May 2020
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Welcome to the May 2020 Priority Report. As you know, we will spend the rest of May under the Stay Home, Stay Safe order. I want to begin by expressing how inspiring it is to see the many credit union stories on how your essential workers are supporting members and making an impact during this unprecedented time. As you have in the past, credit unions truly shine in times of crisis to meet the individual and small business needs of the communities you serve.
Your efforts were recognized earlier this month by both Governor Gretchen Whitmer and DIFS Director Anita Fox, both of whom joined our movement in a virtual meeting with more than 400 credit union professionals and volunteers to discuss the impact of the COVID-19 health and financial crisis on Michigan’s residents and business community.
We communicated that our primary focus is on providing for consumers hardest hit by the pandemic, and asked Whitmer and Fox, as they create legislative and regulatory measures, that they have a similar focus and help credit unions best serve those struggling members. Among the specific issues addressed, we mentioned the need for funding to support mortgage foreclosure and forbearance relief and guidance to help PPP borrowers successfully make sure their loans are forgivable.
Gov. Whitmer thanked the League for inviting her and remarked that Michigan credit unions have truly shown themselves to be an essential part of helping consumers through this crisis. Fox echoed Whitmer, recognizing that Michigan credit unions have been finding various ways to step up to uniquely reach those currently in need. Both leaders also expressed interest in working with MCUL in the near future to engage lawmakers and provide the best legislation for credit unions and their members.
Before getting into department details, I want to take a moment and raise awareness for MCUL’s Covid-Response data tracking initiative. We’re currently asking credit unions to visit the data portal on MCUL.org to input their various support totals.
Through seven weeks of tracking, the data has been very helpful in allowing the League to communicate the difference Michigan credit unions are making. So far, our movement has helped very small businesses access an estimated 10,000 Paycheck Protection Program loans – 10% of which are for new credit union members who found the help they need when turning to their local credit union.
Our movement has also been doing outstanding work assisting members with mortgage relief. More than 140 credit unions and support organizations signed on to the Governor’s MiMortgage Relief Partnership and virtually all Michigan credit unions have been voluntarily assisting financially impacted homeowners by delaying foreclosures and offering payment delay arrangements. An estimated 6,000 homeowners owing $400 million in mortgage loans have received assistance with their mortgage payment delays, and due to financial hardship related to temporary income loss.
This is just a snapshot of the information we have been able to highlight in recent communications thanks to credit unions taking a few moments to enter support efforts in our data portal. These types of numbers are very powerful for potential 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. We will be producing quarterly reports from this data to continually provide an updated view of the industry here in Michigan. Due to the rapidly changing data, this will be a quarterly synopsis of information based on our increasing sample size. So, please continue entering your support data in our website.
FEDERAL ADVOCACY AGENDA
Now, as I jump into the League’s Advocacy agenda, I’ll start by going into more detail on PPP loans. Building on the Phase 3 emergency stimulus bill, which established the SBA’s loan program, and provided an initial $349B in program funds, Congress passed a Phase 3.5 version of the bill on April 24. This bill provided an additional $310 billion for PPP of which $30B was specifically allocated to financial institutions under $10B in assets, while an additional $30B was allocated to those between $10-50B in assets. Among other things, the bill also included an additional $10B in funding for the Economic Injury Disaster Loan (EIDL) Program, permitting farmers and ranchers to receive EIDL assistance.
The U.S. House has introduced legislation for a Phase 4 bill, referred to as the HEROES Act. The bill includes hundreds of billions of dollars in funding for local and state governments in the bill, while also seeking to address other priorities, such as: unemployment insurance, financial assistance to individuals on COBRA to cover program premiums and a fund toward the increase of wages/salaries of front-line employees during the pandemic. All told, the HEROES Act from the House may approach $3 trillion in total funding, which exceeds the initial $2 trillion-dollar CARES Act that was signed into law in late March.
MCUL has concerns with some of the restrictions that are included in the new legislation and are working with CUNA and directly with lawmakers to create credit union-friendly legislation, going forward.
For instance, as drafted, the provisions of the HEROES Act related to mortgage forbearance and moratorium make very little effort, according to the League, to target the proposed relief to those who need it – specifically those borrowers who can demonstrate a financial hardship due to COVID-19-related illness or job loss. If these provisions are not altered or removed there should be a strong connection between the availability of relief and demonstrated COVID-19-related need.
Looking ahead, the League is advocating for continued relief for state, local and tribal governments. Likewise, providing $75 billion in funding for the proposed Homeowners Assistance Fund answers MCUL’s call that we look ahead to future challenges that borrowers and financial institutions will be navigating post-crisis.
It’s unclear how quickly the Senate will act on such a bill, but we will keep you apprised of developments around the HEROES Act and any additional COVID-19-related legislation.
STATE ADVOCACY AGENDA
On the state side, the Governor and the state legislature continues to also be in the thick of COVID-19 response measures, as well as the fiscal year 2021 budget. Executive orders are being issued by the Governor weekly to help provide continued guidance.
Earlier this month, the Governor also revealed her MI Safe Start plan to re-engage Michigan’s economy. Currently, most of the state is in Phase 3, the “Flattening Phase,” which simply states we are still safer at home than in gatherings and need to continue face coverings in public. Phase 3 also states where certain sectors of the economy can begin to re-engage safely. These sectors include construction, manufacturing, real estate and outdoor work. However, the Governor just recently announced the Upper Peninsula and parts of the northern Lower Peninsula will move into Phase 4 allowing retail businesses, including bars and restaurants, to open at 50% capacity.
Be sure to visit mcul.org for more detailed information on how these and other executive orders directly affect credit unions.
Finally, with the legislature resuming a regular session schedule, our team is working to socialize important issues and appropriations asks. We’re hoping to get small changes to data breach made before working to get this legislation passed by both chambers. Furthermore, our team is looking to push elder abuse, powers of attorney (POAs) and fixing issues we have encountered with electronic notarization. On the appropriations side, our focus is on securing funding for electronic notary implementation and upgrades for counties across the state, as well as funding for the Michigan Saves program.
REGULATORY COMPLIANCE
On the Regulatory side, we continue to work very closely with DIFS and NCUA. Earlier this month, the team met with DIFS Office of Credit Unions Director Denice Schultheiss and Assistant Director Leanne O’Brien to discuss examination survey results from 2019 and recent concerns in light of COVID-19. They were receptive to our concerns, including remote examinations and credit union responses to the COVID-19 pandemic. The agency leaders said DIFS will take a risk-based approach to each credit union.
We also discussed the potential of another survey and meeting after the pandemic to evaluate how the examination process has differed during and after the crisis. We will be working to schedule similar discussions with the NCUA.
The NCUA continues to issue interim final rules to assist credit unions through the pandemic, including increasing the exemption for real estate appraisals from $250,000 to $400,000. NCUA also continues to issue guidance to the industry on working with members through the pandemic and after. All of this information and more can be found on MCUL’s COVID-19 resource page.
Finally, we continue to collaborate with Strategic Advisory Services and League InfoSight to bring to you all available compliance resources.
CONSUMER AWARENESS
Switching gears to Consumer Awareness, since CU Link’s pivot from the Open Your Eyes campaign to the Michigan Safety and Service campaign, the CU Link website has experienced an expected surge in visitors over the past two months of the new campaign. This demonstrates our commitment to offer a helping hand when Governor Whitmer announced a stay-a-home order and consumers were most in need. We’ve specifically seen a lot of traction with the small business specific credit union finder tool and consumer-focused pages.
This past month, consumer-focused pages were updated to assist homeowners with mortgage questions around forbearance, loan backing and the MiMortgage Relief Partnership. For those credit unions needing talking points for consumers, the CU Link site serves as a helpful resource. This surge of visits is a combination of increased marketing spend and the need for help in our state.
MCUL will be using the data-gathering project I mentioned earlier to craft messaging for phase 2 of the campaign, focusing on all the great things credit unions have done and continue to do as we work together throughout this current crisis.
The current phase of this campaign will be in markets across the state through June. MCUL has invested nearly $600,000 in a second-quarter media buy. This amount of investment between March and June is structured to promote large-scale awareness with reassurance and drive consumers to credit unions, branches and the geo-finder via the CU Link website.
The Michigan Credit Union Foundation is promoting the credit union difference through Community Crisis Support grants, which are helping boost potential and ongoing credit union initiatives, such as Michigan Schools & Government Credit Union’s recent effort to provide safety equipment for frontline workers. $100,000 has been allocated for projects like this across the state.
Meanwhile, MCUF financial education programs are adapting to remote learning experiences for students with online access. The High School Personal Finance Challenge was held completely online this year with Chelsea High School coming out as the state champs after an exciting personal finance quiz bowl streamed live on Facebook by the Michigan Council on Economic Education. 29 schools across Michigan participated in the program this year.
I invite you to continue to leverage our Foundation’s programs and grants to assist with your social mission and financial health activities. For more information and contact links, please visit the foundation webpage at mcuf.mcul.org.
EDUCATION
I couldn't be any prouder of how our Education Team has stepped up to support Michigan credit unions during the pandemic. Our quick pivot to online training and convenient recordings reached more than 1,300 credit union staffers and volunteers in just six weeks, serving 80% of our member credit unions with valuable information, as well as Michigan CUSOs.
We have been able to deliver half of these sessions at no charge, as well as using our resources to bring credit unions together for face-to-face online calls to exchange best practices and ideas.
We're certainly not done yet. So, visit MCUL.org and continue to take advantage of the value-added training we're offering specifically to meet your needs.
Annual Conference & Exposition
As we look ahead and hope to find some normalcy, we know many of you are excited about the 2020 Annual Convention & Exposition. Our team has been in contact with League Education directors from other states who have been dealing with similar event postponements and we feel great knowing that, here in Michigan, we will continue to move forward by thinking outside the box during these challenging times.
Each AC&E is an event five years in the making, so while we reset planning to a new timeline, we appreciate your support and assure you we will be keeping everyone updated. Meanwhile, save the dates for Sept. 18-20 in Traverse City.
CU SOLUTIONS GROUP
Now, let’s switch gears to the CU Solutions Group side. As organizations and consumers continue to adjust to the new pace and distance of business, CUSG has created free, time-relevant content and resources for credit unions. We’re also working to ensure current clients understand how to take full advantage of our products and services that already enhance remote work and business practices.
CUBE TV Studios has produced a series of credit union–focused videos that reinforce credit unions’ not-for-profit, people-first service mantra. They note the availability of emergency loans, loan restructuring and deferred payments, in addition to reassuring members that their savings are safe, secure and federally insured by the NCUA. We’ve made these videos free to use by credit unions nationwide – they can also be customized for a nominal fee of $249. All video can be accessed at VidFuel.com.
In addition to these videos, we’re offering turnkey marketing campaigns to help credit unions increase share of wallet. These campaigns are easy to customize and deploy while credit union teams work from home.
For current MemberXP clients, a special feedback survey within the MemberView analytics platform has been created. This special survey can be leveraged immediately in COVID-19 email and website communications to collect and capture insights on how your credit union messaging, employees and crisis management processes are meeting the needs of members.
Our Love My Credit Union Rewards team is currently helping credit unions update their TurboTax marketing assets and communications to account for the extended tax deadline. We’ve developed extended marketing plans for credit unions to increase member engagement and inform members on how the CARES Act impacts filing. We’ve also added new discounted service offerings, like on Sam’s Club memberships, subscriptions to Rental Kharma and on home electronics insurance from Asurion.
In the area of technology, it’s no surprise the focus for credit unions and service providers has been enabling, expanding and improving remote work and service delivery capabilities. Members are actively searching for and requesting access to the same services online they used to receive in branch. And while CUSG already offered tech solutions for digital and remote services, we’ve shortened timelines for implementation and enabled features for free. Our CMS clients now have access to all modules in our library, at no extra cost – and Bold Chat customers can add additional seats, at no charge, in order to help serve more members remotely.
For those looking to add communication and service delivery capabilities, you can enhance and expand communication via Pure Chat, our website chat feature. This solution can be implemented in one day and provides 10 licenses and the ability to have a group chat with two staff members at the same time. Additionally, new partner SilverCloud provides credit unions access to automated remote technologies such as automated member support, turnkey chat bots and enhanced employee support.
Now, more than ever, HR teams are faced with the challenge of keeping employees on the same page. Our Planning Pro software supports collaboration within a virtual team and is available for a quick implementation and free trial period. The software allows teams to collaborate on daily tasks that are tied to goals and strategic objectives. And reports can be quickly generated to bring management, executives and the board up to speed on strategic and operational plan progress.
Finally, crisis-related educational content from our Performance Solutions and Strategic Advisory Solutions teams have been made available to credit unions at no cost. Currently, more than a dozen courses cover a range of topics, including: Establishing Effective Virtual Teams, Becoming a Successful Collaborator, Managing During Crisis, Assessing and Responding to Risk, Governance and Financial Impact, Lending in Hard Times, and Top Questions Credit Unions are Asking – among several others.
This is just a portion of the resources CUSG has made available to credit unions and CUSOs. These and many more are available immediately through a special COVID-19 resource portal, front and center on CUSG’s homepage.
That’s it for this month’s report. As a last reminder, I encourage you to visit our Covid-Response Data Portal and enter data that will help us tell your story.
I hope all of you are remaining safe and sound. 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.