WASHINGTON STATE

Washington State House Democrats

HOUSE DEMOCRATS

Power to the people

Not every new Washington law makes the headlines, but every single one matters to some individual, group, or institution. For evidence, turn to Rep. Cindy Ryu‘s HB 2140, which was signed by Gov. Jay Inslee this week. It’s what’s known around Olympia as “a good little bill.” If you don’t belong to a state-chartered credit union, it won’t matter to you. In fact, unless you’re a member of a state-chartered credit union that’s hoping to merge with yet another state-chartered credit union, it still won’t affect your life.

But if you fall into that latter category, it gives you a greater say in whether that merger takes place. Rep. Ryu’s bill, which was cosponsored by Reps. Derek Stanford, Luis Moscoso and Steve Kirby, among others, eliminates the requirement that two-thirds of a credit union’s members approve such a merger – allowing it to go forward with a simple majority approval from members and each credit union’s board of directors. That’s how it works for federally chartered CUs, and now the supermajority rule for state-chartered credit unions has been eliminated.

Governor Jay Inslee signs House Bill No. 2140.Relating to credit unions' mergers. March 12, 2014. Aaron Barna
Governor Jay Inslee signs House Bill No. 2140.Relating to credit unions’ mergers. March 12, 2014.

As the bill report on HB 2140 explains, credit unions may want to merge because it allows financially troubled CUs to survive, while healthy ones sometimes merge for competitive reasons, such as to increase assets. Regardless of which situation is involved, it occurred to Ryu that since credit unions are, after all, owned by their members, those same members ought to be able to decide on mergers with a 50-percent-plus-one vote. And now they will.