds down this month, we will soon have an exciting new wireless partner to offer credit unions nationwide. We can’t announce it until the official end of the Sprint program on August 1st, but information on this great member opportunity will be coming in the Fall.
In June we launched a Marketing Insights Network webinar series to help credit union marketing professionals get back to business, understand the operations of the new normal and make the most of their budgets. The first webinar was a huge success with a record number of attendees. The next webinar in the series will dive deeper into the importance of member feedback, focusing on uncovering trends and taking action to improve experiences and metrics. Plans are in place to keep this marketing-focused, thought leadership project moving forward so long as it proves valuable to current and perspective credit union partners – we’d love to see you at one of the upcoming webinars and gather your feedback.
In early July, we announced a new strategic partnership with PenFed Credit Union – the second largest federal credit union in the US – and its marketing and advertising CUSO, WHITE64. Through this partnership, CUSG Marketing Solutions will offer WHITE64's award-winning marketing campaign, design, digital, media, strategy and studio services to our credit unions clients. Again, more details will follow soon.
In our Technology division, we’ve investigated and now invested in a video banking solution through VidyoCloud. This secure, cloud-based video service opens the “digital door” for credit unions to conduct on-screen banking interactions that also help to pare back the need for in-branch interactions. As we all recognize in the current climate, this type of service helps to make any organization more effective and efficient, but especially financial institutions. We have our eye on releasing this video collaboration solution by the end of summer.
From our Performance Solutions line, we’re in the process of finalizing multiple new add-ons to Compease, our compensation software. They include a raw salary data lookup capability, pay equity review with related recommendations, a historical look-back feature for managers who are making pay change decisions, and administrator access options at the department level for larger organizations. We’re always listening to what our credit union clients and partners need from performance platforms. If there’s a capability you’d like to see added to any of our core HR performance products, please reach out to us with comments or recommendations.
Finally, our Strategic Advisory team has continued to deliver essential, up-to-date best practices in the areas of strategic planning, leadership, risk management and compliance. Recently, division head Brandi Stankovic lead a strategic planning educational session with the Events Industry Council on strategies for career progression in this unique environment. Meanwhile, the team continues to share and expand the ability of compliance platform AffirmX, including a remote worker risk assessment feature.
That’s it for this month’s report. I’d like to take a moment to thank you all for the hard work you’ve done for your members over these last few months. Again, the numbers I mentioned earlier are indicative of this and speak very powerfully to our movement as a collective force for good. Please use this data as we continue to advocate for credit union-friendly policy throughout the second half of 2020.
Until next time, feel free to reach out to me if you have any questions or concerns regarding how we can help you best serve your members.
Thanks for watching.