BEAVERTON, Ore. (1/29/13)--Taxing Oregon's credit unions would yield little in state revenue but would cost Oregonians tens of millions of dollars annually in direct financial benefits, says an op-ed column by the Northwest Credit Union Association.
The article, written by NWCUA President/CEO Troy Stang and published in The Oregonian (Jan. 25), is a response to a bank commentary about credit unions' tax status that suggested restructuring credit unions like banks. NWCUA and credit unions oppose three bank-supported bills introduced in the Oregon legislature that would end credit unions' tax status and initiate Community Reinvestment Act-like requirements for credit unions.
Preserving credit unions' tax-exemption is the top priority of the Credit Union National Association and will be the No. 1 issue at CUNA's Governmental Affairs Conference Feb. 24-28 in Washington, D.C. (See today's News Now story, Cheney advocates for CU tax status on Hill.")
"The credit union model, regardless of a credit union's size, is as relevant and critical to consumer choice as ever before," said Stang in the article.
"As a not-for-profit institution, owned by members, the cooperative model of shared benefits stands in stark contrast to the stockholder-focused banks and the constant drive to increase profits through higher fees and loan rates," Stang wrote.
Banks criticize credit unions "for consolidating into larger institutions in order to provide better products and services to consumers" and omit the fact that credit unions pay property and payroll taxes and members pay income taxes on the earnings they receive, he said. "Without a not-for-profit alternative for consumers, there would be little incentive for banks to restrain their ever-increasing drive to grow income through escalating fees. This would impose direct harm on consumers and businesses during a time of economic difficulty," Stang wrote.
The Federal Credit Union Act was signed into law in 1934 "to make credit available through nonprofit, cooperative credit unions," said Stang. "Indeed, during the most recent recession, credit unions were increasing their support of local businesses when banks were not willing or able to, demonstrating why the role of the not-for-profit credit union is as critical today as ever before. It is no wonder that Congress and every president, Republican or Democrat, since that time has reaffirmed the right of citizens to form their own financial cooperative."
Credit union membership and assets have grown, he said, and "to Oregon credit unions, that is the litmus test of quality of service" to their 1.4 million members. "It seems Oregonians are speaking with their feet," he concluded
For the full article, use the link.