Today, we wrote a letter to House and Senate conferees on the highway transportation bill, in support of Section 75001 and Section 82001 of H.R. 22 (The Surface Transportation Reauthorization and Reform Act of 2015), as passed by the House.  These sections, which were offered as an amendment to the bill by House Financial Services Committee Chairman Jeb Hensarling, passed the House by voice vote. 

Section 75001 and Section 82001 would remove two regulatory barriers by modernizing privacy notifications and permitting privately insured credit unions to join the Federal Home Loan Bank System.

Privacy Notice Modernization

Section 75001 is based on bipartisan legislation (H.R. 601) introduced by Representatives Blaine Luetkemeyer (R-MO) and Brad Sherman (D-CA).  An example of legislation that both reduces regulatory burden and improves consumer protection, this provision would require financial institutions to send their customers privacy policy notifications only when the privacy policy is changed.  

Under current law, financial institutions must send these notices on an annual basis, regardless of whether the policy changes. The current requirement imposes a significant cost on credit unions and results in very little consumer benefit.  H.R. 601 has passed the House of Representatives on a number of occasions, most recently in April 2015, by voice vote.  

Permitting Privately Insured Credit Unions to Join the Federal Home Loan Bank System

Section 82001 is based on bipartisan legislation (H.R. 299), introduced by Representatives Steve Stivers (R-OH) and Joyce Beatty (D-OH).  This provision would correct a drafting oversight in the Federal Home Loan Bank Act that has resulted in a small number of privately insured credit unions being ineligible to join a Federal Home Loan Bank (FHLB)

Unfortunately, it has meant for over two decades, a small group of credit unions have been denied the right to even apply for membership in the FHLB System. The House of Representatives has continuously recognized this as a problem.  In 2004, 2006, 2014 and, most recently, in April of this year, the full House passed corrective legislation.  

It is long past time for these sections to become law, and we appreciate their inclusion in this must-pass legislation.