Legislative Update with Kenley

Credit unions showed up strong at Legislative Day as key bills advanced and new interchange concerns emerged.

By Kenley Lamberty, DakCU Director of Political Strategy and Engagement

Dear Credit Union Friends and Advocates,
​
A huge thank you to everyone who joined us in Pierre on February 11 for SD Credit Union Legislative Day! Your presence, energy, and dedication made the day truly impactful and helped strengthen our collective voice at the Capitol.
 
We were proud to have representatives in attendance from:

• Black Hills FCU
• Bluestone FCU
• Oahe FCU
• Dakota Rail Line FCU
• East River FCU
• Norstar FCU
• Service First FCU
• Voyage FCU
• Sioux Valley FCU
• Healthcare Plus FCU
• Dakotaland FCU
• M-O FCU
• Levo FCU
• Explorers FCU
• Northern Hills FCU

 
Your engagement demonstrates the strong commitment our South Dakota credit unions share when it comes to advocacy and protecting the cooperative model.
 
Special appreciation goes to all of you who:
•  Attended the GAC meeting
•  Participated in the group photo and lobby networking
•  Joined us for introductions on the House and Senate floors
•  Engaged in the insightful panel discussion on data centers and other critical issues

We were thrilled to welcome credit union professionals from across the state and to host our distinguished panelists Senator Steve Kolbeck, Senator Sydney Davis, Senator Casey Crabtree, and Representative Kent Roe for such a thoughtful and timely conversation.

None of our advocacy efforts would be possible without your support, time, and commitment. Showing up in person to connect directly with lawmakers, share our members’ stories, and highlight the vital role credit unions play in our communities makes a real difference. Thank you for helping us amplify those messages during this 101st Legislative Session.

​We continue to actively track key bills on your behalf, including:
•  Senate Bill (SB) 150 (motor vehicle equity exemption) – now headed to the Senate floor
•  SB 98 (cryptocurrency kiosk safeguards) – advanced with strong fraud protections
•  House Bill (HB) 1248 (UCC revisions) – we remain opposed due to significant operational concerns
•  HB 1238 – we strongly support this important protection for vulnerable members

We’ll keep you updated as these and other priority bills move forward. Your involvement last week has already helped build stronger relationships and greater awareness among our elected officials.

To see full list of bills we are tracking CLICK HERE.

If you have questions about these or any other bills please feel free to reach out.
 
Update on Illinois Interchange Fee Prohibition Act (IFPA)
Following last week’s ruling by the U.S. District Court for the Northern District of Illinois, which largely upheld the Illinois Interchange Fee Prohibition Act (IFPA), America’s Credit Unions, the Illinois Credit Union League, and co-plaintiffs (including the American Bankers Association and Illinois Bankers Association) filed an appeal on Friday with the U.S. Court of Appeals for the Seventh Circuit.

The IFPA, originally set to take effect July 1, 2025 but delayed to July 1, 2026, would prohibit financial institutions including credit unions payment networks, and other entities from charging or receiving interchange fees on the portion of debit or credit card transactions attributable to taxes or gratuities (tips), provided the merchant discloses those amounts to the acquiring bank.

In the district court decision (issued around February 10-11, 2026), Chief Judge Virginia Kendall granted partial relief: the court upheld federal preemption for the law’s data usage provisions (barring certain sharing or use of transaction data beyond processing needs), providing protection for banks, savings associations, out-of-state state-chartered banks, and federal credit unions in that area. However, the judge denied preemption for the core interchange fee ban, ruling that it does not conflict with federal law in the same way.

This split outcome creates significant compliance challenges for credit unions operating in or serving members in Illinois, as the interchange restrictions would require complex transaction-level adjustments starting July 1, potentially disrupting payment flows, increasing costs, and affecting revenue on tipped or taxed transactions.
 
​Stay Connected
For more information or to share your perspectives, feel free to contact me. ​