Announced yesterday, January 25th in a bold press release, Gov. Doug Burgum (photo right) is urging the National Credit Union Administration (NCUA) to remove language from its proposed 2022-2026 strategic plan that discourages credit unions from lending to farmers and ranchers.
Citing “climate related financial risks,” the draft plan assumes that changing weather patterns “will disproportionately affect farming communities” and suggests that “to remain resilient credit unions may need to consider adjustments” to their membership.
In a letter submitted Monday as public comment on the draft plan, Burgum noted that North Dakota’s 34 credit unions have 214,000 members and currently hold $748 million in agricultural loans, accounting for roughly one-quarter of their loan portfolios on average. Agriculture “should be viewed as an industry uniquely positioned to capture and store carbon,” he stated, warning that discouraging ag lending would be counterproductive to carbon reduction goals.
“Given our administration’s goal of North Dakota becoming a carbon neutral state by 2030, we appreciate NCUA’s concern about climate change,” Burgum wrote to the NCUA Board. “However, carbon neutrality can be achieved only through innovation, not regulation – and certainly not by limiting access to credit for agricultural operations with natural carbon storage capacity.”
“The plan’s proposed draft language under ‘Climate-Related Financial Risks’ is ill-conceived, politically motivated, anti-agriculture rhetoric that threatens to cause serious harm to the farmers and ranchers who form the backbone of rural America,” Burgum continued. “We strongly urge that it be stricken from the proposed draft or significantly revised to encourage agricultural lending.”
DakCU President/CEO Jeff Olson officially weighed in on the issue in Monday’s President’s Perspective, and says he appreciates Governor Burgum’s leadership and comments to the NCUA this week. “Dakota farmers are the answer to climate change, and plant-based agriculture enhances climate resiliency,” he stated. “This is something that our federal regulatory agency does not fully understand or refuses to acknowledge. Our credit unions have been supporting and advancing our rural economies for more than eighty years, and credit unions here and across the country should not be penalized for it. We need to continue to make investments in our farm and ranch producers; not divest them,” he added.
Doug Goehring, ND Department of Agriculture Commissioner, also issued a comment letter to NCUA this week, asking them to “remove three paragraphs in page 12 of the proposed draft Strategic Plan containing overbroad, ill-supported, and conclusory language that relates to highly conjectural climate-related potential financial risks.” Read the commissioner’s letter here.
Monday, January 24th was the deadline to submit public comment on the proposed strategic plan before the NCUA Board considers it for final adoption.
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