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NAFCU continues to defend credit unions and their federal tax exemption after Sen. Orrin Hatch, R-Utah, sent a letter to the NCUA questioning credit unions' field of membership rules and the industry's tax-exempt status.

NAFCU's defense of the industry in response to Hatch's questioning has been featured in American Banker,The Hill,Politico's Morning Money,Credit Union Journal,Credit Union Times and CUToday.

Hatch, in a letter to NCUA Chairman J. Mark McWatters Wednesday, outlined concerns that credit unions are evolving away from their original tax-exempt purpose and raising questions about recent changes to field of membership rules. Hatch noted that the tax exemption requires that the "government closely oversee the credit union industry to ensure that it continues to fulfill its intended purpose."

In response, NAFCU Executive Vice President of Government Affairs and General Counsel Carrie Hunt wrote to Hatch noting the "tremendous value" the credit union tax exemption provides to credit union members and the national economy. Hunt directed Hatch to an independent study NAFCU commissioned last year that found the credit union tax exemption provides a $16 billion per year benefit to the U.S. economy and allows credit unions to offer better loan and deposit rates to consumers.

Hunt also said NAFCU is confident that changes made to the NCUA's field-of-membership rules are well within the agency's legal authority and are in keeping with the Federal Credit Union Act. She highlighted that maintaining a strong, independent NCUA as the primary regulator for credit unions is one of the association's 2018 priorities.

Preserving the credit union tax exemption has been NAFCU's top priority, including throughout last year's tax reform efforts and well before. For example:

• a December Wall Street Journal article on credit unions' success at protecting their tax status reflected on NAFCU's past efforts;
• in August, the association met with Treasury Secretary Steven Mnuchin to discuss tax reform efforts;
• NAFCU President and CEO Dan Berger was invited on FOX Business to explain the importance of the exemption;
• in a 2017 op-ed to U.S. News & World Report, NAFCU Chief Economist and Vice President of Research Curt Long detailed the benefits of the tax exemption, pushing back on critics claiming the exemption is outdated; and
• NAFCU launched a grassroots effort last year calling on member credit unions to defend the industry's tax-exempt status at the local level as some in the banking industry called for its elimination.