Legislative & Advocacy Update

Interchange continues to pop up in state legislatures; so far credit union advocacy efforts are keeping the bills from moving forward. 

The House is in session while the Senate begins a two-week recess; however, lawmakers and the Biden Administration are focused on an agreement to avert defaulting on debt; Senate Leadership told members to be ready to return to Washington, D.C., should they need to vote on a deal.

Treasury Secretary Janet Yellen anticipates reaching the limit next Thursday. Discussions on raising the debt ceiling among a group of negotiators were set to continue over the weekend, but broke down. President Joe Biden and House Speaker Kevin McCarthy, R-Calif., are scheduled to meet again early this week to find a working solution. McCarthy had previously said he hopes to vote on a measure this week. If a compromised is reached, it’s likely to take about a week and a half to get it passed through both chambers. 

This past week, the ICBA hosted their annual fly-in to Capitol Hill. The CUNA League system credit unions shared credit union priorities with lawmakers and their staff in advance of their arrival, highlighting where we work together with banks while proactively countering banker attacks against credit unions. CUNA and the Leagues have followed up with lawmakers on Friday, addressing issues raised by bankers and highlighting the credit union tax status and positive impact, along with our priorities.
 
Also last week a House Financial Services Committee and Senate hearings featured federal financial regulators – including NCUA Board Chair Todd Harper. The need for credit union parity with banks in any potential deposit insurance reform legislation was addressed both in the hearing and in advance with a letter to congressional leaders. Members also directed questions about the exclusion of privately insured credit unions from the Bank Term Funding Program. Credit unions’ financial focus received some positive attention this past week.
 
Interchange 
While a federal bill on interchange isn’t introduced yet, we are seeing the issue pop up in state legislatures. The Cornerstone League aggressively challenged the Texas interchange bill with an action alert, sending more than 900 letters in opposition, and the bill was not considered by committee before the deadline. This follows several other states where lawmakers introduced interchange bills that did not move forward due to credit union advocacy efforts.
 
Elsewhere on the Hill, the House Financial Services Committee will hold a markup of several bills Wednesday, including the Increasing Financial Regulatory Accountability and Transparency Act and the Middle Class Borrower Protection Act of 2023. In addition, the NCUA Board meets Thursday and is set to issue a proposed rule related to charitable donation accounts.

Also happening this week:

• Federal Housing Finance Agency (FHFA) Director Sandra Thompson will testify before the House Financial Services Committee.
• A House Ways and Means subcommittee will discuss ways to combat identity fraud, specifically the role of the Social Security Administration in these efforts.
• A House Oversight subcommittee will hold a hearing on recent bank failures and the San Francisco Federal Reserve.
• The House Small Business Committee will discuss ways to support veteran-owned small businesses.
• A House Financial Services subcommittee will hold a hearing to discuss international financial institutions.

​Please don’t hesitate to contact either Jeff Olson or Amy Kleinschmit with any advocacy questions.