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	Rep. Shelley Moore Capito says CUs face a "troublesome" regulatory environment. -Tkatch photos

Sept. 22, 2011 – A hearing on credit unions' member business lending authority will be held "sometime in October" by the House Subcommittee on Financial Institutions and Consumer Credit, Rep. Shelley Moore Capito, R-W.Va., announced Wednesday during NAFCU's Congressional Caucus in Washington.

Capito, who chairs the subcommittee, described the regulatory regime that credit unions are currently up against as "very troublesome." She singled out the Consumer Financial Protection Bureau as unnecessary for credit unions since they have always looked out for consumers' best interests. "Consumer protection is as important to you as safety and soundness," she said.

While noting the subcommittee's intention to tackle MBL, Capito did not indicate whether she would back H.R. 1418, a bill that would lift credit unions' MBL cap from 12.25 percent of total assets to 27.5 percent.

Rep. Ed Royce said increase in MBL cap could lead to creation of 140,000 new jobs.

The bill's chief sponsor is Rep. Ed Royce, R-Calif., and Royce told Caucus participants his bill, introduced with Rep. Carolyn McCarthy, D-N.Y., as its chief Democratic cosponsor, would help infuse an estimated $13 billion into the economy and create 140,000 new jobs. That would "continue to spur economic growth, job creation," he said.

Rep. Debbie Wasserman Schultz, D-Fla., said credit unions have played an important function, lending to small business "when many entrepreneurs had difficulty dealing with their banks." She said credit union MBL activity has helped create 6,600 new jobs in Florida over the past year and 146,000 nationwide.

H.R. 1418, which has garnered increased support and attention during NAFCU's Congressional Caucus, would establish certain eligibility requirements. A credit union would have to be classified as well-capitalized, be near its current cap, have at least five years' experience with MBLs and satisfy other safety-and-soundness requirements to be implemented by NCUA. The bill now has 69 cosponsors, while the Senate version has 20 cosponsors on record.

Rep. Gregory Meeks pointed to the jobs creation possible from more CU business lending.

Rep. Gregory Meeks, D-N.Y., a member of the House Financial Services Committee and a cosponsor of H.R. 1418, touted the impact the bill would have on job creation. By some estimates, it would result in 100,000 new U.S. jobs, he noted. "It's something we should all rally around. It is time for us to remove the handcuffs," he said.

Also speaking at Caucus yesterday was freshman Rep. Michael Grimm, R-N.Y. Also a member of House Financial Services, Grimm said Congress needs to take a close look at "regulations that sound good in theory but do not work in practical application." However, any serious regulatory reform is unlikely to become law before the 2012 election season, he said.

Grimm drew cheers when he touted his support for the credit union tax exemption and pledged that he will not allow its elimination. "I see the value you provide to your communities," he told attendees. "The last thing I want you to do is turn away deposits."