Newsroom

Back to the Newsroom
June 01, 2021

In Budget Proposal, Biden Outlines Spending and Revenue Vision; NAFCU To Fight Reporting Requirement for Credit Unions

President Joe Biden on Friday released the details of his administration’s proposed budget for fiscal year 2022. The $6 trillion budget proposes to increase federal spending in areas ranging from housing, education, health care, and infrastructure. Of note for credit unions, the proposal would boost funding for the Small Business Administration (SBA) and Community Development Financial Institution (CDFI) Fund compared to the 2021 enacted levels. The proposed budget seeks various ways to raise revenues to pay for this spending, including increase the corporate tax rate to 28 percent from 21 percent, raise the individual tax rate for high-income earners to 39.6 percent, as well as increase IRS audits and requiring financial institutions to comply with additional reporting requirements on accounts.

Under the new reporting requirements, financial institutions would be required to file an annual information return for all business and personal accounts with more than $600 in their account. The annual reporting requirement would include information related to gross inflows and outflows, including the amount of cash, transfers to and from accounts held by the same owner, and transactions with foreign accounts.

Last month, NAFCU and several other financial services industry trades to raise concerns about the proposed tax reporting requirement. NAFCU and the trades said proposals "to create new reporting requirements for financial institutions would impose cost and complexity that are not justified by the potential, and highly uncertain, benefits. Furthermore, we believe additional reporting requirements guided by subjective criteria have privacy and fairness implications and the potential to put financial institutions in an untenable position with their account holders." NAFCU will continue to inform policymakers of the burden of this requirements on credit unions and their members and recommend they instead provide the IRS with additional resources needed to conduct effective and efficient audits.

Other items included in the President’s budget include:

CDFI Fund

The proposal provides $330 million to the Treasury's CDFI Fund – an increase of 22.2 percent from the 2021 enacted level (excluding coronavirus-related emergency funding). NAFCU had called for additional CDFI support, including CDRLF, during last year's funding negotiations.

The CDFI funding is cited as supporting opportunities for minority-owned businesses, affordable housing development, and community revitalization projects.

NAFCU consistently advocates for full funding for the CDFI Fund as there are hundreds of CDFI-certified credit unions across the country that work to meet the needs of low-income, minority, and underserved communities. During a meeting earlier this year, NAFCU and member credit unions met with the NCUA on its new Advancing Communities through Credit, Education, Stability and Support (ACCESS) initiative and the value of CDFI designations. 

Housing

The budget request also includes several provisions to expand housing opportunities and reduce the racial wealth gap. Some of the funding would go toward supporting access to homeownership for underserved borrowers through the Federal Housing Administration's (FHA) mortgage insurance programs, as well as supporting coronavirus-related relief provided to homeowners facing financial hardships.

It also proposes $800 million in new investments across Department of Housing and Urban Development (HUD) programs for rehabilitation and modernization to further climate resilience and energy efficiency – aimed at addressing climate change impacts, such as increasingly frequent and severe floods.

Explore the complete budget request here. NAFCU will continue to advocate for funding for agencies and programs that allow credit unions to meet members' needs and support their communities.

Related Resources

Add to Calendar 2024-04-25 14:00:00 2024-04-25 14:00:00 ChatGPT: What AI can do for you! ChatGPT has been created with one main objective – to predict the next word in a sentence, based on what's typically happened in the gigabytes of text data that it's been trained on. Did you ever hear of the saying, “People fear the unknown?” Artificial intelligence scares people, but it is the future, and you need to understand the tools and resources it offers. It’s also about saving time, that’s what technology and in this case, artificial intelligence can do for you.  If you want to save time and have a better quality of life, this training is for you. Once you give ChatGPT a question or prompt, it passes through the AI model and the chatbot produces a response based on the information you've given and how that fits into its vast amount of training data. It's during this training that ChatGPT has learned what word, or sequence of words, typically follows the last one in a given context. During this webinar, ChatGPT: What AI can do for you, you’ll discover the background, purpose, usability, and the pros and cons. Don't miss this opportunity! Key Takeaways Learn the background of AI Understand the purpose of AI Identify the pros and cons    Register Now $295 Members | $395 Nonmembers(Additional $50 for USB)One registration gives your entire team access to the live webinar and on-demand recording until April 25, 2025Go to the Online Training Center to access the webinar after purchase »   Who Should Attend NCRMs Risk titles Education Credits NCRMs will recieve 1.0 CEUs for participating in this webinar Web NAFCU digital@nafcu.org America/New_York public

ChatGPT: What AI can do for you!

Credits: NCRM

Webinar
Add to Calendar 2024-04-25 14:00:00 2024-04-25 14:00:00 Unifying Two Different Executive Benefits Programs About the Webinar In part one we discussed how to retain key positions during a time of transition. In part two, we will look at how to combine executive benefits programs from two different organizations into a single high-performing program. Evaluating each program includes many different facets, from strategy and expense to performance and servicing. This session will provide important considerations, whether or not you have pending M&A activity.  Key Takeaways: Is the plan design both retentive and efficient?  Is the benefit expense properly mitigated?  Does the legal agreement reflect the board’s intent?  View On-Demand Web NAFCU digital@nafcu.org America/New_York public

Unifying Two Different Executive Benefits Programs

preferred partner
Gallagher
Webinar
Add to Calendar 2024-04-24 14:00:00 2024-04-24 14:00:00 Optimize Liquidity, Maximize Loan Growth: The Network Lending Advantage About The Webinar Join us to learn more about network lending, a cooperative model allowing credit unions to optimize liquidity and achieve loan growth. Discover how credit unions can participate in loan pools with other institutions, allowing them to diversify portfolios, access loans with potentially lower risk and higher yields, and expand lending capacity without necessarily needing a surge in deposits. Delve into how credit unions can pool their resources, set common underwriting and pricing standards, and collectively originate, buy, and sell loans to optimize liquidity management. Hear from your peers about best practices, case studies, and practical strategies to harness the full potential of network lending and how it's helped their credit unions. Don't miss this valuable opportunity to learn how to strengthen your credit union's position in today’s competitive environment.  Key Takeaways: How network lending differs from traditional lending  The benefits of participating in loan pools with other credit unions  How credit unions can set common underwriting and pricing standards and collectively originate, buy and sell loans to optimize liquidity management  Why network lending is critical to loan growth  Watch On-Demand Web NAFCU digital@nafcu.org America/New_York public

Optimize Liquidity, Maximize Loan Growth: The Network Lending Advantage

preferred partner
LendKey
Webinar
Add to Calendar 2024-04-23 14:00:00 2024-04-23 14:00:00 Monitoring the Latest Litigation Risks Credit unions’ operations pose litigation risks, with more of these cases being filed as class action lawsuits. In this Monitoring the Latest Litigation Risks for Credit Unions webinar, you’ll review some of the specific kinds of lawsuits impacting credit unions and what potential claims could be on the horizon. You’ll also examine some options for mitigating risks. Key Takeaways Review the current lawsuit trends. Understand the potential claims risks Explore options for mitigating risks.   Register Now $295 Members | $395 Nonmembers(Additional $50 for USB)One registration gives your entire team access to the live webinar and on-demand recording until April 23, 2025Go to the Online Training Center to access the webinar after purchase »   Who Should Attend NCCOs NCRMs Compliance and risk titles Education Credits NCRMs will recieve 1.0 CEUs for participating in this webinar NCCOs will recieve 1.0 CEUs for participating in this webinar Web NAFCU digital@nafcu.org America/New_York public

Monitoring the Latest Litigation Risks

Credits: NCCO, NCRM

Webinar