Mary Martha Fortney

Since the November 2005 House Ways and Means Committee hearing, the credit union system has been working to address the issues raised on documenting credit union service to members. At the February 2006 Credit Union National Association (CUNA) Governmental Affairs Conference (GAC) in Washington D.C., this topic was a main discussion point in meetings NASCUS held with other credit union groups, National Credit Union Administration (NCUA) Board members and in our board and committee meetings.

During the past several months, NASCUS has been in dialogue with the NCUA, the GAO and other involved groups to address issues related to documenting service to credit union members. Government Accountability Office (GAO) staff first met with NASCUS at our offices on January 13. The GAO has been asked by the House Ways and Means Committee, to further study credit unions and their tax exempt status, services and field of membership. They are also comparing credit unions with other depository institutions. This new study is a follow-up to a 2003 GAO study on credit unions.

NASCUS gathered information from state regulators and the Advisory Council Board to help answer the GAO’s questions. NASCUS communicated to GAO about the complexity of the state system and the difficulties in comparing different states and charters.

Also in January, NCUA Executive Director Len Skiles and Deputy Executive Director Jane Walters briefed the NASCUS Board about plans to gather information from a statistical sample of 481 federal credit unions for a data collection pilot. NCUA is collecting data on four aspects: the extent and type of services provided to members; the income distribution of members; the reliability and value of this preliminary data; and executive compensation and benefits. This data collection pilot was slated to begin in February. But, it has been delayed by the federal Office of Budget and Management, which has yet to approve the project as of this writing.

We continue to be a resource to NCUA as the program proceeds for federal credit unions. We have had several meetings with the NCUA and facilitated discussion with Massachusetts and Connecticut regulators, who have experience in collecting data through their state-CRA requirements. NASCUS will continue discussion with NCUA on this topic.

On February 24, GAO staff including Rick Hillman, Managing Director, Financial Markets and Community Investment and Yvonne Jones, director of the study team, met with NASCUS again. This time, the GAO met with NASCUS Board members, who provided the GAO with the state regulatory system’s perspective.

As the NASCUS Board discussed the dual chartering system during the February GAO meeting, it became evident that the GAO staff began to better understand why information gathering, if it were to happen, could be different for the states. It was noted, though, that the GAO and Congress prefer to encompass both state and federal credit union information. The NASCUS Board emphasized the need to further educate the GAO and the Congress about the differences between the charters and the role of state regulators. This insight will be key to understanding and analyzing any state data collected.

Following the GAO meeting, the NASCUS and Credit Union Advisory Council Boards discussed these issues at length. Discussion will certainly continue both within this organization and in the credit union industry. I will keep you informed of any new developments. I encourage you to contact me with any questions or concerns at marymartha@nascus.org.

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