Each house in Congress is currently engaged in comprehensive tax reform activities. According to CUNA, leaders in both the House and Senate have committed to forwarding some type of comprehensive tax reform initiatives this year and they have shared the message that everything is on the table. This includes credit unions' tax status.
We do not need to assume a defensive posture as if the decision to remove credit unions' federal tax exemption (technically called ‘tax expenditure’ at the federal level) has already been made. However, credit union Activists need to work as if this status is in question, because like all ‘expenditures’, loopholes and other tax devices, it is.
The critical first step in this important fight is for credit unions to increase member-awareness activities and prepare for a variety of advocacy initiatives focused on preserving our tax status. In the coming days and weeks, The League will be providing resources for credit unions and Activists to utilize. These resources will mirror or highlight the value and social responsibility of credit unions as showcased in the Scorecard.
In addition, CUNA D.C. staff will be visiting Credit Union House this Thursday from 10:30 to Noon to discuss Payroll Deduction and provide additional background and updates the tax situation. Activists should consider attending this brief but important meeting.
The Wisconsin Bankers Association is at it again. League staff has discovered WBA’s most recent covert effort to meddle directly in the affairs of credit unions as part of their Operation Credit Union. Operation Credit Union is the nationwide effort of the American Bankers Association and their state affiliates to, “contain and convert credit unions.”
WBA is asking lawmakers to remove the independent features of the Office of Credit Unions by making OCU a division of the Department of Financial Institutions. WBA has been quietly working to convince legislators on the Joint Committee on Finance to approve a budget motion that would become part of the current state budget bill. Once a part of the budget bill, it is nearly impossible to have a single provision removed.
League staff, our contract lobbyists and the Cooperative Network are currently circulating a memo to Joint Finance members and others, explaining:
The OCU is not a GPR/taxpayer supported agency and there are no proven operational or budgetary efficiencies that the realignment of these agencies would provide. Any efficiencies were fully realized after the Legislature passed 1995 Assembly Bill 150. AB 150 attached the OCU to the DFI for administrative purposes as part of Governor Thompson and the Legislature’s massive effort to create, abolish or alter dozens of state agencies, boards, councils and commissions.
Please know that credit unions carefully scrutinize the OCU budget and work collaboratively with OCU, DFI and other agencies to ensure all revenues are spent prudently because the OCU is a Program Revenue funded agency. The revenue it operates on comes directly from credit unions. If meaningful savings could be proven to be realized from changes to the internal structure of the agencies, credit unions themselves would be proposing changes.
To be very clear, any proposals to change the OCU and DFI alignment and/or internal structure have not originated with and are not supported by credit unions. The Governor, the OCU, DFI and DOA also did not request or recommend changing the agency’s alignment in the current budget bill.
We will continue to actively oppose the WBA efforts and may call on Activists to contact their elected officials in the coming days.
Four of Wisconsin's Congressmen have announced they will hold in-district listening sessions in the coming days. Given the importance of our current tax status, Activists in these Congressional districts may wish to attend one of the sessions:
Congressman Paul Ryan (R-Janesville)
Congressman Mark Pocan (D-Madison)
Congressman Ron Kind (D-La Crosse)
Congressman Jim Sensenbrenner (R-Menomonee Falls)
If you plan to attend any of these meetings or office hours, please contact Sarah Wainscott at (608) 514-0086.