ICUL Service Corporation
May 2012


Important News

State-chartered CUs reach cumulative total of $11 million in regulatory fee credits!

New board seated at Convention

Attendees "Get in the Game!" at League’s 82nd Annual Convention

Illinois Legislative Day provides new format, honors CU Champions

ICU Foundation provides first round of grants, scholarships for 2012

Program changes for Enhanced IIA GM Program

State-chartered CUs reach cumulative total of $11 million in regulatory fee credits!
At the same time Illinois state-chartered credit unions noticed a partial credit on their April 2012 first quarter regulatory fee invoice, the $11 million these credit unions have received in the aggregate is the real accomplishment of unprecedented legal action undertaken by the Illinois Credit Union League (ICUL) eight years ago.

Between an initial cash settlement of $6.2 million, the regulatory fee holidays or credits realized in four of the past 12 quarters totaling $2.7 million, and a rate reduction of $2.1 million in regulatory fees paid to the DFI since the settlement was reached, Illinois state-chartered credit unions to date have realized a cumulative benefit of approximately $11 million.

The latest regulatory fee credit was the result of the remaining FY2011 amount due to Illinois state-charters after they enjoyed a total holiday on their 2011 4th quarter regulatory fee that would otherwise have been paid this past January to the Illinois Division of Financial Institutions (DFI). The credit exceeded the total 2011 4th quarter billing to credit unions for regulatory fees, which meant state-chartered credit unions were entitled to, and received, a carry-forward credit applied toward Q1 2012 fees, for a grand total of $1.25 million in the aggregate.

These credits continue to occur because of legislation initiated by ICUL to implement the court-approved settlement of the regulatory fee case it filed against then Governor Rod Blagojevich in 2004, which was signed into law by Governor Patrick Quinn effective April 6, 2009 (as Public Act 95-1047).  Under the terms of the settlement, Illinois state-chartered credit unions received a cash payment from the State in June, 2009 (the aggregate amount paid to credit unions was approximately $6.2 million).  The payment represented a credit for the overpayment in regulatory fees made under the Blagojevich Administration’s fee escalation and transfer (“sweep”) budgetary arrangement adopted by the State in its fiscal years 2004 through 2006. 

The 2009 legislation implementing the settlement also accomplished two other goals, according to Stephen Olson, ICUL Executive Vice President and General Counsel.  First, it codified a rate reduction in regulatory fees on a going forward basis commencing January 1, 2009.  On a going forward basis, the rate reduction has resulted in $700,000± per year over the past three years, or $2.1 million back to Illinois state-chartered credit unions since the legislation became law.

Second, the 2009 legislation reduced the Credit Union Fund margin that triggers a credit back to Illinois state-chartered credit unions.  Olson noted the Credit Union Fund is the dedicated fund into which regulatory fees are deposited to offset the ordinary administrative and operational expenses of the DFI Credit Union Section in supervising state-chartered credit unions.  It is structured as an operating account, not a savings account.

To ensure adherence to that objective, the legislation reduced the margin level from 50 percent to 25 percent.  Olson explained when the balance in the Credit Union Fund at the end of a State fiscal year exceeds 25 percent of the expenses incurred by the State in administering the Illinois Credit Union Act and related laws, the excess must be credited to the credit unions that paid the fees in the first instance.  As a result of the legislation, Illinois state-chartered credit unions received an aggregate FY2010 margin credit of $1.45 million, which equaled a full 4th quarter fee holiday for 2010, as well as a partial holiday on their 2011 first quarter fees paid to the regulatory agency in April 2011.  That was in addition to the aforementioned FY2011 fee holiday and partial credit for 4th quarter 2011 and 1st quarter 2012, respectively.

"We are particularly pleased that the prosecution and favorable settlement of the regulatory fee case continues to provide direct financial remuneration to our 285 Illinois state-chartered credit unions," said Olson.

"The latest credit shows that the settlement terms we negotiated with the State in 2008 remain beneficial for our credit unions," said Dan Plauda, ICUL President/Chief Executive Officer.  "Certainly, it comes at a good time given the continuing difficult economic and regulatory environment."

New board seated at Convention
A multitude of elections by the Illinois Credit Union League (ICUL) and affiliated organizations took place at ICUL’s 82nd Annual Convention, including the seating of ICUL’s new 12-member board.

The change in the size of the ICUL board was as a result of a bylaw amendment passed by the Delegates in 2009 to address corporate governance of the League, through a reduction in the current size of its Board of Directors to 12 directors, effective January 1, 2012.  The bylaw amendment also re-defined the League board by three multi-chapter regions (districts) of four directors each based on member size: less than 3,000 members (Class A), 3,000 – 9,999 (Class B), 10,000 or more (Class C) and At Large (Class D).

Geraldine Burek, CEO of South Division Credit Union (Evergreen Park), was elected Chairman.  Burek will serve on the League board as the Class B director for District 2 and has been an ICUL Director since 2003.  During this time, she has also been chairman of the annual convention and legislative committees, served on the executive committee, and on the CUPAC board for 21 years.  In addition, she began serving on the ICU Foundation board in 2009.  Burek will also serve as ICUL Service Corporation (LSC) Chairman.

Pete Paulson, CEO, Corporate America Family Credit Union (Elgin), was elected Vice Chairman.  Paulson, from the Fox Valley Chapter, will serve as the Class D At Large director for District 3 and has been on the League board since 2003.  During that time, Paulson has also participated on the annual convention and executive committees.  He was also on the LSC board for four years.  Paulson will serve as LSC Vice Chairman.

Lastly, Peggy Cummins, CEO, Three Rivers Community Credit Union (Mt. Carmel) was elected Secretary/Treasurer.  Cummins, from the Southern Illinois Chapter, will serve as the Class A director for District 1.  She has been on the League board since 1996 and during that time has also served on the annual convention, credit union support group, executive, and legislative committees. In addition, she has served on the ICU Foundation board since 2001.  Cummins will also serve as LSC Secretary/Treasurer.

The full ICUL 2012 board of directors is as follows:

  • District 1 (Sangamon Valley, Southern, Boyle, Danville Area, Quincy, Burnett, Egyptian, Greater Decatur, and Kelly chapters): Class A - Peggy Cummins, CEO, Three Rivers Community Credit Union (Mt. Carmel); Class B – Kerry Fearn, CEO, Area Educational Credit Union (Mattoon); Class C – Alan Meyer, executive vice president/COO, 1st MidAmerica Credit Union (Bethalto); and Class D - Dennis Schaefer, CEO, SIU Credit Union (Carbondale).

  • District 2 (Central Illinois, Kankakee, Chicago Metro, Will County, Galesburg, Aurora, Bloomington, Illinois Quad Cities, and Tri-County chapters): Class A - Janet Francoeur, CEO, Riverside Community Credit Union (Kankakee); Class B – Geri Burek, CEO, South Division Credit Union (Evergreen Park); Class C – Tim O’Donnell, executive vice president, Financial Plus Credit Union (Ottawa); and Class D – Carl Sorgatz, CEO, Hawthorne Credit Union (Naperville).

  • District 3 (Northwest Illinois, Chicago Metro, Rockford Area, Brietzke, Doig, Fox Valley, and Northern Cook County chapters): Class A – Karen Jurasek, CEO, Generations Credit Union (Rockford); Class B – Patrick Basler, CEO, First Financial Credit Union (Skokie); Class C – Sean Rathjen, CEO, Consumers Cooperative Credit Union (Waukegan) and Class D - Peter Paulson, CEO, Corporate America Family Credit Union (Elgin).

Attendees "Get in the Game!" at League’s 82nd Annual Convention 
Nearly 680 executives representing 125 credit unions were in attendance at the League’s 82nd Annual Convention. 

Nearly 80 vendors packed the exhibit hall for the Convention April 26-28 at the Schaumburg Renaissance Convention Center, a brand new location for the event.  This year’s keynote speaker was Connie Payton, wife of the late football legend Walter Payton, who presented on "Family Values, Teambuilding, Embracing Life."  This session also included the changing of the gavel (see above story) . 

The Annual Convention also included 24 educational opportunities, including a "pre-con" workshop on Thursday followed by the first group of sessions, which began on Friday morning. The sessions offered opportunities for personal and professional growth. 

One unique session at this year's event was Organ Donation Importance on Friday morning.  More than 5,000 men, women and children in Illinois are on the organ transplant waiting list.  Because April was "Organ Donor Awareness Month," ICUL offered complimentary onsite donor registration sponsored by the Illinois Secretary of State’s office following Brittany Payton’s break out session. One donor can save or enhance more than 25 lives. 

The Disclosures, an acoustic thrift-rock duo from the land of credit unions, also performed on Friday of Convention.  The closing session featured Becky McCrary, considered "the Carol Burnett of Conventions", who presented: "A Passion for your Profession!" 

Other new features for this year’s convention included:

  • A mobile Web site, which intended to provide more information at the fingertips of attendees via their smartphones by scanning the convention QR Code.  The mobile web site featured: convention highlights, schedule and speakers, a hotel floor plan/map, a comprehensive list of area restaurants and attractions, including shopping and nightlife options, and a listing of exhibiting business partners.

  • A new a special one-day registration rate.  This was initiated to give credit unions the opportunity to bring extra staff to convention and included admission to the keynote session, the morning and afternoon education sessions, access to the exhibit hall and a "tailgate" lunch on Friday.  Ninety-six people from 34 credit unions took advantage of this new promotion.

  • Credit union "crashers".  This initiative was part of an effort to attract young professionals to this year’s event, under the guise The Cooperative Trust (formerly The Crash Network), a grassroots organization comprised of hundreds of young credit union professionals. Sponsored by ICUL and CUNA Mutual, Crash Illinois gave young credit union professionals the opportunity to participate in the event by attending the full convention as well as additional mentor sessions with industry thought leaders each day and building relationships with other young credit union professionals.

  • The opportunity for Continuing Professional Education (CPE) credits.  Many of ICUL’s convention sessions, as well its annual schedule of more than 60 "QuickBites," telecourses, and in-person sessions, are now CPE eligible.

"We hope that the convention met its goal of addressing the needs of our credit unions and provided great opportunities to help them better serve their members," said Tory Eckstein, Annual Convention Committee Chairman, CEO Members Choice in Peoria, Illinois, and retiring League Director for the Central Illinois Chapter of Credit Unions.  "We also hope our attendees thoroughly enjoyed their time at our new location."

Thanks to everyone who attended this year’s Convention and helped to make it a success!  If you have not already, please be sure to submit your evaluation, which is available via our Web site.  In addition, to view photos from the event, please check out the League’s Flickr photo album.  Please also see the "Events" section for additional Convention recaps.

Illinois Legislative Day provides new format, honors CU Champions
More than 110 credit union officials from throughout the state joined the League for its annual Legislative Day event at the President Abraham Lincoln Hotel and Conference Center in Springfield May 9.

Highlights included a new format with an earlier start time of 9:30 a.m., which significantly helped to provide attendees with an improved window of opportunity to visit with their local lawmakers earlier in the day than in the past.  This year’s event also featured a new luncheon, where Illinois State Treasurer Dan Rutherford provided keynote remarks.  During his state legislative career, Treasurer Rutherford has been a strong credit union supporter.  At the event, he discussed the vital role credit unions play in the financial market and offered an update on the financial challenges facing members of the Illinois General Assembly (IGA) as they prepare the state’s budget this session. 

As part of the luncheon, recognition of credit union champions Joseph Lyons (D-19, Chicago and assistant majority leader) and Lisa Dugan (D-79, Kankakee), who will be retiring from the Illinois General Assembly (IGA) after this Spring session took place.  Both lawmakers have been active on the boards of their credit unions, Credit Union 1 in Rantoul and Riverside Community Credit Union in Kankakee, respectively (see related story here).

Also on the docket was a regulatory update featuring National Credit Union Administration (NCUA) Board Member Michael Fryzel, who discussed key regulatory developments impacting the credit union movement.  Board Member Fryzel updated the group on corporate credit unions, natural person credit unions, pending and proposed rules, staff changes within NCUA, underwriter settlements, pending federal legislation, and his vision of the future of credit unions, while also discussing the State of Illinois credit unions compared to the rest of the country.  Fryzel also highlighted the continued importance of events such as ICUL’s annual Legislative Day.  He was followed by a corporate credit union update, in which Michael Lee, vice president of member relations for the Midwest region for Alloya Corporate Federal Credit Union, also discussed corporate credit union issues.

Prior to Hill visits with their state legislators to discuss issues critical to credit unions, participants were briefed by ICUL staff about key legislative initiatives and the current legislative environment in Illinois.  There have been more than 5,000 bills filed for consideration during this Spring session.  Currently, ICUL staff are concentrating on bills that remain active for the remainder of the session. 

Friday, May 4, 2012 marked the committee deadline for bills to advance in their second chamber (unless their deadline was extended), with many bills already on 2nd or 3rd Reading.  Unless the deadlines are extended, bills which failed to get out of committee by that date were essentially "dead" for the session. 

ICUL has been actively lobbying over 80 bills that could impact credit unions and their business operations.  Of those bills, only seven are actually supported by the League.  The rest ICUL opposes or have been modified to allow a neutral position on the measures.   These include:

  • S.B. 3217:  Illinois Credit Union Act amendments.  S.B. 3217 clarifies that the surviving credit union in a merger is a successor-in-interest and may enforce mortgages and other loans acquired from the merging credit union.  Also addresses (i) board authority to establish age eligibility voting standards, and (ii) membership status if a member doesn’t have at least one fully paid share.  S.B. 3217 passed the Senate unanimously on March 22 and is currently on 3rd reading in the House.

  • S.B. 2939:  Fee caps/restrictions on reloadable debit cards.  As a result of strong grassroots efforts by Illinois credit unions, as well as ICUL leading a coalition of lenders, retailers, and card issuers, S.B. 2939 was not called for a vote and is now essentially "dead."  The measure would have adversely affected credit unions by establishing government fee restraints and other restrictions on reloadable general-use prepaid debit cards beyond the parameters of the federal CARD Act.  

  • Mortgage foreclosure bills:  S.B. 2534 (Support)/S.B. 16 (Oppose).  Over 50 bills relating to the mortgage foreclosure crisis have been filed during the Spring Session of the IGA.  ICUL has been actively involved in efforts to provide meaningful relief to Illinois homeowners impacted by the foreclosure crisis, without burdening the financial services industry.  ICUL’s approach is to attempt to "fine-tune" the mortgage foreclosure process, rather than penalize lenders (and, ultimately borrowers) through increased fines and penalties.  At this point, these two competing bills are moving through the legislature and address the topic of foreclosures in very different ways.  ICUL supports S.B. 2534, which will create a "fast-track" mortgage foreclosure process for properties that are deemed to be abandoned.  S.B. 2534 has passed committee and is on 2nd Reading in the Senate.  The Senate 3rd reading deadline for this bill has been extended until May 25, 2012.

The event and evening was capped off by a legislative reception, which was brought back to the Governor’s Mansion, after attendee feedback showed this was a highly popular venue for this function in 2010.  Nearly 200 attended the reception, including the credit union attendees, 35 state lawmakers from both sides of the aisle, and other dignitaries.

The IGA is scheduled to adjourn on May 31, 2012.

To view photos from the event, please click here.

ICU Foundation provides first round of grants, scholarships for 2012
The Illinois Credit Union Foundation (ICU Foundation) recently awarded $42,880 in Small Credit Union Development (SCUD), Community Service, Marketing and Business Development, and Financial Independence & Revitalization Effort (FIRE) grants.

SCUD grants totaled $17,880 and were awarded to nine credit unions.  Purposes for the SCUD grants included technology upgrades, office equipment, and marketing materials, as well as upgrading security systems.  The recipients were: Chicago Fire Officers' Association Credit Union, Decatur Policemen Credit Union, Elgin Mental Health Center Employees Credit Union, Kaskaskia Valley Community Credit Union, Oak Lawn Municipal Employees Credit Union, Parish Members Credit Union, Peoria Journal Star Credit Union, Springfield City Employees Credit Union, And Urbana Municipal Employees Credit Union.

The Foundation also awarded $2,000 in Community Service Grants. This program is designed to encourage and reward chapter or credit union participation in local community projects.  Credit unions and chapters can qualify for grants by hosting an established event, creating an event, or volunteering at an established event.  Two chapters and two credit unions received a community service grant.  They were: the Danville Area Chapter, the Bloomington Chapter, Alton Bell Community Credit Union and Altonized Community Credit Union.

In addition, six credit unions received Marketing and Business Development grants that totaled $21,500.  The recipients were: Alton Bell Community Credit Union, Altonized Community Federal Credit Union, Armstrong Preferred Members Federal Credit Union, C.T. Community Credit Union, Rockford Municipal Employees Credit Union, and SIUE Credit Union.  These grants were established in 2006 to help credit unions with assets of up to $30 million to start or expand outreach efforts.  The maximum grant award is $5,000 per credit union per year.

Rounding out this round of grants was one credit union that received a FIRE grant totaling $1,500.  The purpose of the FIRE Program is to provide assistance to credit unions to expand their ability to build and maintain viable communities by providing credit and financial services to residents and businesses in low-income and underserved areas of Illinois.  Park Manor Christian Church Credit Union will utilize its FIRE grant for financial education, specifically to bring financial reality fairs to credit union members and the local community.

There are two more grant request deadlines during 2012 - July 31 and October 31. In addition, scholarships are reviewed on an on-going basis while funds last.  Online and downloadable grant request forms are available via the League's Web site.  Eligibility is limited to Illinois credit unions and chapters.

Program changes for Enhanced IIA GM Program
We have some exciting news!

While the Invest In America (IIA) program has been busy launching the newly enhanced IIA/GM program, there has also been work with GM to address the desire to ensure all members continue to have access to the GM Credit Union Member Discount. On a recent conference call with GM, they once again demonstrated the value they place on the partnership with credit unions.  The program has been revised as follows:

  • Premium Level – No Change:  This is the new level, added March 1, 2012, that requires a higher credit union commitment to market and support the IIA/GM Credit Union Member Discount program.  This level of support allows for access to private offers, additional marketing support from GM and CUSG, and employee pricing (EVA) for CU employees.  It would be on these CUs that CUSG and GM invest additional resources and effort to grow the program.

  • Standard Level – All 2,630 currently signed up CUs will be moved into this level that now includes marketing recommendations, not specific requirements: This level is represented by the 2,630 CUs already signed up to promote and support the IIA/GM Credit Union Member Discount program. FREE marketing materials are available, such as statement inserts, lobby materials, videos and web banners. These credit unions will continue to have flexibility on how they market the program to their members, as long as they do some marketing. They may use a variety of the following: paper or e-statement inserts, web banners and links, email, newsletters, videos, lobby materials, social media, direct mail, loan promotions, etc. Access to all these materials is available via the IIA Partner Center. 

Like other IIA programs, all members will continue to have access to the discount.  This will satisfy our mutual desire to (1) identify those credit unions more committed to the program in order to direct resources to them, and (2) ensure the broader credit union member community continues to be marketed to.

Key Takeaways

  1. No member will be restricted from preferred pricing;
  2. CUs currently signed up will be moved to the Standard Level and receive Free inserts upon request;
  3. Focus remains to enroll CUs at the Premium Level with emphasis on the top 500.

This is a huge win/win! GM really stepped up to the plate again and showed their continuing commitment to this program and the credit union community as a whole. Let’s return the favor and focus on building support for this program with our credit unions, together.

For questions or more information about the GM Program and/or IIA, please contact Vicki Ponzo at (800) 942-7124.

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