Community Bank Petition to Congress
Oppose H.R. 1418 and S. 2231
We, the undersigned community bank Chief Executive Officers, Presidents, Directors, employees, business partners and customers do hereby submit this petition to urge opposition to H.R. 1418/S. 2231, the Small Business Lending and Enhancement Act of 2011, which would significantly increase the member business lending authority of tax-exempt credit unions.
The current business lending cap of 12.25% of assets was set in law by Congress to maintain a distinction between tax-exempt credit unions and taxpaying community banks. Any legislation to increase this cap would only harm and displace taxpaying community banks and the customers and communities they serve. Taxpaying community banks more than adequately satisfy all past, present, and future small business loan demand from qualified borrowers in their communities across the country.
We urge Congress not to expand the credit union industry’s entry into prohibited commercial lending unless credit unions are required to pay taxes and comply with the Community Reinvestment Act like community banks doing the same lending already do. The generous federal tax subsidy to credit unions of $30 billion over a 10-year period is directly linked to and can only be justified by their original mission of serving individuals of modest means. Any expansion of their powers beyond their original tax-exempt mission should result in the loss of their tax exempt status.
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