WASHINGTON–Credit union representatives hit Capitol Hill en masse beginning Wednesday as part of America’s Credit Unions Hike the Hill effort. The thousands of credit union professionals and volunteers were in town for the trade group’s Governmental Affairs Conference.

In any other year credit unions would have been meeting with their respective representatives over specific pieces of legislation, such as Sen. Durbin’s proposed credit card interchange bill. And it was certainly discussed by some credit unions in their meetings, especially with representatives of the nation’s restaurants—who support the interchange legislation—scheduled to be in Washington next week.

But a much higher-than-usual level of concern over the fate of the credit union tax exemption under the current Congress and the Trump administration has led to heightened attention to that issue. Indeed, America’s Credit Unions launched a major “Don’t Tax My Credit Union” initiative in conjunction with GAC, with TruStage announcing a $250,000 donation to fund the effort to ensure a tax-status change isn’t included in any legislation as Congress looks to fund its plans for extending the Trump tax cuts.

There has been considerable discussion around whether the House will include removal of the tax exemption in a spending/tax cut package being considered in the House.

If there is a silver lining for credit unions it is that the Republican majority in Congress is razor thin, and CUs have shown great power in turning on political pressure.

Senator, Administration Official Appear

Ahead of the Hill hikes, Senate Banking Committee Chairman Tim Scott (R-SC), SBA Administrator Kelly Loeffler, and Sen. Ron Wyden (D-OR) appeared on stage on the closing day of GAC. 

Scott had previously served on the board of Heritage Trust FCU, now REV FCU, in South Carolina.

‘Without Question’

“I will say without any question that’s the foundation of the way I view the financial lens,” said Scott. “It was such a powerful experience to understand that there are financial institutions created with one objective: making sure that the person feels seen. In the world that we live in today one of the most important things that we can do is make sure that the folks that are walking into the credit unions never lose their sense of relationship. It is the cornerstone of the credit union experience and one of the reasons why I’m a raving fan of credit unions, because you guys have done such a good job of maintaining this sense of intimacy that is missing in so many financial institutions.

“If we are to serve our communities we need places to go where people feel like they’re not a number but they’re actually a person,” Scott added.

The full video of Scott’s remarks can be found here.

Statement from SBA Director

The SBA’s Loeffler told the meeting, “This administration wants to expand that reach, ensuring capital gets into the hands of more people working with their trusted partner, and that’s you. Last year credit unions loaned nearly $830 million under our core 7(a) loan programs.

“In collaboration with other agencies, small businesses, and partners like you, I know we’re going to revive the American dream on Main Street,” Loeffler added..

Narrow Majority

Meanwhile, one senator pledged support for the CU tax exemption, which has been in place since the Federal Credit Union Act was passed in 1934. 

“I want to make it clear that when the dust settles this year on the tax issue and reconciliation, a top priority of mine is protecting the tax exemption for credit unions because of the difference it makes in our communities,” said Oregon Sen. Wyden. “There will be debates in the Senate and the House, and there will be votes, but at the end of the day leadership on both sides is going to have little room, with literally only a couple of people in there.”
Wyden told attendees that the visits with legislators this week “are some of the most important visits you can possibly make.”