2021 - 2022 LEGISLATURE
July 26, 2021 - Introduced by Representatives Murphy, Callahan, Baldeh,
Edming, Goyke, Krug, Kuglitsch, Loudenbeck, Rozar, Subeck, Tittl,
Tusler and Wittke, cosponsored by Senators Stafsholt, Bewley, Carpenter,
Jacque, Ringhand and Wirch. Referred to Committee on Financial
1An Act to repeal
to renumber and amend
186.11 (2); to amend
186.07 (7), 186.098 (1), 186.113 (15) (a), 186.115 (2), 186.118 (1), 186.118 (3) (a) 3
(intro.), 186.118 (4), 186.118 (5), 186.235 (14) (c), 214.04 (21) (b), 215.13 (46) (a) 4
1., 221.0303 (2), 227.10 (2m), 227.14 (2) (a) 8., 227.20 (3) (c), 227.24 (1) (b) and 5
227.24 (1) (d); and to create
186.11 (2) (b) and (c), 186.113 (26), 186.118 (3m) 6
and 227.01 (13) (yu) of the statutes;
relating to: authorized activities and
7operations of credit unions, automated teller machines of financial institutions,
8repealing rules promulgated by the Department of Financial Institutions, and
9providing an exemption from rule-making procedures.
Analysis by the Legislative Reference Bureau
This bill makes various changes related to the authorized activities and
operations of credit unions. The bill also repeals certain administrative rules related
to the placement or operation of automated teller machines (ATMs) by financial
Under current law, the Office of Credit Unions (OCU) in the Department of
Financial Institutions regulates credit unions in this state. Current law specifies
various authorized activities and powers of credit unions.
Parity with federally chartered credit unions
Current law includes the following provisions relating to parity between
federally chartered and state-chartered credit unions:
1. OCU must establish, by rule, a list of activities and powers incidental to the
business of a credit union that are authorized for federally chartered credit unions
as of April 18, 2014. A credit union chartered under Wisconsin law
(Wisconsin-chartered credit union) may engage in any activity or exercise any power
listed by OCU in addition to exercising any other power authorized for the credit
union. After April 18, 2014, if any additional activity or power incidental to the
business of a credit union becomes authorized for federally chartered credit unions,
OCU must make a determination, within 30 days after the activity or power becomes
authorized, as to whether the activity or power should also be authorized for
Wisconsin-chartered credit unions. In making this determination, OCU must
consider specified factors and, if OCU determines that the activity or power
authorized for federally chartered credit unions should also be authorized for
Wisconsin-chartered credit unions, OCU must, by rule, add the activity or power to
the list. An OCU rule that includes an activity or power in the list is exempt from
most administrative rule-making requirements, but deleting an activity or power
from the list or modifying the activity or power on the list requires OCU to go through
the normal rule-making process.
2. A credit union may undertake any activity, exercise any power, or offer any
financially related product or service that any other provider of financial products
or services may undertake, exercise, or provide or that OCU finds to be financially
related if OCU has specified, by rule, the activity, power, product, or service as one
that may be undertaken, exercised, or offered by a credit union.
3. OCU may, by rule, authorize credit unions to exercise any power under the
notice, disclosure, or procedural requirements governing federally chartered credit
unions or to make any loan or investment or exercise any right, power, or privilege
of federally chartered credit unions permitted under federal law if the Credit Union
Review Board approves. Such a rule may not restrict powers granted to credit unions
or affect provisions of the Wisconsin Consumer Act.
The bill makes the following changes to these provisions: 1) with respect to item
1., above, 30 days after an activity or power becomes authorized for federally
chartered credit unions, the activity or power also becomes authorized for
Wisconsin-chartered credit unions unless otherwise noted by an OCU general order
within this 30-day period; 2) with respect to item 2., above, OCU specifies the
activity, power, product, or service that may be undertaken, exercised, or offered by
a credit union by OCU guidance, not OCU rule; and 3) item 3., above, is repealed.
Credit union property
Under current law, a credit union may purchase, hold, and dispose of property
as necessary for or incidental to its operations.
The bill specifies that a credit union may purchase, lease, hold, and convey
certain real estate, including real estate conveyed to the credit union in satisfaction
of a debt or foreclosed real estate, subject to guidance by OCU and a five-year limit
on holding the real estate.
Under current law, a bank, savings bank, savings and loan association, or credit
union (collectively, financial institution) may acquire, place, and operate, or
participate in the acquisition, placement, and operation of, at locations away from
the financial institution, what is variously referred to as customer bank
communications terminals, remote terminals, or remote service units, in accordance
with rules established by OCU and DFI's Division of Banking (division). These
devices are terminals or other facilities that are not located at a financial institution
and through which customers and financial institutions may engage in electronic
transactions that are incidental to the conduct of the business of financial
institutions (collectively, off-site ATMs).
Under current rules of OCU and the division, a financial institution must
provide advance written notice to OCU or the division before acquiring, placing, or
operating an off-site ATM. The bill repeals these rules.
Current statutes provide that OCU or the division may, by order, authorize the
installation and operation of an off-site ATM in a mobile facility, after notice and
hearing upon the proposed service stops of the mobile facility. The bill repeals these
Vacancy on board of directors
Current law allows the board of directors of a credit union to remove a director.
Within 60 days after the date of removal of a director, the board of directors must
appoint a director to fill the vacancy. The bill requires a credit union's board of
directors to fill any vacancy, including a vacancy resulting from removal of a director,
within 90 days.
Nonmember loan participation
Under current law, a credit union may make loans to members upon terms
approved by the credit committee, loan officer, or board of directors.
The bill specifies that a credit union may allow nonmember loan participation
as a joint applicant, co-obligor, cosigner, co-borrower, surety, or guarantor.
The bill specifies that credit unions may issue or offer supplemental forms of
capital approved by OCU.
Charges for credit union examinations
Current law generally requires OCU to conduct, at least once every 18 months,
examinations of credit unions in which OCU examines the credit union's records and
accounts. OCU must charge the credit union for the cost of the examination, and the
credit union must pay the charge on the day on which the examination is completed.
The bill requires the credit union to pay the charge within 30 days of the
completion of OCU's examination.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
186.07 (7) of the statutes is amended to read:
186.07 (7) Vacancies.
days after the date
of a removal vacancy
3on the board of directors
, the board of directors shall appoint a director to fill the 4
vacancy. The appointee shall serve until a successor is elected at the next annual 5
186.098 (1) of the statutes is amended to read:
186.098 (1) Loan approval.
The credit union may make loans to members upon 8
terms approved by the credit committee, loan officer,
or board of directors. The credit
9union may also permit a nonmember to participate in an obligation or extension of
10credit to a member as a joint applicant, co-obligor, cosigner, co-borrower, surety, or
186.11 (2) of the statutes is renumbered 186.11 (2) (a) and amended 13
(a) A Subject to pars. (b) and (c), a
credit union may purchase, hold, 15
and dispose of property as necessary for or incidental to its operations.
186.11 (2) (b) and (c) of the statutes are created to read:
(b) Subject to guidance issued by the office of credit unions, a credit 18
union may purchase, lease, hold, and convey the following types of real estate:
1. Real estate conveyed to the credit union in satisfaction of debts previously 20
contracted in the course of the credit union's business.
2. Real estate purchased at sale on judgments, decrees, or mortgage 22
foreclosures under securities held by the credit union, but a credit union may not bid 23
at a sale a larger amount than is necessary to satisfy its debts and costs.
3. Subject to the approval of the office of credit unions, real estate acquired or 25
held by the credit union for any other purpose.
(c) Real estate acquired under par. (b) may not be held for more than 5 years, 2
unless an extension is granted by the office of credit unions.
186.113 (15) (a) of the statutes is amended to read:
(a) Directly or indirectly, acquire, place,
and operate, or 5
participate in the acquisition, placement,
and operation of, at locations other than 6
its offices, remote terminals, in accordance with rules established by the office of 7
credit unions. The rules shall provide that any remote terminal shall be available 8
for use, on a nondiscriminatory basis, by any state or federal credit union which has 9
its principal place of business in this state, by any other credit union obtaining the 10
consent of a state or federal credit union which has its principal place of business in 11
this state and is using the terminal and by all members designated by a credit union 12
using the terminal. This subsection does not authorize a credit union which has its 13
principal place of business outside the state to conduct business as a credit union in 14
this state. The remote terminals also shall be available for use, on a 15
nondiscriminatory basis, by any state or national bank, state or federal savings bank 16
or state or federal savings and loan association, whose home office is located in this 17
state, if the bank, savings bank or savings and loan association requests to share its 18
use, subject to the joint rules established under s. 221.0303 (2).
The office of credit
19unions by order may authorize the installation and operation of a remote terminal
20in a mobile facility, after notice and hearing upon the proposed service stops of the
186.113 (26) of the statutes is created to read:
186.113 (26) Supplemental capital.
Issue or otherwise offer supplemental 24
forms of capital in such form and with such conditions as are approved by the office 25
of credit unions.