SCS HS HCS HB 1323 -- CREDIT UNIONS

This bill makes several revisions to credit union provisions.
Credit unions are permitted to continue to include all persons,
groups, and geographic areas that were included or applied for
as of April 1, 1998.  The bill:

(1)  Creates the Credit Union Commission to approve proposed
regulations, determine appeals, and advise the Director of the
Division of Credit Unions on credit union matters;

(2)  Outlines a process by which to appeal any order or decision
of the director;

(3)  Removes the limitation of large and small membership groups
and allows credit unions to be composed of one or more groups of
persons;

(4)  Adds common employer to current membership requirement of
common occupation or association;

(5)  Allows persons who reside or work in a well-defined local
neighborhood, community, or rural district to join a credit
union.  Current law limits membership to groups residing within
a well-defined neighborhood, community, or rural district;

(6)  Prohibits eligibility for membership based upon a person's
relationship to another person, except members of the immediate
family or household;

(7)  Allows members to remain members until they voluntarily
withdraw from the credit union;

(8)  Subjects state chartered credit unions to membership
limitations no less restrictive than federal laws and
regulations for federally chartered credit unions;

(9)  Creates guidelines for the membership group size in the
absence of federal laws or regulations, including groups that
cannot establish a new single common-bond credit union and
groups that have been transferred as a result of an approved
merger or consolidation;

(10)  Permits the director to allow a credit union to include
any person within a neighborhood or community if the area is a
low-income or underserved community or if a community chartered
credit union participates in a merger or consolidation; and

(11)  Establishes a procedure for including new groups or
geographic areas in a credit union, with an appeals process.

HS HCS HB 1323 -- CREDIT UNIONS (Green)

This substitute creates the Credit Union Commission in the
Division of Credit Unions.  The commission is authorized to
approve or disapprove regulations proposed by the director of
the division, hear and determine appeals of the director's
orders, and advise the director on matters related to credit
unions.  The substitute also outlines the process for appealing
the director's orders.

Currently, credit union membership is limited to large and small
groups having a common bond of occupation or association or to
groups residing within a well-defined neighborhood or
community.  The substitute requires a credit union to be
composed of one or more groups that share a common occupation,
association, employer or interest, or reside or work in a well--
defined neighborhood or community.

Credit unions are authorized to add to their membership groups
or geographical areas so long as the credit union meets certain
criteria.  Credit unions may continue to include in their fields
of membership all persons, groups, and geographical areas
included as of March 1, 1998.

FISCAL NOTE:  Estimated Net Cost to Credit Union Fund of $13,385
in FY 1999, $16,791 in FY 2000, and $17,126 in FY 2001.

HCS HB 1323 -- MEMBERSHIP OF CREDIT UNIONS

SPONSORS:  McLuckie (Green)

COMMITTEE ACTION:  Voted "do pass" by the Committee on Consumer
Protection by a vote of 11 to 4 with 1 present.

This substitute authorizes the Director of the Division of
Credit Unions to approve amendments to bylaws regarding credit
union membership or to organize credit unions that include
single or multiple groups.

The substitute also changes credit union membership
requirements.  Currently, credit union membership is limited to
large and small groups having a common bond of occupation or
association or to groups residing within a well-defined
neighborhood or community.  The substitute requires a credit
union to be composed of one or more groups that share a common
occupation, association, employer or interest, or reside or work
in a well-defined neighborhood or community.

FISCAL NOTE:  No impact on state funds.

PROPONENTS:  Supporters say that credit unions should be allowed
to serve consumers such as small companies that may not be able
to offer expensive benefits such as retirement and healthcare.
They say that credit union membership is a free service small
companies can provide to their employees.

Testifying for the bill were Representative Green; Missouri
State Credit Union; Federal Employees Credit Union; Jim Murphy,
small business owner; and St. Louis Community Credit Union.

OPPONENTS:  Opponents say that credit unions are taking members
outside of their statute-defined field of membership and that
this causes unfair competition with banks.  They say that banks
are more regulated and that the taxes they pay are a huge cost
of doing business.

Testifying against the bill were Missouri Bankers Association;
Missouri Independent Bankers Association; and Missouri League of
Financial Institutions.

Donna Schlosser, Legislative Analyst

HB 1323 -- Credit Union Membership

Sponsor:  Green

This bill authorizes the Director of the Division of Credit
Unions to approve applications to amend bylaws governing credit
union membership or to organize credit unions that include
single or multiple groups.

This bill also removes the membership limitation requiring
groups to have a common occupation or association or to reside
within a well-defined community or rural district.