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CUs Have Much To Be Thankful For, Cheney Notes

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WASHINGTON (12/2/13)--As credit union leaders prepared to celebrate Thanksgiving this week, Credit Union National Association President/CEO Bill Cheney in the Cheney Report noted that there is much to be thankful for in the credit union system.

"We are thankful there will be no corporate assessment scheduled for credit unions in 2014--which we had called for just this past summer--and that the likelihood of assessments in years beyond that is growing increasingly remote," he wrote. What's more, credit unions could see rebates for the funds paid into the Temporary Corporate Credit Union Stabilization Fund within the next four to five years. "That's certainly something to be thankful for considering where we've come from," Cheney said.

"We can be thankful that credit union members value their credit unions so much that they are willing to get politically active," as millions have used traditional methods and social media to tell their legislators "Don't Tax My Credit Union!" This level of involvement is a tribute to the great job credit unions do every day in serving their members, Cheney added.

Cheney also took time to thank the more than 86,000 credit union volunteers that serve their institutions and fellow members, and, overall, gave thanks for the "great system that we are all part of...A system that puts people first." Credit unions truly do believe, "people are worth more than money," Cheney said.

Cheney also noted developments on the regulatory front, where CUNA and credit unions are making some progress towards building credit unions a better operating environment, and working with the National Credit Union Administration to build a better exam experience for credit unions.

"Let's be thankful that more Americans are choosing to do business with credit unions," as total credit union membership crests 98 million. And, he wrote, "despite our many challenges in recent years, we can all be thankful that Americans have a credit union movement that is strong, safe and sound--and continues to be dedicated to the ideals of "not for profit, not for charity--but for service."

For more of The Cheney Report, use the resource link.

Dakota Bankers Plan Another Tax Push In Yankton, Vermillion

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BISMARCK, N.D. (11/27/13)--The South Dakota Bankers Association Monday presented a resolution proposal to the Yankton (S.D.) City Commission in support of taxing federal credit unions and farm credit system institutions.
 
Credit union advocates attended the meeting and successfully defended against the bankers claims, the Credit Union Association of the Dakotas (CUAD) reported (Memo Nov. 26).
 
The city commission tabled the resolution and will consider it at a later date.

South Dakota banks are attacking the credit union tax status on a county-by-county basis. On Nov. 19, South Dakota's Brookings County Commission Tuesday voted 4-0 to table a bank-backed resolution that would have supported taking the tax-exempt status away from credit unions and farm credit services. Speaking on behalf of South Dakota credit unions at the meeting were Dan Cumbee, CEO Dakotaland FCU, Huron, and Jeff Olson, CUAD vice president of advocacy and awareness (News Now Nov. 20).

Last week, state banks presented a similar proposal to the Yankton County Commission. The county commission also tabled the resolution. 

"As credit unions, we must continue to stand up for our members and our movement," said Olson. "No voice is stronger than our own credit union CEOs, managers, employees and volunteers."
 
Bankers also plan to present their proposal to the Vermillion City Commission on Dec. 2 and to the Vermillion School Board on Dec. 9, CUAD said. League representatives will attend each of the public hearings and are prepared to respond.
 
The Credit Union National Association and credit unions continue to advocate to preserve the current credit union federal tax status on a national level through the "Don't Tax My Credit Union" campaign. Credit unions are assigned that tax status because they are not-for-profit, member-owned cooperatives with the statutory mission to promote thrift and provide credit for provident purposes to their members.

CU System Briefs (11/27/2013)

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  • HARRISBURG, Pa. (11/27/13)--Pennsylvania credit unions participated in a district financial services roundtable with U.S. Rep. Charlie Dent (R-Pa.), according to the Pennsylvania Credit Union Association (Life is a Highway Nov. 25). Alan Musselman, chief financial officer of First Commonwealth FCU,  Lehigh Valley, and a member of PCUA's Governmental Affairs Committee, and Paul Wagner, president/CEO, Hershey FCU, Hummelstown, participated in the event hosted by the Federal Home Loan Bank. The event allowed representatives from financial services, builders, realtors and the Pennsylvania Housing Finance Agency to voice concerns about the challenges they face in today's operating environment. PCUA Vice President, Governmental Affairs Christina Mihalik also attended. Conversation focused on the Dodd-Frank Act, the PATH Act, GSE reform, environmental protection standards and healthcare. Pictured from left are Dent and Wagner. (Photo provided by the Pennsylvania Credit Union Association) ...

CUNA Closed Thursday, Friday, No News Now

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WASHINGTON and MADISON, Wis. (11/27/13)--The Washington, D.C., and Madison, Wis., offices of the Credit Union National Association will be closed Thursday and Friday, in observance of the Thanksgiving holiday. There will be no regular issues of News Now those days. News Now will resume regular publication  Monday.

Federation Previews Secondary Capital Report At Forum In Asia

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NEW YORK (11/27/13)--An analyst for the National Federation of Community Development Credit Unions presented an upcoming federation report on secondary capital and its use by U.S. community development credit unions (CDCUs) at the Fourth Annual Asia Future Forum in Seoul, Korea.
 
National Federation of Community Development Credit Unions Analyst Cathi Kim presented information from an upcoming federation report on U.S. community development credit unions' use of secondary capital at a session of the Fourth Annual Asia Future Forum in Seoul, Korea. (Photo provided by the National Federation of Community Development Credit Unions)
Cathi Kim, federation analyst, represented the federation at the forum, whose theme was "Era of Inclusive Growth: Innovation of Enterprise and Society" and which focused on innovations in social economy. The event attracted more than 500 attendees from Japan, China and Korea.
 
Presenting at the Community Finance session Oct. 31, Kim provided background on the products, services and delivery systems that U.S. CDCUs provide to low- and moderate-income Americans.
 
Secondary capital, or supplemental capital, is of particular interest to Korea's credit unions, which have continued to grow in deposits and loans despite the downturn in the global economy, said the federation.  "Secondary capital loans are long-term loans that growing credit unions can use to expand lending in their communities," Kim said. "Secondary capital counts toward the credit union's net worth for the initial period of the loan, improving net worth and helping credit unions meet required capital standards. Several federation members have used secondary capital loans to great success," she said.
 
Korea's credit union movement is the fourth largest worldwide, with 950 credit unions, six million members and US$52 billion in assets. The National Credit Union Foundation of Korea describes the movement there as providing "high value financial services for low and middle income families while promoting the value of cooperation."
 
Kim said interest among forum attendees was particularly high because there is no CDCU equivalent in Korea.  She noted it is "important to strengthen and solidify the basis for social finance, especially community finance [which] is increasing around Seoul."
 
The federation will announce its next funding round, including secondary capital, later this month.

Kentucky's Lyons Named AACUL Chairman

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WASHINGTON (11/27/13)--Wendell Lyons, president/ CEO of the Kentucky Credit Union League, was elected chairman of the American Association of Credit Union Leagues at the group's recent annual meeting.
 
Scott Simpson, president/CEO of the Utah Credit Union Association, was elected to serve on the board.
 
Other AACUL board members include:
  • First Vice Chairman--Tracie Kenyon, president/CEO, Montana Credit Union Network;
  • Second Vice Chairman--John Radebaugh, president/CEO, North Carolina Credit Union League;
  • Treasurer--Mark Cummins, president/CEO, Minnesota Credit Union Network;
  • Secretary--Simpson;
  • Immediate Past Chair--Bill Mellin, president/CEO, Credit Union Association of New York; and
  • Executive Director-- Susan E. Newton, executive vice president, System Relations, Credit Union National Association.
Also, Paul Mercer, president/CEO of the Ohio Credit Union League, was honored with AACUL's Eagle Award for his outstanding achievements, both at the league level and beyond; his dedication to credit union and personal principles; his unflagging focus on important issues; and for implementing new and creative ideas. 
 
The Eagle Award is not given annually, but only when a recipient is deemed worthy of selection.

SECU Foundation Awards $1M Grant To Hospice Center

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RALEIGH, N.C. (11/27/13)--Sta
Click to view larger imageJim Barber, board chair of the SECU Foundation, the charitable arm of Raleigh, N.C.-based State Employees' CU, presented a check for $1 million to Michelle Anderson, chairperson of the Hospice House Foundation of Western North Carolina, to bring the first inpatient hospice facility to six counties in North Carolina. (Photo provided by SECU Foundation)
te Employees' CU (SECU) Foundation presented a $1 million grant on Monday to a facility that will bring inpatient hospice care to six counties in North Carolina.
 
The charitable arm of SECU presented the money in Franklin, N.C., for the SECU Family House of Western North Carolina--an affiliate of the Hospice House Foundation of Western North Carolina--which will serve Macon, Swain, Graham, Cherokee and Jackson Counties.
 
The foundation first committed to a $1 million challenge grant in August to aid the Hospice House Foundation.
 
SECU Foundation Board Chair Jim Barber, who presented the check to the Hospice House Foundation, said that the credit union's members "continue to embrace these statewide initiatives, recognizing the great need for inpatient hospice services throughout North Carolina." The credit union's foundation has supported 12 hospice projects in the state.
 
SECU is based in Raleigh, N.C., and has a total of $26.7 billion in assets.

Health Insurance Options Explored In CUNA HR/TD Council Paper

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MADISON, Wis. (11/27/13)--A new white paper from the CUNA HR/TD Council explores the viability of self-funded employee healthcare plans.
 
The paper, "Health Insurance Plan Options: Self-Funded and Fully Insured," explores how organizations of all sizes are turning to self-funded plans to reduce and manage their health care costs and improve cash flow while still delivering the health coverage they desire for their work force.
 
In self-funded plans, the employer takes on the financial risk of funding its health plan from its assets and becomes responsible for managing and administering the benefit plan.
 
Self-funded plans are governed by the Employer Retirement Income Security Act (ERISA) and appeal to employers because of the greater flexibility that comes with tailoring the plan to their needs with fewer state-mandated features.
 
Among the advantages the paper cites for self-funded employee healthcare plans:
  • Control. Advocates for self-insurance say it's the difference between managing and leveraging the credit union's assets versus just paying premiums. The organization also assumes control of the specific health needs of its employee population.
  • Potentially lower costs. An organization can save 10%-25% of costs by going to a self-funded benefits plan, according to the Self-Insurance Institute of America Inc., the largest U.S. self-funding trade group.
  • Direct benefit. With a self-funded health plan, the employer reaps the benefits of its investment when plan results beat expectations.
  • Use of employee health data. With self-insurance, an employer can collect claims data that can pinpoint health issues that are driving claims costs and provide focused wellness solutions. That means savings because the credit union can target health and wellness efforts toward actual employee experience.
  • Customization. The employer can set premiums based on its employee claims history and adjust the plan in other ways to cut costs. If claims are lower than anticipated, the employer can invest any savings and earn interest.
  • Exemption from most state insurance regulations. Plan sponsors and employers have self-funded their medical plans for more than 30 years, a result of the passage of ERISA.  ERISA exempts self-funded plans from state insurance laws including reserve requirements, mandated benefits, premium taxes, and consumer protection regulations. As a result, an employer can make available uniform, targeted benefits to employees no matter what state they work.
  • Greater flexibility in how the benefits are designed. With a self-funded plan, the organization is basically unraveling or unpacking what it has in a traditional outside insurance company's health plan. It can examine each aspect of what goes into health coverage and decide how to proceed.
 To download the paper, use the link.

Illinois Foundation Awards $31K In Year's Final Grant Round

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NAPERVILLE, Ill. (11/27/13)--The charity arm of the Illinois Credit Union League announced Tuesday that it is giving $30,790 in grants to member credit unions and ICUL chapters.
 
The Illinois Credit Union Foundation awards are going to small-credit union development, community service, market and business development, and financial independence and revitalization efforts.
 
The 16 credit unions receiving a combined $19,340 in small-credit union development grants for software and hardware development are:
  • Alton & Southern Railroad Employees FCU, in East St. Louis;
  • Aurora Postal CU, in Aurora;
  • Cosmopolitan FCU, in Chicago;
  • Decatur Policemen CU, in Decatur;
  • Electric Energy Employees CU, in Metropolis;
  • Electrical Workers CU, in Collinsville;
  • Fairmont Village CU, in East St. Louis;
  • Fellowship Baptist Church CU, in Chicago;
  • Pilgrim Baptist CU, in Chicago;
  • School District No. 9 CU, in Granite City;
  • Sherwin Williams Employees CU, in South Holland;
  • Shiloh Baptist FCU, in Waukegan;
  • Shiloh Englewood FCU, in Chicago;
  • St. Helena CU, in Chicago;
  • St. Jude CU, in Chicago; and
  • Williamson County Catholic CU, in Herrin.
Recipients of the community service grants--worth a combined $2,540--for participation in local community projects are:
  • Education Personnel FCU, Danville;
  • Midwest America FCU, Danville;
  • South Division CU, Evergreen Park;
  • The ICUL Danville Area chapter; and
  • The ICUL Southern Illinois chapter.
These awards will go to projects such as shred days and essay contest for kids.
 
Recipients of the $6,500 in marketing and business development grants--to help credit unions with under $30 million in assets expand outreach--were:
  • Altonized Community FCU, Alton;
  • IBEW Local 146 CU, Decatur;
  • CBI FCU, Plainfield; and
  • SOURCEONE CU, Chicago.
These awards were given to credit unions seeking to introduce new products and promote among a select employee group.
 
The Kane County Teachers CU, Elgin, also received a $2,500 financial independence and revitalization grant, for an initiative to reach out to the Hispanic community in low-income and underserved areas.
 
The Illinois Credit Union Foundation has awarded a total of $109,000 in grants in 2013.