Before leaving Raleigh for their summer break, N.C. House members tried to provide North Carolina-chartered credit unions with significant new authority as part of an unrelated bill dealing with tax policy.
But N.C. senators voted 41-1 against concurring with the House’s rewrite of Senate Bill 595. Sen. Gale Adcock, D-Wake, was the only senator present who favored immediate passage.
The two chambers have been at odds on credit-union policy for a couple sessions. The House proposal was similar to a bill one getting pigeonholed in the Senate, after passing the House 85-25.
Another single-issue bill on the point, House Bill 187, has been languishing in the Senate this session after passing the House 101-11 back in March.
The House majority favors allowing credit unions to broaden their lines of business if the bill passes, and to enroll members from a bigger slice of the state’s population.
But the bill has drawn consistent opposition from the state’s banks.
The House approach would “give credit unions the ability to go from having one common bond to stitching multiple common bonds together and thereby be able to include anyone, anywhere in the world, and any business as a member,” Nathan Batts, lobbyist for the N.C. Bankers Association, said in a message to the group’s members.
“That monumental change — plus additional new powers — sought to give credit unions practically all the powers of banks, without taxing, supervising and regulating them like banks,” Batts said.
Some House members share that view. “We love our credit unions, we want them to be successful and provide the services, but if they want to become banks, they need to start paying some taxes,” said Rep. Deb Butler, D-New Hanover, who voted against both SB 595 and HB 187.
But the proposed changes have support in the House because many banks have downsized their branch networks in recent years, leaving many rural residents with reduced access to in-person services.
Rep. Keith Kidwell, R-Beaufort, cited a bank closure in his district as an example. Southern Bank this spring pulled the plug on its branch in Aurora, merging its services with a branch in New Bern, which is at least a 30-mile drive away.
Kidwell said many communities in his coastal district are banking deserts.
“If the corporate banks want to compete, put a footprint in there and compete,” Kidwell told fellow members of the House Finance committee as they debated the revised SB 595. “If not, let’s let the credit unions do it.”
