Message from the CEO - Credit Unions: It's Time to Pay Their Fair Share

posted 3/3/2014 in CEO Messages

Credit Unions: It’s Time to Pay Their Fair Share

Erik Skovgard, CEO, Lincoln Savings BankThousands of Credit Union employees and their supporters were in Washington, DC recently visiting their lawmakers on Capitol Hill.  They were there to appeal to lawmakers to continue with the outdated tax exempt status that has enabled Credit Unions an unfair competitive advantage and robbed the communities they serve of valuable tax dollars.

Here are the facts:

  • The federal office of Management and Budget recently estimated the credit union tax exemption at almost $10 billion over the next 5 years and $20.5 billion in lost revenue since 2001.
  • An Iowa family of four pays more federal income tax than the entire credit union industry.
  • Iowa’s three largest credit unions’ net income equaled $74 million in 2013, accounting for 85 percent of total industry profits in Iowa.
  • Since 2007, 71 percent of new credit union branches were located in counties where the median income was higher than the Iowa average.
  • Iowa’s two largest state-chartered credit unions have over $2 billion in assets, while the average size of an Iowa state-chartered bank is about $200 million.
  • The most profitable financial institution chartered in Iowa is a credit union.

Do you think Iowa communities could benefit from tens of millions of tax dollars?? The credit unions have long outgrown their original purpose of serving the underserved, so I think it’s time to right this wrong.? If you agree, I encourage you to help.? Write Congress to let them know it’s time for credit unions to pay their fair share, or Tweet your Congressman with #itstime2pay.? Thanks for your support!

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