Hill fight on credit unions a prelude?

It has been called a battle, a fight, a war, a skirmish. Whatever the adjective du jour, credit unions and banks were in the thick of things again during the 2005 Utah Legislature.

From the first week of the session when a joint resolution was introduced to the penultimate week when an 11th-hour bill surfaced, lawmakers wrangled over credit unions.

HJR1 was introduced the first day of the session. Thirty-eight days later, after heated debate on the House floor and in committee hearings, it passed. The resolution asks the U.S. Congress to re-examine rulings by the National Credit Union Administration, including those regarding fields of membership for Utah's federally chartered credit unions; allow states and local governments to levy the same taxes on federally chartered credit unions as are imposed on state-chartered ones; and provide states with an explanation for maintaining the current tax structure, if it decides to do so.

Sponsoring Rep. Jeff Alexander, R-Provo, disputed that the session was overly embittered.

"Obviously there's always strong debate within each house and between the two houses," he said. "I'm pleased with the way the session has gone. I don't believe it has been contentious.

"I always felt it was important, because we need now to redefine what our state charter is. We're really waiting for the lead of the federal government. . . . I'm waiting to see if things change at the NCUA or if Congress believes that the federal charter is where it ought to be."

The same day HJR1 was signed by the House speaker, another bill emerged from the House Rules Committee. The committee sent HB277, "Revisions to the Credit Union Act," to the House Business and Labor Standing Committee for debate. After a procedural game of hot potato, it received a hearing on Feb. 24 — the final day of committee meetings.

Sponsored by Rep. LaVar Christensen, R-Draper, HB277 defined a "meaningful affinity and bond among (credit union) members" and gave credit union members a "substantive and informed choice" on whether to return excess net income to members as cash dividends or use that income to fund capital improvements and expansions.

Christensen told the committee the intent of HB277 was simply to codify the credit unions' own public position. Credit union advocates disagreed, strongly. As of press time Wednesday, HB277 had not come up for a vote.

For all of their differences, one issue credit union and bank advocates did agree on was that the 2005 session was part of a larger fight — one that likely will continue.