AUSTIN, Texas—The Texas House of Representatives has passed a bill that allows for the creation of “credit union development districts.”
The Bill, HB 1626, sponsored by Re. Eric Johnson (D-Dallas), would allow local governments to designate areas that need additional traditional financial services as a bank or credit union development district. As originally written, the bill included banks only, before the Cornerstone CU League lobbied to have credit unions included, as well.
“Many Texans live in areas that are underserved by credit unions and banks,” said the Cornerstone League. “HB 1626 seeks to address this issue by implementing programs that encourage credit unions and banks to open branches in areas where there is a demonstrated need for credit union and banking services.
The CCUL said the bill authorizes the Credit Union Commission and the Finance Commission to administer and monitor the credit union or banking development district program in consultation with the Texas Economic Development and Tourism Office to adopt the rules regarding the criteria for the designation of the districts.
“They must consider the location, number, and proximity of sites where services are available in the proposed district, the consumer needs for those services, the economic viability and local credit needs of the community in the district, and the impact that additional services would have on the economic development in the proposed district,” the league noted. “The commissions have up to 120 days to make a determination regarding whether to approve the application from a local government and credit union.”
The financial commissions would be required to adopt rules governing the designation of credit union or banking development districts by January 1, 2016.
The bill now goes to the Texas Senate.