League, CUs Engage With Lawmakers During Busy Week on Capitol Hill
Your League and member credit unions met this week (in-person, via virtual meeting or both) with Rep. Rob Wittman (R-1st), Rep. Elaine Luria (D-2nd), and Sens. Mark Warner and Tim Kaine to discuss interchange and other federal-level legislative priorities. During the past eight weeks, we've met with every member of our Congressional delegation -- in some cases, multiple times -- to lobby for our issues.
The intensity of lobbying this week on the interchange bill (S. 4675) reached a fever pitch with 1,688 companies and 231 trade associations sending letters to every member of Congress pushing for passage of the legislation designed to change the card network system, a move credit unions vehemently oppose. NAFCU and several Leagues were out in force on Capitol Hill this week to lobby in opposition to S. 4675. League President/CEO Carrie Hunt participated in NAFCU’s Congressional Caucus, joining our member credit unions in meetings with Virginia lawmakers as part of NAFCU’s efforts on Capitol Hill.
Merchants and their trade groups are asking lawmakers to expand interchange price caps to credit cards. But it’s interchange fees that allow financial institutions to cover some costs associated with offering low-cost lines of credit, state-of-the-art fraud protection, and to help cover fraud losses. Changes to interchange fees on credit cards would lead to credit union members and other consumers losing out on security, card benefits and savings.
- Your League is also fighting any regulatory change to the current overdraft program model (Overdraft Protection Act of 2021 – H.R. 4277). Our communication to lawmakers note that overdraft programs are already heavily regulated, which includes a required opt-in feature. We worry that any new regulation or government intervention related to overdraft programs runs the risk of restricting consumer access to this important service, which might well drive those in need to less-regulated entities, such as payday lenders. In addition, credit union members view the option of overdraft protection as a benefit of their credit union membership.
- We also oppose legislation that would give the National Credit Union Administration wide authority to examine third-party vendors, a bill co-sponsored by Sen. Mark Warner. We are particularly concerned about the potential costs to credit unions that could result should the Improving Cybersecurity of Credit Unions Act of 2022 (S. 4698) become law. We continue to voice our concerns related to the bill to Sen. Warner and his staff.
- We support Board Modernization Legislation (Credit Union Board Modernization Act – H.R. 6889 and S. 4325) which would revise the frequency of meetings required to be held by a federally chartered credit union's board of directors. Specifically, the bill requires monthly meetings for new credit unions during their first five years of operation and for credit unions with a low soundness rating.
All other federally chartered credit unions must hold at least six meetings annually, with at least one meeting held during each fiscal quarter. Currently, all federally chartered credit union boards must meet at least once a month. We view this measure as an opportunity to modernize an outdated board meeting requirement, while reducing the regulatory burden on eligible credit unions, especially our small credit unions and those located in rural areas. Owing to the advocacy efforts of credit unions and the League, Rep. Morgan Griffith (R-9th) and Sen. Tim Kaine have signed on as co-sponsors of these bills!
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