Despite bipartisan rejection last session, credit unions are once again asking the General Assembly for the authority to hold public deposits – your tax dollars at the state and local levels. Instead of a bill, they are attempting to change this policy by amending the Commonwealth’s budget.
Outreach to members on the House Appropriations Committee is especially important as they will determine whether the amendment will be included in the House budget early next month. The list of that Committee’s members can be found <a href="https://lis.virginia.gov/session-details/20251/committee-information/H02/committee-details" target="_self">here</a>, but raising awareness and opposition to all members is critical.
Please take a moment to review the impact of this budget amendment by reading these talking points <a href="https://nam02.safelinks.protection.outlook.com/?url=https%3A%2F%2Fwww.canva.com%2Fdesign%2FDAGceK1YLKY%2Fiyx2WaFwJ3728kMlGl-CzA%2Fview%3Futm_content%3DDAGceK1YLKY%26utm_campaign%3Ddesignshare%26utm_medium%3Dlink2%26utm_source%3Duniquelinks%26utlId%3Dh835e57b77c&data=05%7C02%7Cgbond%40vabankers.org%7C450f01d9f2b346bc302408dd37254038%7C2951dbdd8197417abf7329edc9a082c5%7C0%7C0%7C638727355308527924%7CUnknown%7CTWFpbGZsb3d8eyJFbXB0eU1hcGkiOnRydWUsIlYiOiIwLjAuMDAwMCIsIlAiOiJXaW4zMiIsIkFOIjoiTWFpbCIsIldUIjoyfQ%3D%3D%7C0%7C%7C%7C&sdata=OrNyrfxg4wyr5artTGI2TzXsSa4qBbJVODOd839TAoE%3D&reserved=0" target="_self">here</a>.&nbsp;&nbsp;&nbsp;
Thank you,
Virginia Bankers Association

Reject Credit Union Public Deposit Amendment - Item 261 #1h

As your constituent and an active Virginia banker, I strongly request you to reject proposed budget language that allows credit unions to hold state and local tax dollars in the form of public deposits. This policy, which has not been requested by local or state treasurers, is an unnecessary and harmful proposal that would drain local tax dollars, hurt community banks and their employees, and potentially destabilize Virginia’s AAA bond rating. Similar legislation last session was defeated in a bipartisan manner after significant debate and discussion. Rejected through the normal legislative process, the credit unions are now attempting to insert this misguided policy in the Commonwealth’s budget through an amendment (Item 261 #1h) offered by Delegate Sewell.

It defies reason that credit unions, which do not pay state business taxes, would be allowed to benefit from holding state and local tax dollars. As credit unions do not pay the bank franchise tax, like my bank does, every dollar they siphon from banks is a direct depletion of state and local resources. 

Most localities in Virginia deposit their funds in Virginia-based banks, a majority of which are community banks. While paying taxes based on those deposits, we, as bankers, put that money back to work in our communities, lending to small businesses and homeowners, and investing in low-income and minority communities at and beyond Federal regulatory requirements.  

Unlike banks, credit unions do not have any requirements to reinvest in low- and moderate-income communities in Virginia. Credit unions have no legal responsibility to use deposits in the communities from which they come for reinvestment purposes. A decision to remove public deposits from banks and move those dollars to differently regulated, untaxed credit unions could result in less investments in low-income citizens and businesses in my community. 

Please support my industry, my job, and the localities in your district by rejecting efforts to give credit unions the authority to hold public deposits.

Reject Credit Union Public Deposit Amendment - Item 261 #1h

Message

Dear Office Holder (names will be automatically added on each email),