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Rent-Free Debate is Back Again for Credit Unions (CU Times, June 23, 2020)

Tuesday, June 23, 2020  
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Language included in the 2021 National Defense Authorization Act allows banks, like CUs, to exist rent-free on military bases.

Six months after winning the argument, credit union trade groups are arguing again with lawmakers to keep banks from operating on military bases rent-free.

On Monday, the Defense Credit Union Council (DCUC), NAFCU and CUNA sent a letter to Senate Majority Leader Mitch McConnell (R-Ky.) and Minority Leader Chuck Schumer (D-N.Y.) opposing the inclusion of the rent-free provision in the 2021 National Defense Authorization Act (NDAA).

According to the letter, “Our organizations recognize the important role both credit unions and banks can play for our men and women in the military in the provision of traditional financial services and in protecting our troops from predatory lenders. However, we remain concerned that this effort in the FY2021 NDAA to tie the fate of banks on the lease issue to credit unions could ultimately disadvantage credit unions and the men and women of our nation’s armed services that they serve.”

 

Screenshot of letter sent to Senate leaders. Screenshot of a portion of the first page of the letter sent to Senate leaders.

 

In December, credit union groups were able to exclude similar language that was included in the fiscal year 2020 defense authorization bill.

Credit union officials admit, although it’s early in the negotiations for the 2021 NDAA and they have not seen the official markup of the Senate Armed Services Committee’s version of the bill, they have seen the rent-free inclusion for banks in the summary package of the bill.

According to the letter, “We are concerned that this language in the NDAA could essentially require that the DoD treat large mega-banks, such as Wells Fargo, the same as a military installation’s local not-for-profit defense credit union when it comes to rent on military bases.”

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