President’s Point – NDAA
The issue of credit unions receiving rent-free leases on military bases has been a hot-button for banks for years. The banks don’t like it, and they are actively lobbying for a change in regulations so that they can have similar access to these military installations.
With so many military bases in Florida and Alabama, the LSCU has closely followed this battle, and I have added my signature, joining other League presidents and CUNA, to a letter sent to members of the Senate Armed Services Committee. The objective is to get our message to decision makers ahead of the Fiscal Year 2020 National Defense Authorization Act (NDAA) Conference.
In the letter, we explain that the exemption is not guaranteed for every credit union but instead is negotiated between the base commander and the credit union. We also emphasize the inherent differences between the credit union mission and structure and the profit-driven model that banks operate under.
It is because credit unions are not-for profit cooperatives and their mission to provide consumer friendly products and services to our nation’s service men and women that they receive rent-free leases on bases. The letter explains: “The CUNA/League System and our credit union members are extremely concerned over Section 2821 of the Senate-passed NDAA that would provide rent-free access to military installations for more complex, profit-centered financial institutions. The House-passed NDAA contains no similar language. As conference negotiations begin, we urge all conferees to reject the inclusion of Section 2821.”
The House Armed Services Committee concluded its mark-up of the National Defense Authorization Act (NDAA) back on June 13. Prior to the mark-up, concern existed that Rep. Trent Kelly (R-MS) planned to offer an amendment to the NDAA that would give this military base parity to banks.
As soon as word circulated that this amendment was filed, the LSCU advocacy team contacted its five members of the committee, Reps. Mo Brooks (R-AL), Bradley Byrne (R-AL), Matt Gaetz (R-FL), Mike Rogers (R-AL), and Michael Waltz (R-FL) requesting opposition to this amendment. Due to pressure from the credit union industry, the amendment was never officially offered, and the NDAA passed committee without this language.
When Congress returns in September, they will begin formally conferencing the NDAA FY 2020 bill. We have again sent our message that credit unions can better serve our military through lower rates, better products, and more responsive services. You can find the full letter here, and we will keep you updated on the issue. I would urge credit unions concerned about this proposed change to join the League for our Hike The Hill to Washington, D.C., scheduled for Oct. 22-23.