Task force to resume its study of credit unions

The Legislature's Financial Institutions Task Force will resume its study of issues concerning Utah's credit unions and banks next interim session, task force co-chairman Rep. Jeff Alexander said Wednesday.

Reporting to the Business and Labor Interim Committee, Alexander, R-Provo, said the move by the state's three largest credit unions — Mountain America, America First and Goldenwest — to federal charters changed the focus of the task force.

The task force was established during the 2003 Legislature to study a slew of bank issues, including the possibility of taxing credit unions that some legislators said exploited their business income tax exemption and "acted like banks." The credit unions drawing the most heat during the session moved to the federal charter in early May, less than a week before the task force's first meeting.

"That brought up some new questions for us," Alexander told the committee. "It happened so quickly with the changes in the NCUA (National Credit Union Administration), and I guess the limits that they had at the time in allowing them to change their charter, that it kind of changed the focus of Sen. (Dan) Eastman and (me.)"

Eastman, R-Bountiful, is co-chair of the task force and co-sponsored the 2003 legislation with Alexander.

While task force members and industry leaders digested the meaning and ramifications of the new landscape of state-chartered credit unions, Alexander said the task force hasn't met.

"The senator and I decided not to take up the time of the members of the committee until we could develop a better strategy and direction for the task force."

What that could mean, Alexander said, is a broader examination of the state's credit union charter. Or, it could mean doing some housekeeping edits in the existing law, which included some "grandfather clauses" focused on the three biggest credit unions.

Whatever its new focus, the task force likely won't convene again until the next interim session. Wednesday's report concluded without comment or questions from the interim committee or the public.

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