FEBRUARY 21, 2014
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Tax Reform, GAC, and Opportunities to Connect with Congress (Issue 1 of 6)
There's still talk of tax reform in Washington, but the upcoming CUNA Governmental Affairs Conference and #DontTaxTuesday offer great opportunities to emphasize the "Don't Tax My Credit Union" message.

  Bill to Restructure CFPB (Issue 2 of 6)
A bill introduced in Congress earlier this month would, among other changes, replace the Consumer Financial Protection Bureau's director with a five-person panel and require CFPB to consider the effect of its rules on insured institutions.

  State Session: How’s It Work, and What’s a Bill’s Chance? (Issue 3 of 6)
Wondering how proposed legislation becomes law in Georgia? It's a long and winding road. Our primer explains the basics, and a new online tool tries to make educated guesses about bills' chances of eventual passage.

  Legislative Activity for the Week (Issue 4 of 6)
Legislative activity of interest to credit unions this week included passage by Senate committees of a bill asserting that overdraft fees are not subject to the state's usury laws, and one dealing with the issue of patent trolls.

  Great News: No TCCUSF Assessment in 2014, and Not Likely Going Forward (Issue 5 of 6)
NCUA announced that due to the significant recoveries from legal settlements, credit unions are much less likely to be charged another assessment by the Temporary Corporate Credit Union Stabilization Fund (TCCUSF).

  A Happy Member = GA CU Praised in Wake of Target Breach (Issue 6 of 6)
A personal call from his Georgia credit union's CEO following the Target data breach led an American Banker reporter to write a glowing account of what he called the "ultimate" in customer service.

Tax Reform, GAC, and Opportunities to Connect with Congress (Issue 1 of 6)

U.S. Capitol interiorHouse Ways and Means Committee Chairman Dave Camp (R-MI) plans to release his much-anticipated plan to overhaul the tax code soon, according to POLITICO, a Capitol Hill news publication. Although some are suggesting that tax reform may be less likely this year, most members of Congress still advocate for tax reform in general. Coupling that point with bank messaging to try to abolish the credit union tax exemption, credit unions must continue to educate both members and Congress on the not-for-profit credit union structure, and how credit unions help members afford life. With over 4,300 credit union advocates traveling to Washington, D.C., next week for the CUNA Governmental Affairs Conference (GAC), the timing could not be better! Next week at the GAC, there will be two Don’t Tax My CU grassroots activities unveiled that credit unions in Georgia can engage in (regardless of whether you are at the GAC):

  • #DontTaxTuesday – Tuesday, February 25th will be another #DontTaxTuesday. CUNA will email past Don’t Tax My Credit Union advocates to encourage them to contact legislators via the Tweet Congress tool at www.DontTaxMyCreditUnion.org. Engage your credit union, and if you are attending the GAC join in by tweeting using the #DontTaxMyCU hash tags.
  • “Email Don’t Tax Tuesday” – a "best practices" email template for credit unions to use in contacting and educating members on the tax issue will be shared at the GAC. This is in advance of a nationwide push for credit unions to send an email to members by Tuesday, March 11th, dubbed "Email Don’t Tax Tuesday." This campaign is to generate additional contacts to Congress, and to advance the awareness and understanding with members on this issue.
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Bill to Restructure CFPB (Issue 2 of 6)

CFPB logoA bill that would change the Consumer Financial Protection Bureau leadership structure and make some operational changes is a step in the right direction, per CUNA in a February 10th letter to Congress. The bill, the Consumer Financial Protection Safety and Soundness Improvement Act of 2013 (H.R. 3193), would help to assure that credit unions – and other entities – already subject to considerable regulation are not unnecessarily burdened. The bill was placed on the House schedule on February 4th, and a possible vote is anticipated soon. The bill would have a long road to enactment, but if passed would:

  • Restructure CFPB leadership from a single director to a five-member panel;
  • Authorize the Financial Stability Oversight Council to set aside any CFPB regulation that is found to be inconsistent with safe and sound operations of financial institutions;
  • Require the CFPB to take into consideration the impact of its rules on insured depository institutions;
  • Prohibit the CFPB from requesting, accessing, collecting, using, retaining or disclosing nonpublic personal information about a consumer, unless clearance has been granted; and
  • Make CFPB funding subject to the congressional appropriations process.
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State Session: How's It Work, and What's a Bill's Chance? (Issue 3 of 6)

Georgia Capitol interiorAs of press time the state Legislature is on day 26, leaving just 14 more "working" days until the end of the session (see the below article for this week’s activity). However, even in non "working" days, legislators will spend countless hours at the Capitol debating bills in hearings as they try to move issues forward in this fast-paced environment. But what does that process entail?

  1. Bills are introduced in either the House or the Senate, and then assigned to a committee where they have the chance, but not the guarantee, that they will be addressed in a hearing.
  2. If a bill is fortunate enough to have a hearing, then it is debated by those committee members (and could stay in the committee for the rest of the session, thereby "dying").
  3. If a bill is fortunate and receives not only a vote, but a positive vote, it then goes to the Rules Committee where it has the chance – but again, not the guarantee – that it will be selected for a full vote by the House or Senate. And note, this would need to happen before day 35 due to the rules of the state Legislature for the bill to have the chance to move forward.
  4. If a bill does move forward to the full House or Senate by day 35 with a positive vote, it then goes to the opposite chamber (i.e. a House bill would go to the Senate and vice versa).
  5. The process then starts all over again with the bills assigned to a committee, then to Rules Committee if fortunate, etc.
  6. Here’s where things get interesting: If there is a change (however minuscule) to a bill in the opposite chamber, if and when it passes it must return to its "home" chamber for a procedural move called "agree/disagree." Quite simply, this is where the full body of the House or Senate can agree with the changes the opposite chamber made, or disagree.
  7. If a bill is fortunate enough to make it to this point and is "agreed," it then travels to the Governor for his consideration.
  8. If the vote is to "disagree," then the bill is cast to a conference committee of just a handful of legislators from both chambers, where they and they alone get to choose what to put in a bill behind closed doors.
  9. And, there are many amendments/attempts to bills throughout the process. In the days leading up to the end, there are also attempts to insert entire bills into ones further in the process!

Once can see why it is imperative to continually work issues and monitor potential issues in bills throughout the process up to midnight on the last day! There is a wide variety of factors that weigh in on the likelihood of a bill’s navigating the entire process. However, The Atlanta Journal-Constitution recently released an interesting tool that attempts to assign an educated guess on the likelihood of passage. Please note it is subjective, but interesting to read whether one is curious about bills of credit union interest, or those of personal interest.

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Georgia Capitol interiorLegislative Activity for the Week (Issue 4 of 6)

With the 40th day of the state session scheduled for March 20th, time is of the essence for any bill to navigate the above process. As such, this week was filled with hearings on a wide variety of issues (there were three separate Banking Committee hearings alone this week in addition to all the other committees). While the press may focus on guns and Medicaid expansion, this week held much activity of interest to credit unions:

  • After two separate hearings, lobbying, and testimony the Senate Banking and Finance Committee on Thursday, February 20th passed a key bill for credit unions: HB 824, introduced by Rep. Richard Smith (R-Columbus). This bill seeks to bring consistency and clarity to overdraft programs at state-chartered credit unions and banks, asserting that overdraft fees are not subject to usury laws and are not considered interest. After reaching the Senate, this bill has picked up objection from trial lawyer interests and has been the focus of much effort on both sides. GCUA continues to educate legislators on the importance of this issue to support the bill, working with a coalition of interests to ward off negative amendment attempts. The AJC tool presently shows the chance of passing at 53%.
  • On Tuesday, February 18th another bill helpful to credit unions (and businesses in general) passed the Senate Banking and Finance Committee: HB 809 by Rep. Bruce Williamson (R-Monroe). This legislation seeks to curb the growing threat of patent trolls, and protect against frivolous lawsuits. GCUA has been working with Rep. Williamson to ensure that the amendments sought in the Senate did not negatively impact the intent of the bill, which is to ward off patent trolls! The AJC tool presently shows the chance of passing at 42%.
  • On Monday, February 17th a House Judiciary Sub Committee addressed but did not vote on HB 917 by Rep. Brian Strickland (R-McDonough), which seeks to regulate deficiency judgments (where a guarantor of a loan that is not performing is sued by the lender or purchaser of the debt obligation). From a credit union perspective, the concern is that this bill could lead to a judicial foreclosure process via amendments, something Rep. Strickland has shared that he is not seeking. Another hearing has not been scheduled yet as of press time, but the issue is being monitored. AJC: 36% chance.
  • On Tuesday, February 17th the House Banks and Banking Committee heard testimony on a foreclosure bill, HB 903 by Rep. LaDawn Jones (D-Atlanta). This bill would (among other things) allow the debtors to inhabit homes past the point of foreclosure and/or foreclosure sale, allowing them to remain until the deed is recorded. The legislation also would require the foreclosing party to be responsible for all fees and fines associated with the property. GCUA was one of several parties to testify against the legislation. No votes were taken, but this bill could arise again in an upcoming hearing next week. AJC: 13% chance.
  • The Senate Banking Committee also heard testimony in two separate hearings this week on the contractor lien bill SB 363 by Sen. Lindsey Tippens (R-Marietta), however this bill has changed multiple times in the process, and seeks to provide subcontractors an avenue to request the schedule of funding from the financial institution. This bill passed the Committee and continues to be monitored for additional changes. AJC: 33% chance.
  • The Department of Banking and Finance’s Housekeeping bill, HB 982 by Rep. Bruce Williamson (R-Monroe), had a hearing in the House Banks and Banking Committee on Tuesday, February 18th. It seeks to change regulations on check cashers (but no changes for credit unions), and a vote is anticipated in another hearing, possibly next week. AJC: 19% chance.
  • The House Banks and Banking Committee also heard testimony on HB 883 by Rep. Brian Strickland (R-McDonough), which would make technical changes to the Merchant Acquirer Limited Special Purpose Bank section of the code. A committee vote is also anticipated possibly next week. AJC: 39% chance.
  • A House Judiciary Non-Civil Subcommittee addressed a bill that seeks to help prevent “squatters” from moving into foreclosed homes. HB 985 by Rep. Tom Kirby (R-Loganville) was debated, and is anticipated to be addressed in a future subcommittee. In discussions with GCUA, he is seeking to prevent the filing of false liens or any instrument relating to real property/title that clouds law enforcement’s ability to evict trespassers and protect the real property owner’s interest. AJC: 41% chance.
  • The House Industry and Labor Committee passed a bill that seeks to provide businesses the option to pay employees with prepaid debit cards. HB 947 by Rep. Josh Clark (R-Buford) has been monitored to ensure that A) it is not a mandate and employees can choose another method, and B) it does not morph into a bill that seeks to alter card procedures (and even interchange) due to the subject matter. AJC: 36% chance.

There were many more bills and issues debated in committees during this hectic week, and more as of press time (AJC percentages on bills were as of February 19th). These hearings do not include the multiple bills introduced every day! Stay tuned for more information on bills of interest as the session winds through the rest of their schedule.

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Great newsGreat News: No TCCUSF Assessment in 2014,
and Not Likely Going Forward
(Issue 5 of 6)

On February 12th, NCUA announced that due to the significant recoveries from legal settlements, credit unions are much less likely to be charged another assessment by the Temporary Corporate Credit Union Stabilization Fund (TCCUSF). And looking at bottom lines for 2014, there will be no TCCUSF assessment charged in 2014! This positive news comes on the heels of a $1.4 billion settlement with JP Morgan and the continued improvement in the performance of the legacy assets underlying the NCUA Guaranteed Notes program. Credit unions have paid $4.8 billion in TCCUSF assessments since the fund was established. The projected net remaining assessments over the life of the TCCUSF, based on estimates from the second quarter of 2013, now range from -$1.9 billion to -$0.4 billion. CUNA Chief Economist Bill Hampel said that looking forward, future TCCUSF rebates are now likely.​

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HappyA Happy Member = GA CU Praised
in Wake of Target Breach
(Issue 6 of 6)

Know the parable on being kind to strangers? While it’s not a stranger – it’s a member – one rarely can see how far the ripples of positive interaction reach. But here’s an instance where those ripples were seen all across the country. BOND Community FCU’s member service was highlighted in a first-person account in the February 18th American Banker by reporter Andy Peters, who detailed his experience. CEO Ruth Artis called him directly to inform him that his debit card had been compromised in the Target data breach, and a replacement card would arrive in a couple of weeks. Peters compared the service to the automated voice mail left behind by Bank of America's card services subsidiary, after which Peters tried to follow up with the customer service line. The agent would only share that the card had been affected by fraud at an "undisclosed retailer" and did not give a time frame of when the fraud occurred. The article continued that poor communication about fraud hurts a financial institution's business, and that Artis’ personal phone calls to the credit union’s members were the "ultimate" in customer service.

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