Thursday, April 2, 1998

HOUSE PASSES H.R. 1151 ON A ROLL CALL VOTE OF 411-8

  The CU Membership Access Act is half-way home: The U.S. House 
of Representatives passed H.R. 1151 by an overwhelming vote of
411-8 Wednesday.
  The measure came to the floor with 207 co-sponsors from both
sides of the aisle in Congress--a result of months of hard work
by credit unions and leagues at the grassroots level.  The
legislation passed as a stand-alone bill under an expedited
parliamentary procedure called suspension of the rules that
required a two-thirds vote of those present on the floor.
  H.R. 1151 lead sponsors Reps. Steven LaTourette, R-Ohio, and
Paul Kanjorski, D-Pa., made a strong case for the legislation in
remarks on the House floor prior to the vote.
  "H.R. 1151 should not be considered pro-credit union or anti-bank,
" emphasized LaTourette.  "Instead it should be viewed as it
was intended:  as pro-consumer and pro-competition."  He noted in
particular how the legislation will restore credit union access
for millions of small-business employees.
  LaTourette also credited the behind-the-scenes work of House
Speaker Newt Gingrich, R-Ga., in support of the legislation.
  Kanjorski stressed the legislation "will maintain the existence
and growth of the credit union movement and will not unduly
interfere with the banks in any way."
  House Banking Chairman Jim Leach, R-Iowa, added:  "We have
moved quickly for a deliberative legislative body.  Credit unions
represent democracy in the marketplace, and this legislation will
go a long way to ensure credit unions continue to play that vital
role."  The measure passed the Banking Committee unanimously last
Thursday.
  Others speaking out on behalf of the legislation included Reps.
John LaFalce, D-N.Y., the banking committee's ranking minority
member, House Rules Committee Chairman Gerald Solomon, R-N.Y.,
House Financial Institutions Subcommittee Chairman Marge Roukema,
R-N.J., Bruce Vento, D-Minn., the senior Democrat on the
financial institutions subcommittee, and House Minority Whip
David Bonior, D-Mich.
  CUNA President & CEO Dan Mica called the House vote a "great
victory" for credit unions. "But the ones who truly benefit from
today's House vote are millions of American consumers who are now
a major step closer to regaining their ability to choose credit
unions for affordable financial services."
  Mica credited the work of leagues and credit unions at the
grassroots level for keeping the momentum going in the House.  He
stressed the focus of credit union grassroots lobbying must now
shift to the Senate.
  "We have legislation through the House, but until this bill
becomes law, millions of Americans particularly those working for
small businesses are still being blocked from joining credit
unions."  Mica said he hopes the Senate will be spurred on by
today's House vote to accelerate its consideration of legislation
restoring credit union choice for consumers.
  Credit unions are urged to contact their senators in support of
the CU Membership Access Act and call to arrange visits to local
offices when senators are back in their states during the spring
recess, scheduled to begin later this week.

IF YOU WEREN'T TUNED INTO C-SPAN ...

  If you weren't tuned into C-SPAN or sitting in the House
gallery, here's what some of the supporters had to say before
they and colleagues voted on H.R. 1151.
  House Banking Committee Chairman Jim Leach, R-Iowa: "Credit
unions represent democracy at work in the marketplace and this
legislation will go a long way toward ensuring they remain an
integral part of the American way of life....  People must come
before profits."
  House Banking Committee Ranking Minority Member John LaFalce,
D-N.Y., said the bill is a winner for credit unions, consumers,
thrifts, and banks--noting that the latter two groups did testify
and the bill carries bank-like capital requirements and
regulation as a result.
  Rep. Marge Roukema, R-N.J., said H.R. 1151 is swift action
following the Supreme Court decision and should prevent further
court problems ... it protects 20 million hard-working savers ...
and it incorporates many of the Treasury Department's capital and
audit recommendations.
  Rep. Bruce Vento, D-Minn, said it remedies the Supreme Court
decision ... recognizes the economy has changed since 1934 ...
and sets policy and a path for the future.
  Rep. Steve LaTourette, R-Ohio, a lead sponsor, called it a
"wonderful day" for 70 million credit union members ... credited
Reps. Gingrich, Leach, LaFalce, Vento, and Roukema for
willingness to act ... and credited Clark General FCU, Wickliffe,
Ohio--a credit union forced to turn to multiple groups to
survive--for inspiration.
  Rep. Paul Kanjorski, D-Pa., the other lead sponsor and a page
in the 83rd Congress, said the bill was brought forward "in the
best interest of bipartisanship" ... no winners, no losers, just
good, solid legislation.
  House Rules Committee Chairman Gerald Solomon, R-N.Y., said it
took courage to sponsor the bill, which should encourage savings
... noted that credit unions are people focused, not profit
oriented ... and said the issue came down to a battle between
rich banks and working Americans.
  Rep. David Bonior, D-Mich., said, "I love my credit union" ...
because of all the businesses I've dealt with, the credit unions
provide the best service, fair rates, with a sense of community."
  Rep. Bernard Sanders, I-Vt., said, "Credit unions today are
more important than they have ever been.  H.R. 1151 will allow
them to grow rather than wither away."  They're a not-for-profit
alternative to banks.
  Rep. Ben Gillman, R-N.Y., said credit unions do not damage
banks, do not cheat taxpayers, but provide a public service by
providing small accounts without heavy fees.
  Rep. Carolyn Cheeks Kilpatrick, D-Mich., said, "I support
banks; I support credit unions."  It's a large financial market
in which credit unions have only 2% of market.  The bill is 
pro-consumer, pro-competition.
  Rep. Ron Klink, D-Pa., said the steel mills and railroads that
started many credit unions have shrunk.  Multiple groups will
preserve membership opportunities ... and he noted 89% of credit
union members also do business with banks.
  Rep. Bob Filner, D-Calif., said, "What's better for this
country than an institution organized and run by its members."  
H.R. 1151 is about choice ... You need 500 members to start a
credit union ... and my district is filled with small employers.
  Rep. Sheila Jackson-Lee, D-Texas, said credit unions represent
democracy at work.

TRADE PAPER CREDITS GINGRICH, TIPS HAT TO MICA

  Perhaps the most critical vote on H.R. 1151 came during the
House Banking Committee meeting last Thursday, when supporters
narrowly turned back an amendment to cap business loans by a vote
of 27-25.  A loss there could have encouraged more amendments.
  The AMERICAN BANKER (April 1) credits House Speaker Newt
Gingrich as "the unseen force driving the House Banking
Committee's action on credit union legislation....  Rep. Gingrich
pulled strings before and during the meeting to ensure
controversial amendments were defeated or withdrawn."
  The BANKER report also credits Rep. John A. Boehner, R-Ohio,
who leads the congressional task force overseeing financial
reform legislation, for calling Republican committee members.
  And the BANKER pays tribute to CUNA President & CEO Dan Mica's
lobbying technique.  It notes before the bill markup meeting,
Mica "took the unusual step of introducing himself to each
reporter at the packed press table."  
  The report says Mica worked the committee room and nearby
hallways, chatting with Rep. Joseph P. Kennedy II, D-Mass.,
before he introduced his amendment to clarify the term "people of
modest means" by adding parenthetically "people of low- and
moderate-income."  And when the voting was over, "Mr. Mica walked
over to the podium, shook hands with House banking Committee
Chairman Jim Leach and signaled the two would talk later by
phone."

KIPLINGER'S GIVES KUDOS TO CUs FOR LOWER FEES, RATES

  KIPLINGER'S PERSONAL FINANCE MAGAZINE (May 1998)
lauds credit unions' lower fees, lower interest rates, and higher dividends
compared to banks and savings & loan institutions.  Citing
statistics from CUNA and the Consumer Federation of America,
KIPLINGER reports:
 * Twice as many credit unions (64%) as banks offer free checking
with no minimum balances, and only 47% of credit unions impose
fees on interest-bearing checking accounts ($4.56 per month with
29 free checks) vs. 99% of banks ($7.71 per month with 17 free
checks);
 * Credit unions charge less than banks for overdraft fees
($15.42 vs. $17.39) and stop-payment fees ($9.51 vs. $15.05);
 * The average credit card rate is 13% at credit unions and 18%
at banks; credit unions' new-auto interest rates average a full
percentage point lower than banks'; and
 * The 50 largest credit unions pay an average 2.1% for interest-bearing 
checking, while banks pay 1.2%. Credit unions pay an
average 5.6% on one-year share certificates, compared to 4.9% at
banks.
  KIPLINGER also covers the Supreme Court's decision to restrict
credit union membership.