Protecting the Charter
September 5, 2013
The Northwest Credit Union Association had several top priorities for the Washington 2013 session:
Protect the credit union tax exemption.
With continued discussion around closing tax ‘loopholes’ as an alternative to raising taxes, all tax exemptions received additional scrutiny this year. An additional factor during the legislative session was the decision by the Washington Supreme Court, which declared the voter-approved two-thirds requirement for raising taxes (or repealing a tax preference) unconstitutional. Tax breaks then became easier to close than before—only requiring a simple majority to change.
The Association closely monitored the hearings and several bills that proposed repealing tax exemptions. In the end, the B&O tax exemption for state-chartered credit unions was not changed.
Protect credit unions from new & burdensome requirements.
Foreclosures remained high in Washington State, and consumer groups continued to test the Foreclosure Fairness Act (FFA), which credit unions were mostly exempted from. Additionally, at least one state agency (the Department of Labor & Industries) ran legislation to require financial institutions to perform data-matching as they currently do for other state agencies. In the end, the Association was able to rebuff efforts to place additional regulation on credit unions.
Protect the DFI’s reserves.
For the past several years, the state had been sweeping funds out of dedicated, non-appropriated accounts such as those maintained by the Department of Financial Institutions. In the end, the Association successfully argued that these types of sweeps eventually impact the operations of the Division, or result in fee increases, and was able to prevent efforts to sweep DFI funds.
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