Oregon Legislative Update: Credit Union Update Bill Scheduled for Hearing
February 23, 2015
February 23, 2015
Kate Brown was sworn in as Oregon’s 38th governor last Wednesday. Brown gave a six-minute speech calling for additional ethics reforms, more transparency in government and vowed she and her staff would not take any compensation other than their respective salaries. Prior to election to the Oregon House, Brown was a family law attorney. She also served as the Senate majority leader prior to being elected secretary of state. Brian Shipley was named chief of staff. Shipley had been the chief lobbyist for OHSU, and was Brown’s chief of staff when she was Senate majority leader. He also worked for Governors Kulongoski and Kitzhaber.
Salem is now waiting for the next secretary of state to be appointed by Brown. According to the Constitution, the new governor will select the secretary of state, and has an unlimited amount of time to choose her successor. For the time being she has appointed Robert Taylor, her deputy, to serve as Interim secretary of state. There will be an election for governor in 2016 and the secretary of state position will be up in 2016 as well. Speculation about who Governor Brown will appoint to this post is rampant, with both the House and Senate majority leaders interested in the position.
Issues in the Oregon Capitol
Last week, the state economist provided a quarterly estimate of the state general fund revenues. With Oregon’s economy growing, the state income tax kicker would kick in, which means state income taxpayers would receive a rebate on their personal income taxes, totaling about $350 million. The May forecast is used to balance the 2015-17 general fund budget.
Also, last week the Senate passed the controversial Low Carbon Fuel Bill (SB 324) on a 17-13 vote. The debate lasted over four hours, with Republicans raising concerns over the conflict of interest the former governor and first lady had surrounding this issue and her outside contracts. Next week this bill is scheduled in the House committee.
HB 2700, a controversial class action bill that passed the House last week, passed out of the Senate Judiciary Committee this week as well. This bill, along with the low carbon fuel bill, is being fast tracked, and could be up on the Senate floor next week. The bill is opposed by the business community, and could impact a current class action case against the state lottery that is estimated to be worth $134 million.
Oregon Credit Unions
The Chair of the Joint Committee Implementing Measure 91 (Marijuana) asked the Northwest Credit Union Association to testify before the committee in its upcoming hearing on “banking and marijuana” on Wednesday, February 25. We are busy preparing for the hearing and look forward to providing a credit union perspective.
HB 2415, Deceased Member Accounts:
The NWCUA worked with the state on HB 2415. The bill allows the Department of Human Services or Oregon Health Authority to request financial institutions to release specified information regarding deposit accounts held by deceased persons and creates exception to prohibited release of private financial records.
SB 582, Update to Oregon Credit Union Act:
We were pleased to hear that SB582 will be heard for its first hearing on Wednesday, March 4. Here is a little more background on our bill:
- Board Stipends – Allow Oregon credit unions the option to provide reasonable compensation to their directors. This change helps credit unions attract and retain qualified directors at a time when numerous circumstances make that increasingly difficult. For example:
- In recent years, directors have become subject to substantially greater demands on their time due to expanded regulatory requirements for board involvement in operational policies and activities, educational requirements, and increased complexity of the technological, financial, social, and legal environment in which credit unions operate.
- Board members are exposed to greater liability exposure than ever before.
- Many other profit and non-profit organizations compete with credit unions to attract directors from a limited pool of qualified candidates.
- Membership – Amend state law to remove the requirement to open a share account as a condition of membership. Credit unions can only serve persons who qualify as members. Members must be within the credit union’s field of membership and must satisfy other membership requirements specified in the Oregon Credit Union Act (the Act) and the credit union’s bylaws. The Act currently requires a potential member to open a share account in order become a member. In some cases, a person wishes to become a member in order to establish a credit relationship (credit card, car loan, etc.) SB 582 would allow persons within the field of membership to become a member based on the credit relationship or on payment of a membership fee (if the credit union determines to do so). This avoids the need to establish a share account with a minimal balance (usually $5 or $25), which is costly for the credit union to maintain and serves no purpose for the member.
- Membership – This section removes outdated language in ORS 723.188 which requires any credit union that serves state employees to include foster parents in its field of membership. The bill replaces this requirement with a definitional change that would include foster parents and legally appointed guardians in the definition of relatives eligible for membership. This technical change moves the historical provision for foster parents to the field of membership provisions, where it is a better fit, and where it applies to all credit unions rather than just credit unions that serve state employees.
- Supervision & Regulation – Remove the requirement that the DCBS approve new branches. Establishment of branches is an operational decision that should not require regulatory approval. Federal credit unions are not subject to approval for new branches. Branch establishment remains subject to fixed asset limitations and safety and soundness considerations.
Questions about this story? Contact James Pearson: 206.340.4790, email@example.com.
Posted in Advocacy News.