House Mistake Could Kill Rent Deal for Military Credit Unions, Banks (CU Times, June 27, 2018)
Wednesday, June 27, 2018
An error in drafting legislation could kill a fragile deal that would allow banks and credit unions to have branches on military bases without paying rent—a benefit that only credit unions now enjoy.
The deal would have settled a longstanding battle between financial institutions over a provision of federal law that currently allows military officials to offer free rent to credit unions if 95% of the members served by the branch are members of the military.
Banks have long sought that benefit.
This year, for the first time, military credit unions and banking groups agreed that banks would have the same benefits, according to Steven Lepper, president/CEO of the Association of Military Banks of America.
In drafting the bill, the House Legislative Counsel’s office said the benefit would be extended to insured depository institutions. However, the definition cited was one that covered banks instead of credit unions.
“The original version would have applied to both banks and credit unions,” said Anthony Hernandez, president of the Defense Credit Union Council. “Unfortunately, the House legislative counsel inadvertently limited its scope to banks when trying to define ‘depository institutions.’”
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