NWCUA Bill Passes to Advance Washington Credit Union Act as Legislature Heads into Final Weeks of Session
April 16, 2013
April 16, 2013
Late last week, Senate Bill 5302 passed the House floor by a vote of 94-0 with 4 excused. The bill will now be delivered to Governor Inslee to be signed into law. Once delivered, the governor has five days, excluding Sundays to take action on the bill provided adjournment does not occur within those five days. If the Governor doesn’t sign the bill, it automatically becomes law, and takes effect July 28, 2013.
The bill is comprised of recommendations made by the Northwest Credit Union Association (NWCUA) Washington State Model Act Subcommittee. The subcommittee provided recommendations for improvements to the act designed to advance the charter and operating environment for Washington credit unions.
SB 5302 will make the following changes to the Washington Credit Union Act:
- Create more flexibility for credit unions investing in real property by allowing up to six years for use of unimproved property, or three years for improved.
- Allow credit unions to invest in mutual funds made up of securities already otherwise permitted for credit union investment.
- Clarify that a credit union need not divest itself of an investment if permissible when made, and the nature of the investment changes making it impermissible.
- Remove the requirement that a credit union board of directors meet on a monthly basis and allow for a minimum of six meetings per year, one at least quarterly.
- Give credit unions greater flexibility in the timing requirements of calling a special membership meeting; extending the notice from no longer than 30 days, to no longer than 90 days.
- Remove the prohibition on board and committee compensation and give the state regulator authority to conduct rulemaking concerning reasonable director compensation.
- Change the merger vote requirement to a simple majority vote from the current two-thirds majority requirement.
Other legislative developments the NWCUA is tracking include the state budget. Following actions already taken by Governor Inslee and the state Senate, the House released its budget plan last week. It proposes a $34.5 billion spending level which is $3.3 billion more than the current expenditures, $75 million higher than the Governor’s proposed budget and $1.2 billion more than the Senate budget.
The House proposal increases taxes by $1.34 billion, increases funding for K-12 education by more than $1.25 billion, increases spending for higher education by $300 million, and includes funding for state employee salary hikes at a cost of $209 million.
The Senate Financial Institutions, Housing & Insurance Committee as well as the House Business & Financial Services Committee have ended their hearings for the year.
The cutoff for bills to pass out of the opposite house is Wednesday. All remaining bills need to have passed out by that time or are considered dead. The Legislature will slow considerably after Wednesday, with budget negotiators expected to hold closed-door meetings to negotiate a compromise between the Senate and House positions.
Reconciling the two budgets is now the final business as the legislative session heads toward the April 28 end of the 105-day session.
The biggest difference between the Senate and House budgets is where the money comes from. The House goes after 15 tax breaks worth half a billion dollars that House Finance Committee Chair Rep. Reuven Carlyle (D-36) said couldn’t justify a return on investment for taxpayers if they tried.
The House budget proposes closing or narrowing tax breaks including:
- Repeal of a tax break on bottled water ($51.5 million)
- Repeal of a preferential rate for stevedoring ($27.7 million)
- Repeal of an oil industry tax break ($40.8 million)
- Repeal of a high-tech sales and use tax deferral ($55.5 million)
- Making permanent a temporary beer tax and a temporary B&O surcharges on professional services ($700 million)
- Suspending of voter-approved I-732 (a cost of living increase for teachers), worth $324 million
- Repeal of the non-resident sales tax exemption
Other exemptions for landline phone service and the estates of married couples are targeted, partly in response to court rulings. Those changes raise $270 million.
The House and Senate will have to work out their budget differences before the end of the regular session if they want to avoid going into special session. Democrats have a 55-43 majority in the House. The Senate is controlled by a coalition of 23 Republicans and two Democrats.
Seven Democrats voted on the Senate budget which passed the Senate on a 30-18 vote. The House budget passed more or less along party lines last week, 53-43.
Questions? Contact a member of the Association’s Legislative Affairs team:
Posted in Advocacy News.