Credit unions are continuing their efforts for another piece of legislation despite a recent setback. U.S. House of Representative leadership pulled H.R. 5519, the Credit Union Regulatory Relief Act (CURRA), on April 28, 2008, following an attack by the banking lobby.

CURRA was originally introduced on the House suspension calendar, which is reserved for non-controversial bills. House leaders had planned to pair CURRA with a regulatory relief bill for banks. CURRA’s status of “non-controversial” changed when the bankers disregarded their agreement with House leadership and decided to oppose CURRA.

The banking industry generally opposes legislation that eases burdens and restrictions on credit unions. Credit unions remain the most highly regulated and restricted of all insured financial institutions.

Regulatory relief for credit unions would help improve productivity and efficiency in a competitive and dynamic marketplace, and will translate into better and lower-cost service to credit union members. CURRA features three significant provisions that would allow all federal credit unions to apply to serve underserved areas, exempt member business loans made in underserved areas, and permit federal credit unions to offer payday loans to non-members within their field of membership.

The Credit Union National Association is now working to get CURRA placed on the regular voting schedule.

The 2007 version of HR 1537: Credit Union Regulatory Improvements Act (CURIA) seeks to modernize credit union net worth standards, reduce regulatory burdens and advance efforts to promote economic growth. U.S. Reps. Paul Kanjorski (D-Pennsylvania) and Ed Royce (R-California) introduced H.R. 1537 on March 15. While similar to the 2006 version, the new CURIA has additional provisions that address field-of-membership rules and establish additional consumer safeguards in the event of a credit union conversion.

HR 1537 also includes provisions to:

• Incorporate the National Credit Union Administration’s PCA reform/risk-based capital proposal to modernize net worth standards.
• Clarify the 1998 Credit Union Membership Access Act to allow all credit unions, regardless of charter type, to serve those in underserved areas.
• Increase the cap on loans to members for business purposes (MBLs) from 12.25 percent to 20 percent of assets. It would also exempt loans under $100,000 and those to nonprofit religious organizations from the MBL calculation.

CURIA was referred to the House Financial Services Committee on March 15. For a one-page summary, go to www.mcua.org/files/smcustaft/22/file/Political_Action/2007-CURIA-Summary.pdf.

CURIA currently has 119 co-sponsors in Congress, including Missouri Congressman Russ Carnahan (D-District 3).