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Election 08 Whats new for CU advocacy

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WASHINGTON (1/23/07)—The Credit Union National Association (CUNA) announced Wednesday that it soon will be offering four new online courses for credit union representatives interested in political advocacy. The fist two sessions will instruct credit unions on how to communicate the credit union difference to their public officials and communities and effective ways to initiate direct lobbying efforts on a grassroots level. Joann Sordellini, political communications manager for CUNA, said those initial courses will be available online to CUNA members now and will be quickly followed by two additional offerings. One of those will address campaign involvement and what credit unions can do to support credit union-friendly candidates and to get out the vote among their members. The other will explore public affairs and communications strategies and will provide how-to tips for communicating credit union issues to local public official. The courses are free and certificates will be awarded by CUNA upon successful completion of each segment. Richard Gose, CUNA senior vice president of political affairs, said, “The more educated a credit union member we have, the better it is for credit unions. “ Also in the political affairs arena, CUNA is about to launch a new round of its campaign schools, seminars that are intended to encourage credit union professionals and volunteers to run for office in any political race, from local school board to state legislature. In February, CUNA will return to Montana and conduct four sessions across the state with an expected 50 participants in each. Later in the year, CUNA will offer the schools for the first time in Ohio and New Mexico. Also for the first time, CUNA will run a demonstration campaign school at its Government Affairs Conference in Washington, scheduled from March 2-6. The abbreviated session will be presented over three days and is intended to give participants an idea of what it is like to organize a campaign.

Dodd wants housing measures in stimulus package

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WASHINGTON (1/24/08)—Senate Banking Committee Chairman and former presidential hopeful Chris Dodd (D-Conn.) sent a letter to the Senate majority leader this week saying he wants to create a new government corporation to buy troubled mortgages and refinance them mostly into Federal Housing Authority (FHA) loans. Dodd told Majority Leader Harry Reid (D-Nev) that his plan would need up to $20 billion of President George W. Bush’s proposed economic stimulus package to act as seed money. Dodd said the primary cause of the nation’s current economic woes is the collapse of its housing market and added he believes a stimulus package must address “the problems that confront the housing market, distressed homeowners and their communities.” “I also believe that a stimulus package should address some of the labor market problems caused by the massive layoffs and downturn in the housing market. One way to stimulate this vital sector of our economy is to invest in targeted infrastructure projects,” Dodd wrote in his Jan 22 letter. He said that an additional $2 billion invested into existing transit projects would create almost 100,000 jobs. Dodd said he is currently drafting a proposal to create a Federal Homeownership Preservation Corporation to purchase outstanding mortgages at steep discounts. He said his plan would ensure that lenders and investors “take a ‘haircut’” and are not being bailed out. The senator proposed $10 billion to $20 billion in initial capitalization. He also asked that a stimulus package include $10 billion for the purchase and rehabilitation of foreclosed properties by local governments through community development block grants (CDBG). He added that FHA modernization should be included in a stimulus package to provide distressed borrowers with new sources of mortgage capital thereby, he said, helping many save their homes. He said that raising Fannie Mae and Freddie Mac conforming loan limits temporarily would also start to bring liquidity back to mortgage lending and would help restore housing markets.

Mica says its no time for partisanship on the Hill

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WASHINGTON (1/24/08)—Nothing can bring out partisan politics quite like a presidential election year, says Credit Union National Association (CUNA) President/CEO Dan Mica, but 2008 is just the time to put divisiveness aside so Congress can successfully take up the challenges it faces. Mica, in his most recent appearance as guest columnist in The Hill, said CUNA and other groups that traditionally work in a bipartisan fashion have an advantage—and this year particularly. “Any legislative or lobbying effort that falls along party lines is likely dead from the start. There simply is not the time to hash out differences,” Mica said, pointing to the greatly abbreviated time Congress will be in session this year because of elections. Noting that there will be a scant 100 days to conduct real legislative business, Mica says what also will die out fast will be bills addressing divisive issues. It is almost certain, for example, that any effort designed to tackle immigration will not survive this session. Controversial presidential nominations and judicial appointments will come to a standstill. The CUNA leader says he remains an optimist about what can be accomplished this year, particularly as members of Congress conclude early that they need to find common ground to move quickly on certain issues. However, Mica adds, “Bottom line, 2008 is a challenge, and it may be difficult for anyone to call this a landmark year in Congress.” Mica appears regularly in the Capitol Hill publication The Hill’s as a guest columnist for its K Street Insiders feature. "K Street" refers to an area in Washington, D.C. known as a base for influential lobbyists, think tanks and advocacy groups stationed in the nation's capital. Use the resource link below to read more Mica comments.

NCUA to look at fiduciary clarifications more

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ALEXANDRIA, Va. (1/24/08)--The National Credit Union Administration (NCUA) is scheduled today to take up its rules related to credit union board fiduciary responsibilities at its monthly board meeting. The federal regulator is expected to issue an advance notice of proposed rulemaking intended to more clearly define a board’s fiduciary duties in the face of major decisions, such as mergers or conversions to mutual thrifts. The proposal would seek to amend Parts 708a and 708b of NCUA's "Rules and Regulations--Mergers, Conversion from Credit Union Charter, and Account Insurance Termination." The agency will seek comments. Also on the agenda, the board will evaluate credit unions' federal usury rate ceiling, which the Federal Credit Union Act requires every 18 months. The rate currently is set at 18%. As is routine, the open board meeting will be followed by a closed session. Observers of acquisition efforts by three Colorado credit unions for Norlarco CU of Fort Collins will be watching to see if the agency uses the session to act on bids. John McKechnie, NCUA director of public and congressional affairs, would not confirm a date for a bid decision and would not identify items to be addressed at the closed NCUA meeting. Norlarco was placed into conservatorship by Colorado state regulators in May after a number of its construction loans issued in Lee County, Fla., became delinquent. In July, the NCUA took control of the credit union and removed its board of directors. The NCUA has never identified the bidding organizations. However, Ent FCU, a $2.292 billion-asset Colorado Springs-based institution, has confirmed it is one of three credit unions interested in purchasing Norlarco. The others were identified by the Nov. 27 issue of The Coloradoan newspaper as Bellco CU, Greenwood Village; and Public Service Employees CU, Denver. The NCUA had expected to approve a purchase-and-assumption agreement for Norlarco by the end of last year, according to a letter to credit union members posted in November on the Norlarco website. However, despite the agency’s desire to approve a successful resolution as soon as possible, broader market conditions have made it a longer process than at first expected, according to a source close to the situation. Service to Norlarco members has continued uninterrupted.

CUNA financial literacy partner tapped by Bush

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WASHINGTON (1/24/08)--The National Endowment for Financial Education (NEFE)--CUNA’s partner in expanding financial literacy education throughout U.S. schools--was named to President George W. Bush’s newly established President’s Advisory Council on Financial Literacy. NEFE President/CEO Ted Beck will represent the organization on the president’s council. The White House said the 19-member council will focus exclusively on economic empowerment issues. It will operate under the guidance of the U.S. Treasury Department with the specific charge of “keeping America competitive and assisting citizens in understanding and addressing financial matters." Charles R. Schwab, chairman/CEO of the Charles Schwab Corp., will serve as the council's chairman. Operation HOPE Founder, Chairman/CEO John Hope Bryant was named vice-chairman. Cutler Dawson, president/CEO of Navy Federal CU in Merrifield, Va., also will serve on the council.

House Financial Services to list years agenda

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WASHINGTON (1/24/08)—The chairman of the House Financial Services Committee, Rep. Barney Frank (D-Mass.), has scheduled a news conference for 10:30 a.m. (ET) today to reveal his committee’s 2008 agenda. Ryan Donovan, vice president of legislative affairs for the Credit Union National Association (CUNA), said Wednesday that almost certainly President George W. Bush's propopsed economic stimulus package and actions to contain the sub-prime mortgage credit crisis will be at the top of the Chairman's priorities. “In the atmosphere in Washington right now is a sense of urgency for dealing with what appears to be a steep economic downturn and may even be a recession. There's no doubt that Congress wants to do something, and do it quickly,” Donovan said. After those issues, Donovan said, the committee’s agenda for 2008 can only be made clear by the chairman. “It is a volatile time right now and it is a very short legislative year because of the federal elections--with Congress expected to be in session just under 100 days,” Donovan added. (See related story, “MICA says it's no time for partisanship on the Hill.”) While CUNA views it as a short legislative year, Donovan said he was not short sighted about the importance of the committee's hearings and mark-ups this year. "I think much of what the committee will do over the next several months will be as much as about getting legislation enacted in the short-term as it will be about laying the groundwork for Congress to take more comprehensive legislative action over the next several years," he said. “Based on what the chairman has said previously, I think it is reasonable to expect that Rep. Frank will take up some form of credit card legislation early in the year," Donovan said. "I wouldn't be surprised to see overdraft protection legislation back on the committee's agenda. We expect a hearing on credit union issues in the first quarter of the year. And, Chairman Frank has said previously he would like to hold a hearing on the Community Reinvestment Act. There are certainly a lot of ways he could go." CUNA will be very active in its efforts to work with committee staff on the key issues, reiterated Donovan, and it remains very positive about the prospects for important credit union legislation, including the Credit Union Regulatory Improvements Act. "But we also are very cognizant that Congress has megalithic issues before it just now, issues that will influence much of the legislative session,“ Donovan said.

Inside Washington (01/23/2008)

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* WASHINGTON (1/24/08)--On Tuesday, Steven Preston, head of the Small Business Administration (SBA), said that loan volume for SBA’s signature loan program has decreased, and that originations dropped to 20,000 in the fourth quarter (American Banker Jan. 23). The agency is attempting to expand participation in its loan guarantee program, but Preston noted several roadblocks: slow loan turnaround times, a lack of support services for lenders, complex rules and paperwork. Because of these roadblocks, the SBA has lost 368 financial institutions the past two years--a 7% decline, Preston said. In November, the agency started a program to speed up payments of loan guarantees, but it faces challenges such as inefficient workflows and information technology systems. It could take until April or May to streamline the program, he said ... * WASHINGTON (1/24/08)--Rev. Jesse Jackson met with three Department of Housing and Urban Development (HUD) officials Tuesday after his Rainbow Push Coalition met at HUD’s offices to rally for action on the foreclosure crisis (American Banker Jan. 23). The coalition was briefed on Federal Housing Administration loans and a Hope Now alliance plan that would freeze starter interest rates on certain subprime mortgages. Meeting participants included FHA Commissioner Brian Montgomery, HUD Secretary Alphonso Jackson and Deputy Secretary Roy A. Bernardi ...