Congress must do more on liquidity, relief checks: NCUA’s Harper
Todd Harper, National Credit Union Administration board member, is urging lawmakers to protect stimulus payments from being garnished to cover outstanding debts.
A number of banks and consumer advocates have previously called upon Congress to ensure full access to these funds. Twenty-five state attorneys general have also voiced their concern, noting that stimulus payments garnished by creditors or debt collectors would undermine the intent of the CARES Act.
Harper echoed that stance in his letter to Sen. Mike Crapo and Sen. Sherrod Brown, heads of the Senate Banking Committee.
“Unfortunately, some depository institutions have garnished Economic Impact Payments to cover outstanding debts and court-ordered judgments,” Harper wrote in the letter dated Monday. “Financially stressed American consumers deserve much better.”
Over 30 million Americans filing for unemployment in the last six weeks, and a survey found that more than 75% of households have experienced a dip in income due to the coronavirus, Harper cited. Relief payments help those struggling financially pay their mortgage or rent, buy food and cover utilities and other necessities, he argued.
In the letter, the NCUA board member also requested that federal charters be permitted to add underserved areas to their field of membership. The request would grant single common-bond and community charters the ability to add underserved areas into their fields of membership. Currently only multiple-common bond credit unions are able to do this.
Harper also asked that temporary provisions of the CARES Act regarding NCUA’s Central Liquidity Facility be extended by at least a year or made permanent. The CARES Act made it easier for credit unions to join the CLF but those changes are set to expire at the end of the year.
Harper made similar comments during the board’s April meeting.
“The extension would provide the system with a sustainable source of liquidity during the COVID-19 pandemic and the ensuing economic uncertainty that seems likely to continue well into 2021, and perhaps beyond,” Harper wrote.
Granting NCUA vendor oversight, lifting the member business loan cap and maintaining capital standards rounded out the letter’s requests.
“These proposals will better equip the NCUA to both contain the pandemic’s economic impact on credit union members and the credit union system, and also protect consumers,” Harper wrote.