HOUSE BILL REPORT

HB 146

BYRepresentatives Lux, Winsley, Nutley, Chandler, Day, P. King, Dellwo and Zellinsky

Revising provisions relating to credit unions.

House Committe on Financial Institutions & Insurance

Majority Report:     Do pass.  (14)

     Signed by Representatives Lux, Chair; Zellinsky, Vice Chair; Betrozoff, Chandler, Crane, Day, Dellwo, Ferguson, P. King, Meyers, Niemi, Nutley, Silver and Winsley.

House Staff:John Conniff (786-7119)

AS PASSED HOUSE FEBRUARY 6, 1987

BACKGROUND:

In 1984, the legislature rewrote the credit union code.  Among the changes were the following: a provision updating the grant of authority to Washington State credit unions to engage in lending and investment activities that the federal government allowed federally chartered credit unions; a provision requiring credit unions to hold annual meetings within ninety days of the end of the fiscal year; a provision limiting personal loans to a term of no greater than twelve years if not secured by real estate and to a term no greater than fifteen years if secured by real estate; a provision limiting mobile home loans to a term of not greater than twenty years; and a provision requiring that any account a credit union had in another financial institution not exceed the amount insured by the federal government.

SUMMARY:

Several changes are made to the 1984 credit union code revision.  The provisions granting state chartered credit unions the authority to engage in activities permitted federal credit unions is updated to permit the exercise of any activity permitted federal credit unions as of the date of passage of this bill.

Credit unions are no longer required to meet within ninety days of the end of the fiscal year but must meet at least annually.

Credit union members may not vote by mail on issues presented at a special meeting unless the issue concerns the merger of the credit union.

The treasurer of the credit union does not have to be a member of the board of directors of the credit union.

Credit unions are granted a lien on the account(s) of any member who owes the credit union money.

The loan maturity time limits for personal loans and mobile home loans are repealed.

The requirement that credit union accounts with other financial institutions be fully insured is repealed.

Credit union authority to make loans to organizations owned by the credit union is increased to an additional one percent of the credit union's total paid-in and unimpaired capital and surplus.

Fiscal Note:    Not Requested.

House Committee ‑ Testified For:     Gary Oakland, Boeing Credit Union; and Jim Byrne, Washington Credit Union League.

House Committee - Testified Against: None Presented.

House Committee - Testimony For:     The amendments to the credit union code are necessary technical changes to reflect changes in credit union operations, and new products.  In addition, some changes are made to correct drafting errors made when the code was revised.

House Committee - Testimony Against: None Presented.