For more information, contact Eric Skrum
608-441-1216 or eskrum@wisbank.com
Taxpayers demand accountability for expensive subsidy to profit-driven institutions
(MADISON, WI) – Tax exempt credit unions should expand their outreach to underserved populations rather than asking Congress for additional advantages over their taxpaying competitors, according to the Wisconsin Bankers Association (WBA).
Multiple studies, including ones from the Government Accountability Office (GAO) – the research arm of Congress – and the National Community Reinvestment Coalition (NCRC), have documented that taxpaying banks do a far better job of reaching underserved consumers than credit unions, despite the credit union subsidy that costs Wisconsin taxpayers at least $40 million and at least $2 billion nationally.
But now the credit union lobby is pushing Congress to expand the already broad commercial lending authority for the largest, most profit-driven credit unions.
“It doesn’t make sense for federal lawmakers to reward billion dollar credit unions with more commercial lending authority when there is overwhelming evidence from independent and unbiased sources that CUs are not reaching out to underserved consumers,” explained Kurt R. Bauer, WBA president/CEO.
Given the state and federal budget imbalances, Bauer also said it doesn’t make sense to give a tax exempt industry more advantages at the expense of taxpaying ones.
“If you surveyed taxpayers on the fact that credit unions score below banks in serving lower income consumers and that even the largest don’t pay a dime of state or federal corporate income tax, I wonder how high the percentage demanding change would be,” said Bauer.
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The Wisconsin Bankers Association is the state’s largest financial industry trade association, representing 300 commercial banks and savings institutions, their nearly 2,300 branch offices and 28,000 employees.
