National Defense Authorization Act

Our Position

DCUC opposes legislation that would give banks the same access to leases on military bases that credit unions currently have. DCUC continues to urge the House and Senate Armed Services Committees to reject the inclusion of any language that would go beyond the Department of Defense’s current authority as it relates to exemptions from the costs of on-base leases, utilities, and services.

 

Background

After years of negotiation with the Department of Defense and through amendment of the Federal Credit Union Act in 1996, Credit Unions - at the discretion of the base commander - may be exempted from the costs associated with leases, utilities, and ATM placement on military installations.

This exemption is limited to credit unions if at least 95 percent of the membership to be served by the allotment of space or the facility built on the lease land is composed of individuals who are, or who were at the time of admission into the credit union, military personnel or federal employees, or members of their families. This exemption is not guaranteed for every credit union on every military base.  It is a negotiation between the base commander and that specific credit union.

Banks already have the ability via 10 USC §2667 to obtain the same type of waiver for rent.  However, banks have not exercised this clause.

Unlike commercial and community banks, savings from this discretionary waiver are directly passed on to the members and their military communities as there are no third-party dividends limiting this support.

Credit Unions would be extraordinarily concerned with the inclusion of any language that would provide rent free access to military institutions for more complex profit-centered entities such as predatory payday lenders and currently restricted insurance and investment companies.

 

In the News

Credit Union Times, June 11, 2019

Banks, Credit Unions Fight Again Over Free Rent on Military Bases


Credit Union Times, June 13, 2019

Fight Over Rent-Free Credit Union, Bank Access to Military Bases Takes New Turn

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