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DCUC, CUNA, NAFCU Send Joint Letter to Hill on Leases on Military Bases (CUToday, June 14, 2020)

Sunday, June 14, 2020  
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WASHINGTON—During markup last week of the National Defense Authorization Act (NDAA) for fiscal year 2021, a Senate summary of the Act reveals the banking industry is again seeking a provision that would require the Department of Defense to treat banks similar to credit unions when it comes to leases on military bases.


Anthony Hernandez

As has reported, the issue of bank access to on-base leases was hotly contested during passage of the NDAA for fiscal year 2020, with credit unions eventually defeating the bank effort in Congress. Similar to 2020, language in the Senate version of the NDAA would give banks access to leases on bases, while the House version lacks the provisions.

The Defense Credit Union Council (DCUC), CUNA and NAFCU have now issued a joint letter to the House Committee on Armed Services asking the House to counter the Senate’s proposed language.

The request follows a DCUC letter last week to the Senate Armed Services Committee asking the group to “strike any provisions that would alter the status quo” regarding free leases and other benefits credit unions currently receive on military bases.

DCUC President and CEO Anthony Hernandez told the proposed language in the Senate reflects the “same strategy the banks used last year.”

‘Countering’ the Threat

Now with a new threat again this year, Hernandez said, “It is important to counter this proposed language since it does not benefit military members and further enriches the bank shareholders. Banks should not be treated as not-for-profit institutions unless they act like not-for-profit institutions and return any savings to military members and their communities—just like credit unions. I am very proud to have both CUNA and NAFCU on our flank as we advocate for our members and the larger credit union industry.”

The joint letter from DCUC, CUNA, and NAFCU states, “While banks argue for ‘parity’ on this issue, the fact is that banks already have the ability to obtain leases at a nominal cost. Under the Military Leasing Act, 10 USC §2667, banks can demonstrate to DoD how they would use their lease to serve and provide value to the men and women of the base. However, banks have not exercised this authority.  Instead, they have opted to end-run DoD and go to Congress to get a handout under the guise that too many banks have had to leave military bases due to the cost of leases making military banking less profitable. Rather than seek a productive solution available to them under current law, they have opted to target their long-time nemesis credit unions in the process. We hope the House Armed Services Committee will recognize the banker’s games for what they are – a charade to once again attack member-owned credit unions – and reject this provision in the NDAA.”

The actual final language in the Senate bill is expected this week.

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