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The Magazine of the League of Southeastern Credit Unions

Filene i3

Enriching, Rewarding, and Life Changing

LSCU

Message from the President Every December we look back on the year and wonder how we got here so quickly. 2013 is no different. However, we’ve had quite a few changes at the LSCU & Affiliates with the biggest coming in midDecember. By the time you read this, our Tallahassee office will have moved across town to the newly coined “Credit Union Center.” We will share the building with Corporate One, CU Members Mortgage, and Member Business Solutions.

For the better part of the past 18 months, we have been looking at our current and future facility needs in Birmingham and Tallahassee. The goal was to find the most efficient and effective use of space while providing a great work environment for our staff. An amended and extended new lease was signed in Birmingham that reduced our overall space under lease at a more favorable rate. It also included lease holder improvements, which should be completed by the end of the first quarter 2014.

In Tallahassee, we decided to sell our existing property and move to the building that houses Corporate One. It was formerly the headquarters of Southeast Corporate Credit Union before it merged with Corporate One. This will instantly upgrade our office space for staff. That is, a newer building with modern amenities. With the new lease in Birmingham and the move in Tallahassee, the LSCU & Affiliates is projected to save more than two million dollars over seven years once we sell our existing facility in Tallahassee. This helps our long-term sustainability as an organization, but also allows us to be able to continue to provide the level of service and products our member credit unions have come to expect from the LSCU & Affiliates.

Also in December, Lisa Burroughs came on board at LEVERAGE as our new SVP of strategy and business operations. Lisa has spent the majority of her career working with credit unions in Michigan. She has held positions from vice president of marketing to chief operations officer to chief executive officer. She was most recently the COO of Michigan Schools and Government which is a $1.3 billion credit union in metro Detroit. Lisa will bring new energy and leadership to LEVERAGE. We have a number of exciting opportunities coming to LEVERAGE in 2014. Stay tuned!

Lisa will also be a part of the LSCU & Affiliates executive management team. In October, Scott Morgan, SVP of finance and administration, left after 17 years for a great career opportunity closer to his home in Thomasville, GA. Scott’s departure allowed us to transition Marvin Garland into the EVP/chief financial officer role. Marvin will oversee all of the LSCU & Affiliates finance and administration functions. With his certified public accounting background, he will excel in this role. Marvin will also continue to oversee the CU Audit and Compliance services, as well as be involved in new business acquisitions. Each of these moves makes us stronger and more effective.

As you can see, the last few months of the year have been eventful at the LSCU & Affiliates. We are excited to get started in 2014. I hope you have a wonderful holiday season. Thank you for your membership with the League. I look forward to seeing you in the New Year.

By the time you read this, our Tallahassee office will have moved across town to the newly coined “Credit Union Center.” We will share the building with Corporate One, CU Members Mortgage, and Member Business Solutions.

Patrick La Pine, CCE, CUDE President & CEO League of Southeastern Credit Unions

SIGNAL: Vol. 4, Issue 4

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Table of Contents Editor Amy Jowers Contributors Bill Berg Mike Bridges Jason Cochran Natalie Edwards Anita Fumaria Andrew Gonzalez Teresa Gray Keith Hopkins Kevin Lytle Jennifer Martin Leonard Parkhurst Laura Lee Vann Adena Whitman

Congressman Alcee L. Hastings

Design & Production Perry Albrigo, Pomegranate Studio Letters to the editor may be submitted at submissions@lscu.coop.

Connect with us!

Representative Paul DeMarco 1

President’s Message

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Trends 4 Filene i3 Is Enriching, Rewarding, and Life Changing The Filene Research Institute is one of the true gems of the credit union movement. This “think tank” churns out thought-provoking research reports that really dig deep into what matters most to credit unions. Hear from a couple of credit union staffers about how their involvement has added value to their credit union and individually.

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LeagueofSECUs

Generic answers do not cut it anymore, personally or professionally. Individuals have specific needs and expect every tool, from smart phones to lending options, to reflect that. Businesses that do not have specialized, personalized, individualized options may no longer survive as they once did. Find out how niche-lending has helped credit unions serve their members in a unique way.

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There’s a Loan for That – Credit Unions Find Their Niche

Advocacy 8 2014 Alabama Legislative Session Preview 10 2014 Florida Legislative Session Preview 11 Who Can Help Strengthen Credit Union Political and Legislative Success?

12 Overview of CFPB’s New Mortgage Lending Rules – Part 1 14 Myra Toeppe Q&A

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LSCU Legislator Profile 16 Congressman Alcee L. Hastings 18 Representative Paul DeMarco Cooperative Initiatives 20 Uniting for Good Through Affiliation 22 Number of Financial Counselors Continues to Grow in Alabama and Florida Via REAL Solutions Enhanced FiCEP 23 Credit Union Young Professionals Meet to Explore Award-Winning Financial Education Television Show

HIGHLIGHTS 8 | ADVOCACY Take a look at what is ahead for the Alabama and Florida legislative sessions.

12 | COMPLIANCE A quick overview of some of the CFPB’s new mortgage lending rules.

22 | COOPERATIVE INITIATIVES 25

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Foundation 25 SECUF to Utilize Fair Share Contribution Option Education 26 Another Successful Leadership Development Conference 28 Wrapping Up Education In 2013, Moving Forward To 2014 29 Upcoming Learning Opportunities Communications 30 Are Your Employees Hearing What You Are Saying?

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League News 31 Cheney Visits Provide Open Dialogue with Credit Unions

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Industry 32 Healthcare Changes and Your Credit Union 34 Make a Smooth Move with a Moving Professional

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The FiCEP program certifies credit union employees to be financial counselors; a win-win for the credit union and its members.

29 | EDUCATION Review the 2014 learning opportunities to plan for your 2014 training needs.

30 | COMMUNICATIONS Effective communications skills are a must for a leader. Find out if you are effectively reaching your staff.

32 | INDUSTRY Learn how healthcare changes affect your credit union.

LEVERAGE 36 Identity Theft Help Your Members Feel Secure Online 37 Vendor Management Solutions Are Growing 2010, 2011, & 2012

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TREND

Filene i3 Is Enriching, Rewarding, an

By Mike Bridges, vice president, Communications, LSCU

The Filene Research Institute is one of the true gems of the credit union movement. This “think tank” churns out thoughtprovoking research reports that really dig deep into what matters most to credit unions. The research makes credit unions really examine how they do business and what the future of their business model should look like. In other words, Filene inspires credit unions to be better and think differently.

Ten years ago, Filene created the i3 project. I3 stands for ideas, innovation, and implementation. The concept was simple: bring the next generation of credit union leaders together and see what they can come up with to help members. The first class Garcia also says being a part consisted of 25 credit union of a class with strong opinions CEOs and staff. Among them is difficult, but teaches you to was Tampa-based floridacentral listen and consider all ideas.

Credit Union CEO Laida Garcia.

Each class is a different size, She took the chance that this but the formula is the same. The new program would not only be Laida Garcia participants commit to two years inspiring, but would blossom. and they work in four six-month “The idea of an i3 group innovation cycles, which includes two face-toreally appealed to me and being part of a face meetings per year. It’s a prestigious honor team responsible for the innovation and to be chosen for an i3 class. Tuscaloosa-based implementation of new industry concepts gave Alabama Credit Union COO Kayce Bell was part me an opportunity to contribute opinions and of the 2013 class. She says the opportunity fit help to make a difference. And, who doesn’t right in with what was going on in her head as want to be part of an inaugural team? The she worked in her credit union every day. word itself screams the beginning of something “I had this growing list of ‘why can’t we’ great,” said Garcia.

Kayce Bell believes credit unions would be well served to support the Filene innovators.

ideas that my daily co-workers were sick of hearing about. Plus, my credit union didn’t have the time or resources to develop them.

Working with the Filene group on a project from prototype, testing, branding, and launch, in just six months, was too good to pass up,” said Bell.

The second “I” in i3 gets most of the headlines in the program. Innovation is a word that is extremely overused among credit unions on Twitter and blog posts. Innovation is pushed because it is meant to show that credit unions have the latest technology or product.

Theoretically this shows the consumer that credit unions have exactly what they want. George Hoffheimer, chief research and innovation officer

“Many people think innovation is about just products, but we’ve found in i3 that is products and new services, new business models, and new internal efficiencies, as well. >> George Hoffheimer, chief research and innovation officer at Filene

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nd Life Changing at Filene, explains how they take the word innovation and apply a slightly different meaning.

“Many people think innovation is about just products, but we’ve found in i3 that is products and new services, new business models, and new internal efficiencies, as well. Our program focused on these types of innovations and teaching them to today’s doers, which in many cases are tomorrow’s CEOs,” said Hoffheimer.

While innovation gets the headlines, the project work at i3 is what sets the program apart. The group doesn’t just sit around and discuss “pie in the sky” ideas; they actually formulate them and introduce them. As Bell said, they have six months to go from idea to implementation. Each group works closely together to find a solution to a common consumer problem. One of the programs Bell worked on was the Credit Union Career Corps. It is designed to take advantage of emerging talent from universities that are underemployed or have no job at all.

Suzanne Weinstein, CFO of Orlando FCU, is also in the 2013 i3 group. She is standing at the far left.

A number of products being used by credit unions today were started through the i3 program. Some include: ■■ ■■ ■■

Save to Win Debt in Focus, which is now SavvyMoney Savings Revolution, which has been adopted by dozens of credit unions projectmoney. summitcreditunion.com

“It inspires to build an ‘employer of choice’ brand for credit unions. However, it also addresses the student debt and helps the students to reduce their debt. Filene selected the program to be built out in its Innovation Lab,” said Bell.

Garcia says that she can draw on her i3 experience every day by pushing the teamwork concept with her management team. A forward, progressive thinking team will always push the credit union to do more than they thought possible. She says putting the right people in the right spots in her credit union helps them

to be successful. In turn this trickles down to floridacentral members.

“The experience has served to help me bring out the creativity of my own leadership team and to encourage innovation in our workplace. We have also implemented a number of i3 ideas at our credit union, giving us a competitive edge in product offerings and marketing strategies,” said Garcia.

The experience for Bell was very similar to that of Garcia. She explained that it was energizing being around her classmates, and that at the end of each meeting she was worn out mentally. Plus, she learned many new tools that she employs back at Alabama Credit Union.

One of those tools is actually delegating which allows Bell’s credit union team to shine and help shape their own projects. They are now not only implementing their ideas, but they have learned to look ahead at the next big thing for their credit union.

“Credit unions would be well served to support the Filene innovators. The framework is tested, the resources are abundant, the results are evident, and those folks (Filene) have it going on. They exude passion for improving consumers’ lives and growing credit unions’ ability to serve,” says Bell.

For credit union staff that are interested in joining the next i3 class at Filene, sign up online (filene.org/community.i3) for an email to alert you to when the application process opens. It usually opens in late spring.

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TREND

There’s a Loan for That – Credit Uni

By Natalie Edwards, communications coordinator, LSCU Whether you need help financing a storm shelter, your tuition, a used car, a missionary and/or church -there’s a loan for that. Niche lending programs, which are designed for a limited or specific group of people or a distinct purpose, are growing in popularity among credit unions. Though the world of specialty or niche lending may not be quite as vast as the App store, there are correlating themes between the two, mainly in the purpose behind their creation.

Both apps and niche lending plans are generally created from a consumer need, as a marketing tool, or to generate revenue.

Additionally, both apps and niche lending plans are examples of our future and where our personalized society is moving.

The one-size-fits-all (or most) philosophy of the past no longer applies. Generic answers do not cut it anymore, personally or professionally.

Individuals have specific needs and expect every tool, from smart phones to lending options, to reflect that. Businesses that do not have specialized, personalized, individualized options may no longer survive as they once did.

This puts credit unions at a great advantage.

Credit unions have always focused on their individual members and specific community.

Listening to the needs of their members and creating a personal banking experience based on those needs is nothing new for credit unions.

However, what is new is the variety of services, particularly lending products, credit unions are now offering their members.

Whether created out of a member need, to promote a specific credit union, or simply to generate income for the credit union, niche lending ends up benefiting both members and credit unions. Members benefit from credit unions with a better understanding of their

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A Magazine of the League of Southeastern Credit Unions

needs, and in many cases, better rates and lower fees. Credit unions benefit from increased growth and membership and being positioned as key organizations in a particular market, which may lead to individuals and businesses seeking out those credit unions for their expertise.

Although niche lending may not be right for all credit unions, some have been able to identify with a segment of their market and remedy a problem, often leading to increased loan volume and improved member satisfaction.

Rocket City Federal Credit Union in Huntsville is one of those credit unions. In May 2012, after a series of devastating storms and tornados took its toll on the state of Alabama, Rocket City created a lending program for storm shelters.

Members who owned their own home could borrow up to $7,000 at an APR of 3.98 percent for 48 months.

“We saw the need,” said Rocket City CEO Marquetta Cantrell. “We saw that people needed storm shelters, and we saw that people couldn’t obtain them.”

Marquetta Cantrell Though the program is not presently widespread, it has potential to grow and, in the meantime, it is helping both the credit union and its members.

“To me this is a better loan than a signature loan any day,” said Cantrell. She explained that to her there is not any more risk in this compared to a more traditional lending option, in part because, since shelters are something the credit union’s members need, members are more likely to follow through on payments. And, because the loan is secured by the member’s home, if a member is unable to make payments

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because of a financial crisis, the credit union is protected.

So far, Cantrell has been right. Out of the ten members who took out storm shelter loans, four loans have been paid off and there have been no delinquent payments on the remaining six.

University of South Alabama Federal Credit Union (USA) in Mobile also found a need-based niche in their immediate community – the university. The University of South Alabama did not offer a deferred payment plan for students because the expense of a tuition plan was cost prohibitive for the university due to the personnel, software, and other expenses needed to implement such a program.

Needing a solution for students who could not afford the full amount of tuition, fees, and other costs by the payment due date and unable to provide a solution, university officials contacted former credit union manager Betty Gorham and asked for the credit union’s assistance.

After going through a development process that included working with the student accounting office to obtain the average cost for a full-time student living on campus, roleplaying to determine all the pertinent information necessary for students and parents, developing sample payment plan calculations, researching similar type of loans, and meeting with the credit union attorney to produce appropriate documents, the credit union answered with the USA Federal Credit Union Tuition Payment Plan.

This program offers a low-cost plan for financing 100 percent of tuition, fees, housing, and meals with equal payments over the term of the semester. The plan also makes a book allowance up to $750 available. The APR is 12 percent, and subject to change. In order to qualify for the tuition loan, a student must meet the Credit Union’s eligibility requirements and join the USA Federal Credit Union.

ions Find Their Niche USA’s Tuition Payment Plan has been a huge success. It has helped a number of students complete their education, some of which would not have been able to so do without the program. Additionally, it has been a great source of income for USA. “It opened a door for us to reach the students and their families. Tuition loan processing has resulted in increased membership and additional loans for Felcia McKee the students and their families. It benefits our students by bridging the gap of their educational expenses that financial aid does not cover. It also establishes credit for the student by reporting monthly to the credit bureau,” said University of South Alabama FCU Manager Felicia McKee. While Rocket City FCU and University of South Alabama FCU found need-based niches, other credit unions like eCO Credit Union in Birmingham have created specialty lending programs to promote or market their credit union. In eCO’s case, they created a specialty loan to promote and celebrate their 75th anniversary.

“We wanted to offer members a loan that would highlight the celebration and reward loyal members. From this, we created the Anniversary Loan,” said Melissa Reeves

Melissa Reeves, eCO Credit Union marketing manager.

The Anniversary Loan is only available to teachers and for a limited time. It has a limit of $2,500 and has rate 7.5 percent APR with terms up to 24 months. Credit is not taken into consideration when offering this loan, so members are required to have direct deposit or payroll deduction.

Like most niche loans the result has been a win-win for the credit union and its members.

“It benefits our members because it’s available to teachers regardless of their credit score or credit history. It is a way to help our core membership who might have a harder time receiving a loan elsewhere,” said Reeves.

“Additionally, the program has benefited the credit union because it has increased our loans, and it shows teachers our commitment to them.”

Other credit unions have turned to niche lending simply to increase revenue and ultimately survive in a changing market. Prior to 2008, Central Florida Postal Credit Union in Orlando was focused mostly on mortgages and home equity loans. Then the housing market plummeted and its loan portfolio started dropping.

The fact that Central Florida Postal was a small credit union among financial giants did not help the situation. Nor did the fact that this was all happening at a time when their members, postal workers, were concerned, and rightfully so, about keeping their jobs. So the last thing on the members’ minds was to take out more money that they might not be able to pay back.

Needless to say, Central Florida Postal was not seeing a lot of walk-in business.

“We needed to do something and car loans were the best thing,” said Jim Weibert, CEO of Central Florida Postal.

Weibert expanded the field of membership to include postal customers. Then he set up training for his branch managers to teach them

how to meet with car dealers and ask for business.

After completing the training, Weibert had the managers pound the pavement and visit middle of the road, independent Jim Weibert “mom and pop” used car lots and ask the owners for two deals a week. “You have to prove yourself first,” Weibert explained.

Central Florida did prove itself and everyone involved benefited. The dealerships made sales, new car owners obtained low financing, and the credit union saw the increased membership and loan portfolio it needed. In fact, Central Florida Postal’s membership has grown tremendously since they expanded membership and started financing used cars.

Central Florida Postal is proof that a credit union must evolve with change - not ignore it, even when it comes to the lending services it is offering. “You can’t just keep doing the same things over and over and expect results,” said Weibert. “You have to get out of your offices and comfort zone and ask for the business.”

“Just go for it,” says McKee. “There are so many unique markets within our memberships that need assistance. Credit unions were designed for that purpose. The tingle you get in your heart when the member looks at you and says, ‘I love my credit union, you’re the best,’ makes it all worthwhile.”

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ADVOCACY

2014 Alabama Legislative Session Preview

By Jason Cochran, director, Governmental Affairs – Alabama, LSCU The 2014 Legislative Session begins Jan. 14 and many are predicting a rather muted final year of the quadrennium.

Because the 2014 session is starting nearly a month earlier than the past two sessions, rumors are going around that both the House and Senate plan to work as quickly as possible in order to get back home and hit the campaign trail.

While the two sides have yet to agree on how early to finish the session, the general consensus is that no one should expect to be in Montgomery after the second week in April; a couple of weeks before the session is required to end by law. There is the possibility of being finished just before spring break, but that is considered a longshot at this point.

Public Deposits: In 2013, credit unions made it well known that public deposits is a top priority and while a bill was not introduced due to time constraints, it remains a top priority for 2014. Being an election year, it will be difficult to pass legislation that is in any way controversial; however the League will continue to advocate for and attempt to move this vital and fair bill.

Alabama State Credit Union Act: Additionally in 2013, credit unions saw the introduction of a bill to update the Alabama State Credit Union Act. The League worked with the credit union administration to construct legislation that would encompass both groups’ preferred changes for state chartered credit unions throughout the state. The bill was introduced and, like public deposits, was a victim of the

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Because the 2014 session is starting nearly a month earlier than the past two sessions, rumors are going around that both the House and Senate plan on working as quickly as possible in order to get back home and hit the campaign trail. legislative calendar. The League has already started work to make sure this legislation is introduced in 2014. The League has received reassurance from the Senate Banking & Insurance Committee that this legislation will be heard early in the session.

What to Expect on the 2014 Legislative Agenda: To date there have been 43 pre-filed bills in the Alabama House and 36 in the Alabama Senate. A large majority of these pieces of legislation are local bills, bills with little controversy, or bills that have little chance at passing.

One piece of legislation that will receive a considerable amount of attention is a bill to stop lawmakers from resigning their elected position to become lobbyists. Over the past several months there has been a mini exodus of high ranking legislators leaving to become lobbyists or consultants with government affairs firms. Most notably were Reps. Jay Love and Jim Barton. Both were the chairmen of the House Ways and Means Education Committee and House Ways and Means General Fund Committee and are now working as lobbyist in the private sector.

Currently the law requires legislators to wait three years before lobbying in the assembly from which they resigned; there is no waiting period to lobby the opposite assembly.

The proposed new law would apply the three-year waiting period to lobby in both assemblies of the legislative branch. This

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issue has and will continue to be a hot topic as the 2014 session begins.

There will always be other pieces of legislation that will impact credit unions either in a positive or negative way. Right of redemption legislation, bills on electronic titling of vehicles, data breach legislation, and others are also a possibility in 2014. The League plans to support and actively lobby on behalf of credit unions whenever such issues arise. Look for weekly updates on the 2014 session in e-Signal Daily and be ready and available to contact your lawmaker on credit union issues as they emerge. If you have any questions or concerns, contact any member of our governmental affairs team.

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2014 Florida Legislative Session Preview

By Jennifer Martin, director, Governmental Affairs – Florida, LSCU The upcoming 2014 Legislative Session coincides with an election-year. Gov. Rick Scott, three state cabinet members, and many lawmakers will keep an eye on their electoral fortunes as they wade through the 60-day session that convenes on March 4, 2014.

As always, the budget will be a major focus this session as the only constitutionally required item needed to be passed by the state legislature. Early estimates show the state should have a budget surplus in the range of $850 million for the 2014-15 fiscal year. State agencies presented their budgetary “wish lists” to lawmakers back in October during committee weeks.

The League’s top priority this year is to continue to advocate for legislation allowing credit unions to become qualified public depositories. While last year a bill was filed, it was not voted on in either the House or Senate. This year, the League’s Governmental Affairs team has been working diligently on the best strategy to move this issue forward. Further, the League has been working on a bill with the Office of Financial Regulation (OFR) that deals with Chapter 657 in Florida Statute and would provide regulatory relief for credit unions.

The draft language essentially mirrors the bank statute, with the addition of certain committee members. Currently, bank regulation staff requests the names and addresses be submitted in the form of a letter to OFR, rather than a full biography, which is the documentation OFR would also accept from the credit unions if this bill passes. Other issues the League will be advocating for include foreclosure issues,

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data security, and preserving the credit union tax exemption.

Here are some of the major issues on Florida lawmaker’s 2014 legislative agenda:

and other groups, Medicaid expansion, which could bring some $51 billion to the state and cover one million uninsured Floridians, will likely return as an issue.

Flood Insurance

Gaming

With few signs Congress will act swiftly to curb flood insurance increases affecting tens of thousands of Floridians, state lawmakers are exploring options outside the National Flood Insurance Program to protect homeowners in low-lying areas. Legislators have toyed with several Florida-based alternatives in recent weeks, such as setting up a state-backed insurance company in the mold of troubled Citizens Property Insurance Corp. but that has not gained any traction, given the problems associated with the state-run insurance company. While Florida lawmakers are not pursuing a state-backed option, they need to do something if the federal government does not act and private insurers are not willing to offer affordable flood insurance policies.

With a growing number of well-financed interests invested in this issue, gambling legislation is always a heavy lift for the Legislature. Election-year pressure increases the difficulty in making major changes in Florida’s gambling laws, but efforts continue to do something. Out-of-state groups see Florida as a perfect location for at least one “destination” casino operation, bringing a full range of Las Vegas-style gambling to the state. A gambling agreement with the Seminole Tribe is scheduled to end in 2015, prompting some to promote a new deal before the next election.

Medicaid Expansion Although he has been a longstanding critic of health care reform, Gov. Scott surprised lawmakers last spring by endorsing the expansion of Medicaid under the health care law; as long as the federal government paid for the expansion. The Senate passed an expansion plan in the 2013 session but it died in the House, where leaders have voiced skepticism about the long-term cost and the ability of the federal government to finance the program. But with pressure from the health care industry, business leaders,

Tax Cuts Gov. Scott is calling for $500 million in unspecified tax cuts in the next budget year. Lawmakers are likely to back tax cuts, although the scope of the cuts and what type of taxes will be reduced will be part of the debate. A variety of proposals are on the table, including a further reduction in the number of businesses owing the state corporate income tax, lower property taxes, an expanded sales tax holiday, a reduction in the communications services tax that Floridians pay on their cellphone and cable TV bills, and cutting the motor vehicle fees that were raised in 2009 when the state was struggling to balance its budget while facing declining revenues.

The League’s top priority this year is to continue to advocate for legislation allowing credit unions to become qualified public depositories.

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ADVOCACY

Who Can Help Strengthen Credit Union Political and Legislative Success?

Your Credit Union, Your Staff, & Your Members

By Andrew Gonzalez, grassroots & political action coordinator – Florida, LSCU

One of the most important parts of credit union advocacy is PAC fundraising.

The LSCU’s ability to engage monetarily in state and federal races allows credit unions the strength to be successful both politically and legislatively.

To put it simply, a strong PAC fundraising program allows credit unions to support credit union friendly candidates.

Many credit unions are hesitant to go to their employees or members for PAC contributions. With a diverse group of members and employees, some credit unions are afraid to ask for PAC donations due to members’ and employees’ wide array of political beliefs. It is important to note that LSCU PACs are non-partisan and give only to candidates who support credit unions.

The Deduct-A-Buck program has the potential to be an enormous tool for the credit union movement. By asking credit union members to automatically deduct a dollar, or more, each month, quarter or year, from their checking or savings account for political activity, we can build an unparalleled base of support that will allow credit unions’ political power to increase exponentially.

Having a very small dollar amount automatically deducted every month is barely noticeable, and yet adds up over time. If a credit union member chooses to donate $5 every quarter (four times a year) they will have contributed $25 over a year’s time.

This is a small monetary amount in order

It is important to note that LSCU PACs are non-partisan and give only to candidates who support credit unions. to preserve the services that credit union members rely upon so much.

Another way credit unions can support the PAC is by implementing a payroll deduction program. The payroll deduction program pairs an employee contribution with the timing of the familiar payroll deduction process and is an easy and convenient way for employees to participate in the PAC. LSCU has created forms that can be completely tailored to your payroll process and the frequency and amounts of contribution can be determined by the employee enrolled. The program allows credit union employees become involved in the political process and provides the PAC with the funds necessary to support credit union friendly candidates in Congress. It is a win-win situation!

In 2013, Listerhill Credit Union employees and members contributed more than $6,500 to LSCU political action committees. When making payroll deduction available at Listerhill Credit Union, Brad Green, president/ CEO said, “PAC contributions, in my opinion, are donated to support of credit union issues and not candidates themselves. A member or employee’s contribution to the PAC goes a long way in preserving the credit union tax exempt status or increasing our ability to make small business loans by elected credit union friendly candidates.”

The Deduct-a-Buck and payroll deduction programs are automatic, painless, easy to administer, and, best of all, will help meet and exceed your credit union’s PAC goals.

If neither of those programs are a right fit for your credit union, we encourage all state chartered credit unions to consider making corporate contribution to their respective state PACs. Federal chartered credit unions cannot give to the state PAC, but may contribute to the CU-Vote Defense Fund.

In Alabama, the LSCU has a theme park consignment ticket sales program that every credit union can participate in that benefits ACULAC. Let’s make 2013 yet another recordbreaking year for the PACs and increase our voice in Montgomery, Tallahassee, and Washington D.C. If your credit union would like to get involved in PAC fundraising, contact Grassroots and Political Action Coordinator (Alabama) Blake Westbrook at blake. westbrook@lscu.coop, or Grassroots and Political Action Coordinator (Florida) Andy Gonzalez at andrew.gonzalez@lscu.coop, for further information.

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ADVOCACY

Overview of CFPB’s New Mortgage Lending Rules – Part 1

By Bill Berg, vice president, Compliance Training & Information, LSCU

This article will be part one of two that will cover these rules. Part one will cover higher priced mortgages and appraisals. Part two will cover the mortgage loan originator changes, escrow changes, and servicing rules.

The Consumer Financial Protection Bureau (CFPB) has issued new rules that relate to mortgage lending. Some of those rules went into effect this past June and dealt with the escrow requirements for high cost mortgages and changes to the mortgage loan originator procedures. On January 10, 2014, new rules that relate to a variety of mortgage issues will go into effect. (For definitions of each of these rules see page 13.)

Unless you sold loans to the secondary market, there was never a historical requirement to escrow loans until Dodd-Frank Wall Street Reform and Consumer Protection Act (the Dodd-Frank Act or Act).

Higher-Priced Mortgages Escrow requirements under the Truth in Lending Act (Regulation Z) implement certain amendments to the Truth in Lending Act made by the Dodd-Frank Wall Street Reform and Consumer Protection Act. A loan is a “higher-priced mortgage” if: ■■ APR is 1.5 percent above the Average Prime Offer Rate (“APOR”) if secured by a first lien ■■ APR is 2.5 percent above the APOR if secured by a first lien jumbo loan ■■ APR is 3.5 percent above the APOR for a loan in second lien position

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■■ ■■ ■■

Exemptions: 50 percent of its first lien mortgages must be within rural or underserved areas Assets are less than two billion Funded 500 or fewer first lien mortgages in 2012 Does not currently escrow its loans or credit union has only escrowed loans that qualified as higher-priced loans since April 2010

Rural or underserved areas are unlikely to be applicable to you.

Appraisals for Higher-Priced Mortgage Loans Joint Final Rule by NCUA, Federal Board of Governors, FDIC, and OOC changes the Truth in Lending Act and implements a new provision added to TILA by Dodd-Frank Act requiring appraisals for “higher-risk mortgages”.

Appraisals must be: ■■ Provided at application new notice ■■ Performed by a certified or licensed appraiser who conducts a physical visit of the interior ■■ Complete, containing all required elements ■■ Provided within three days of completion by internal staff and more than three days before the loan is closed Excluded loans include: qualified mortgages; HELOCs; new

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manufactured home; mobile home, boat or trailer; initial construction of a dwelling; temporary or bridge loans — 12 months or less — if the purpose is to acquire a member’s principal dwelling; and reverse mortgages.

In order to establish safe harbor, a credit union must: ■■ Order the appraisal properly ■■ Verify the appraiser is certified or licensed ■■ Verify the appraisal conforms to required elements ■■ Have no knowledge of any problems A credit union that does not satisfy the safe harbor conditions does not necessarily violate the appraisal requirements, but also does not benefit from its protections.

New Mortgage Rule Definitions ■■

■■

Equal Credit Opportunity Act – Appraisal Rules The disclosure and delivery requirements for copies of appraisals and other written valuations under the Equal Credit Opportunity Act (Regulation B), amending section 701(e) and 1002.14, are as follows: ■■ Credit union must apply appraisal requirements to first lien mortgage loans secured by a dwelling. This includes investment loans and business loans that are secured by a dwelling and manufactured and mobile homes ■■ Appraisal must be connected with an application for credit ■■ Credit union must prevent discriminatory appraisals ■■ Credit union must provide notice of right to receive a copy of appraisal (new notice) within three days of the application ■■ Credit union may waive the timing requirement, if appraisal is received, for providing the copies if provided the waiver at least three business days prior to the intended consummation or opening date, or if receive the copy at or before such consummation or opening ■■ If the transaction does not consummate or the account does not open, the credit union must provide the copies within 30 days of determining such failure to consummate or open ■■ Credit union must obtain a waiver for revised version, even within three days of closing

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■■

ECOA Appraisal Rule: Disclosure and Delivery Requirements for Copies of Appraisals and Other Written Valuations Under the Equal Credit Opportunity Act (Regulation B) amending section 701(e) and 1002.14 of Regulation B. Appraisals for Higher-Priced Mortgage Loans: Joint Final Rule by NCUA, Federal Board of Governors, FDIC, OOC changing Truth in Lending Act implement a new provision requiring appraisals for “higher-risk mortgages” that was added to TILA by the Dodd-Frank Wall Street Reform and Consumer Protection Act (the Dodd-Frank Act or Act) Higher-Priced Mortgage Rules: Escrow requirements under the Truth in Lending Act (Regulation Z) implement certain amendments to the Truth in Lending Act made by the Dodd-Frank Wall Street Reform and Consumer Protection Act High-Cost Mortgage Rules: High-Cost Mortgage and Homeownership Counseling Amendments to the Truth in Lending Act (Regulation Z) and Homeownership Counseling Amendments to the Real Estate Settlement Procedures Act (Regulation X), expanding the types of mortgage loans that are subject to the protections of the Home Ownership and Equity Protections Act of 1994 (HOEPA)

This article is designed to provide general guidance as these regulations are complex and lengthy. It is recommend that your credit union mortgage expert and/or attorney review these rules along with your specific procedures to ensure that you are in compliance. Questions?

Contact Bill Berg at bill.berg@lscu.coop or 866.231.0545, ext. 1028.

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Myra Toeppe Q&A Myra Toeppe will replace Region III Director Herb Yolles when he retires at the end of this year.

Toeppe is the NCUA’s current acting director of supervision in the Office of Examination and Insurance. She joined the NCUA in 2011 as associate regional director for operations in Region III. She has also served at the Office of Thrift Supervision and the Federal Home Loan Bank of Atlanta during her 25-year government career.

What are your thoughts on the overall state of credit unions in Region III? There are a lot of positive signs coming from credit unions in Region III, despite the fact that unemployment in the states we cover remains higher than the national average. We have seen improvement in delinquencies, which have leveled off, as well as stable earnings. Net worth of Region III credit unions is also stable.

Where are the areas the NCUA is concerned with credit unions?

At the top of the list of concerns for credit unions is interest rate risk. The net long term assets ratio continues to increase for Region III credit unions. Given the interest rate environment, investing long term may be an issue if credit unions focus on short term profitability. The NCUA is concerned that credit unions may not have appropriate ways to mitigate interest rate risk. This will be a focus in 2014.

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Other areas include concentration risk and risks associated with third party relationships, as well as due diligence over those third parties. Technology and cyber-security risk are also areas that need attention from credit unions. They must be diligent in assessing their risks and keeping up-to-date on any potential threats. Controls in these areas are important.

Smaller credit unions may have issues with succession planning, lending, and other operational issues. The NCUA’s Office of Small Credit Union Initiatives has developed a series of videos that can be viewed to help credit unions with these issues and training. The videos may be found at http://www.ncua.gov/ Resources/OSCUI/Pages/Videos.aspx.

Out of the Dodd-Frank legislation, there are many changes coming up to consumer regulations that credit unions need to prepare for. NCUA has its own YouTube Channel that covers these updates. If you are interested, the videos are at http:// www.youtube.com/playlist?list=PL--na5_ QagEgcWrUhCScyX6vNETjW9BS9.

Where are the opportunities for credit unions to help their members?

Credit unions exist to serve their members, who are the owners. Many of them may have no other access to affordable, secure financial services. Good customer service is based on communication, providing access, and staying focused on meeting members’ needs.

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Do they need a small business loan? Do you even offer that product? Do you have the expertise to do so? If not, help them find someone who can. Do they have needs that you are not meeting? How can your credit union capitalize on the economic recovery?

Finally, credit unions need to be able to market their services and even automate services to younger members to drive growth.

How important is it for you to get out and meet with Region III credit unions in person?

I consider it very important. I do not plan to be a regional director who only meets a CEO when a credit union is having problems. Meeting in groups is probably the best avenue for us to talk. I want to hear CEO concerns regarding interest rate risk mitigation, the examination and supervision function, and any other areas of concern. League events are one way to sit down and have these discussions.

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LSCU Legislator Profile

Congressman Alcee L. Hastings Alcee L. Hastings represents the state of Florida by serving as Congressman for District 20, which includes parts of Broward, Palm Beach, and Hendry Counties.

Congressman Hastings was first elected in 1992 and is currently serving his eleventh term in the Congress.

Appointed by President Jimmy Carter in 1979, he became the first African-American Federal Judge in the State of Florida, and served in that position for 10 years. He is also a long-time member of Brightstar Credit Union in Sunrise, FL.

How and why did you become interested in public service and politics in particular; and what led you to run for Congress?

It is my great honor and privilege to represent the people of Florida’s 20th Congressional District. Throughout my lifetime, I have worked tirelessly as a lawyer, federal judge, and now member of Congress to be a voice for those whose voices are too often unheard, and to have a positive impact on the lives of all Americans. I believe that we have a responsibility as a society to help the least of us, particularly underserved communities and vulnerable groups such as senior citizens, women, and children.

Serving in Congress offers lawmakers the tremendous opportunity to make a real difference by working together with the private and public sectors, as well as everyday citizens.

What are the most important issues you see facing Congress today?

At a time when many Americans are still struggling to find a job, keep their homes, and provide for their families, I remain committed to doing everything in my power to help middle class and working poor Americans

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get back on their feet. Congress today is faced with a number of significant issues, which include negotiating and passing a budget for FY 2014; addressing the sequester; moving forward with comprehensive education, financial, health care, immigration, and tax reform; passing critical legislation related to protecting the environment and investing in our nation’s transportation and infrastructure; and creating jobs. Furthermore, in this challenging fiscal environment, there is a critical need to strengthen and protect our nation’s social safety net programs.

What role do you see for credit unions in serving the people of Florida and how do you see them as part of the continued economic recovery?

Credit unions are critical to our nation’s economy, serving as a primary source of consumer credit for millions of Floridians, especially in underserved and rural areas, as well as for many local businesses. As our nation’s economy continues to recover, credit unions empower individuals and communities as a whole to realize new possibilities through sustainable economic growth. I am proud to support legislation in Congress that helps credit unions grow and better serve members in their communities,

while reducing their regulatory burden, such as: H.R. 719 – Capital Access for Small Businesses and Jobs Act, H.R. 688 – Credit Union Small Business Jobs Creation Act, and H.R. 749 – Eliminate Privacy Notice Confusion Act.

seek out partnerships with other community and industry stakeholders, such as local businesses, community banks, and trade associations, to collaborate on issues and initiatives of mutual interest.

You have been a big supporter of credit unions over the years. What about credit unions makes you feel so passionate about supporting our issues?

Credit unions have long met the needs of their members when traditional financial institutions simply did not. When it comes to increasing opportunities for middle class and working poor Americans to provide for their families, buy a home, or start their own business, I believe that equitable access to credit for all is key. This is particularly true for underserved and rural communities, which may not otherwise be able to obtain affordable credit and fully achieve their economic potential.

Is there anything you would like credit union advocates to know about you?

First of all, I would like to recognize and thank our nation’s credit unions for all that they do to not only help their members realize their aspirations, but empower Americans as a whole and drive our economy. As we continue working to implement comprehensive financial reform, I remain dedicated to doing everything in my power to maximize access to credit for consumers in a manner that is fair and equitable. If you have an idea to improve our nation’s financial system, or if I may be of any assistance, I welcome your input and stand ready to work with you. n

Congressman Hastings (green tie) listens to credit union representatives during Hike the Hill in Washington, D.C. Also pictured is Congresswoman Lois Frankel (R). This is her first meeting with credit unions.

If you could give one piece of advice to grassroots advocates for credit unions, what would it be?

I encourage grassroots advocates for credit unions to

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LSCU Legislator Profile

Representative Paul DeMarco Rep. Paul DeMarco has served in the Alabama House of Representatives since he was elected in a special election that took place on April 26, 2005. Rep. DeMarco is a partner in the law firm of Parsons, Lee, and Juliano P.C. He is past president of the Birmingham Bar Foundation and is also an active member of the chambers of commerce for Homewood, Hoover, Mountain Brook, and Vestavia Hills.

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How and why did you become interested in public service and politics in particular; and what led you to run for the Alabama House of Representatives and now United States Congress?

I think we can always work to improve the future for Alabama. I am a fiscal conservative with a proven record of representing the values of the people in my district. I feel a strong responsibility to represent those common sense, practical solutions in the statehouse. I have the experience and the passion to do the same in Washington.

With the 2014 Alabama Legislative Session around the corner, what are your top priorities? What would you like to see the Alabama Legislature accomplish in 2014?

I am focused on passing the Taxpayers’ Bill of Rights.

This will create more taxpayer-friendly procedures and ensure taxpayers are treated fairly through an independent process when it comes to hearing appeals. In addition, I plan to offer several bills to make it easier to grow business in Alabama.

What are the most important issues you see facing Alabama today?

Alabamians want limited government. The best ideas don’t come from places like Montgomery or Washington, but back home. I have a strong record of proven results in making government transparent and more accountable for the people. My job is to find ways to make government work for the people and not hinder their lives.

Credit unions are seeing an alarming increase in regulatory burden throughout Alabama. In your opinion, what can the Alabama Legislature and Congress do to help decrease over-regulation seen in the financial services industry?

The best policy is to get out of the way by cutting through all of the red tape. Credit unions know this

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well. Every dollar spent on complying with burdensome regulations is a dollar not used to benefit its members.

Credit unions are required to send tens of millions of privacy notices each year to members. Most of the time, consumers ignore them and don’t want to be bothered by all that extra mail. That is just one example. We must balance privacy rights with the need to reduce burdensome regulations.

What role do you see for credit unions in serving the people of Alabama and how do you see them as part of the continuing economic recovery?

People have always viewed credit unions as a safe haven. More than two million Americans joined credit unions in 2012. We need to have an honest conversation about regulations that hamper all of our financial institutions. The best policy is for government to get out of the way and free up Alabamians and the rest of the country to do business. With that kind of support, credit unions will be a key partner in growing our economy.

How important is grassroots advocacy in the legislative process? If you could give one piece of advice to credit union advocates, what would it be?

I always have an open door for the people of my district and the people working to lead Alabama to an even better future. I encourage everyone to be informed and let your voice be heard. My record shows we can always work together to find common sense solutions to improve the way of life in Alabama. n

CUNA President/CEO Bill Cheney speaking with Rep. Paul DeMarco (center) and LSCU’s Jason Cochran in Birmingham during one of Cheney’s visits.

“I always have an open door for the people of my district and the people working to lead Alabama to an even better future. I encourage everyone to be informed and let your voice be heard.”

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INITIATIVES

Uniting for Good Through Affiliation

By Laura Lee Vann, vice president, Cooperative Initiatives, LSCU

In the 2013 LSCU & Affiliates Member Survey, 95 percent of credit unions indicated that their credit union receives a good value for its LSCU dues investment. When the responses are viewed across asset categories, it is clear that credit unions of all sizes are realizing value from their LSCU affiliation. While the Small Asset Size (SAS) credit union program is an integral part of our member relations efforts, our member relations programs also include support and development of the 19 LSCU chapters, the Young Professionals Group, and financial education programs.

The Cooperative Initiatives team is focused on providing assistance to credit unions of all sizes and utilizes expertise from throughout the LSCU & Affiliates organization to assist you. We want to help you better meet the needs of your members.

Several credit unions shared information on the value they find in LSCU membership and how the LSCU team has helped them on a day-to-day basis. For Keys Federal Credit Union in Key West, FL ($120 million in assets and 9,597 members), a critical issue was a lack of resources directly related to the credit union’s financial situation. “We cannot even begin to express the unbelievable support and benefit that being a member of the League has been to Keys Federal,” said CEO Scott Duszynski. “During the last three years, we have continued to do everything possible to eliminate expenses, have team

members perform double duties, cut travel/ training, and stayed focused on doing the best we can for our members and potential members. During the course of our recovery, the League has never wavered from standing by our side.” Duszynski also mentioned the value of on-site training and training via webinars.

Duszynski received a scholarship from

the Southeastern Credit Union Foundation (SECUF) to attend the Annual Convention & Exposition in Orlando and noted the value of networking with credit union peers, as well as vendors. As a result of connections made at the AC&E, the credit union signed new vendor relationships that enabled the credit union to save more money.

“I cannot stress enough the value,

“I cannot stress enough the value, integrity, and true partnership that LSCU has given to Keys Federal Credit Union over the last few years and we will not forget it.” >> Scott Duszynski, CEO, Keys Federal Credit Union 20

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integrity, and true partnership that LSCU has given to Keys Federal Credit Union over the last few years and we will not forget it,” said Duszynski. “We look forward to many, many more years with our valued partner.”

Bob Beskovoyne, CEO of Martin Federal Credit Union in Orlando ($105 million in assets, 12,748 members), also mentioned the support of the League during difficult financial times. “League membership has always been invaluable to Martin Federal Credit Union,” he said, adding that the League’s support during the economic crisis reinforced the cooperative spirit and contributed to the credit union’s survival.

LSCU members value their ongoing interaction with the LSCU team and recognize the League is working on their behalf every day. “Our credit union appreciates the good service we receive from LSCU staff members on a daily basis, as well as their responsiveness and willingness to help when we have more specialized problems,” said APCO Employees Credit Union CEO Merrill Mann (APCO Employees Credit Union is located in Birmingham and has $2 billion in assets and 67,911 members). Linda Walker, CEO of Riverdale Credit Union in Selma, AL, echoed Mann’s comments. “The League staff has always been there for our credit union. I simply cannot imagine operating Riverdale Credit Union without the League. They have guided us through many situations and always offer us professional advice,” said Walker. (Riverdale Credit Union has $63 million in assets and 8,972 members.)

Deborah Dean, assistant manager at Opp-Micolas Credit Union in Opp, AL ($13 million in assets, 2,199 members) is particularly appreciative of the SAS program and the $500 SAS initiatives account

provided to each credit union under $50 million in assets to use toward an LSCU, LEVERAGE, or CUNA educational event, product, or service. “The SAS Initiatives account really comes in handy when budgets are tight. It truly helps out on educational expenses and audit expenses, as you now have to audit everything,” Dean said. Susan Cantrell, manager of First Coast Federal Credit Union in Jacksonville, FL ($7 million in assets with 2,002 members), also noted the value of the $500 SAS Initiatives account.

“As a small credit union, we are feeling the pinch on our bottom line. Thanks to the $500 Initiatives account, we were able to reduce the expense of our BSA audit,” said Cantrell. Connie McCool, CEO of City Credit Union in Tuscaloosa, AL ($15 million in assets, 2,741 members) also expressed her satisfaction with the SAS program, noting that the Cooperative Initiatives team provides interesting and helpful planning session facilitation and board training.

Everglades Federal Credit Union is a new affiliate of the LSCU and has immediately experienced the value of LSCU membership.

“Everglades Federal Credit Union joined LSCU in June of this year,” said CEO Marta Smith. “Our credit union was going through a lot of major changes in staff and management. I had just been promoted to CEO in April. Although I have been at the credit union for 14 years, I did not get a chance to be trained for the CEO position.

The League partnered me with one of their staff who had been a (credit union) CEO for 14 years. He came in and worked with me for a week. I learned so much, but most importantly, it was a tremendous boost for my confidence. ” Smith said Everglades Federal Credit Union has implemented several new loan

LSCU dues invoices for 2014 and affiliation materials were mailed in late November. If you have any questions about the value of affiliation and how your credit union can better utilize the resources available through the LSCU & Affiliates, contact LSCU VP, Cooperative Initiatives Laura Vann at 866. 231. 0545, ext. 2181 or laura. vann@lscu. coop.

products that she learned about at the LSCU Annual Convention & Exposition and that these new products have helped improve the credit union’s bottom line. “The League has been so valuable for Everglades Credit Union,” she added.

Jerry Bolduc, CEO of Monroe County Teachers Federal Credit Union in Key West, FL ($20 million in assets, $1,725 members), expressed his credit union’s appreciation for the League’s support in helping them assist their members. He noted the value of training and networking, stating that networking keeps the credit union “up to date on the latest and greatest ideas that keep credit unions way ahead of other financial institutions when it comes to providing the best services available at the most efficient cost possible.”

Bolduc added, “We feel that the LSCU is the most valuable ally we could have when it comes to people helping people!”

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INITIATIVES

Number of Financial Counselors Continues to Grow in Alabama and Florida Via REAL Solutions Enhanced FiCEP This year, LSCU & Affiliates debuted the Financial Counseling Solutions enhanced Certification Program REAL version of the Credit Union Financial Counseling Certification Program (FiCEP) to certify credit union financial counselors. At the end of the first program, there are now more than forty-five certified credit union financial counselors across Alabama and Florida.

This is an ongoing partnership between NCUF/REAL Solutions, CUNA’s Center for Professional Development (CUNA CPD), the League of Southeastern Credit Unions (LSCU), and Alabama and Florida credit unions to train staff that are then able to give professional financial counseling and education to members and potential members throughout the state.

The Southeastern Credit Union Foundation provided initial seed money to implement the program, as one of its core areas of focus is financial education. LSCU has marketed the program to credit unions and proctored student exams, while the League’s Cooperative Initiatives department has led the charge to recruit students and to make the proctored testing as easy for students as possible.

Students used the CUNA CPD’s FiCEP to study for their Credit Union Certified Financial Counselor certification. CUNA staff graded all tests and issued students with their certificates. Mark Lynch, field coach for REAL Solutions, conducted eight tutorial webinars and two face-to-face training days.

“The FiCEP program is and will be a great tool for me as a branch manager and loan officer,” said Ben Bradley, branch manager for Army Aviation Center Federal Credit Union. “I now have more detailed knowledge and a reference point of how to better assist my members who need assistance or who are just at a loss of what to do next.”

CUNA

Making Strides Nationally In the past two years, REAL Solutions has worked with 13 state credit unions leagues and has completed ten programs.

Four programs are currently in progress and two are scheduled to commence in the next month. Each program takes around five months to complete.

In addition to assisting students to achieve their certification, REAL Solutions places emphasis on developing a counseling and education

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plan, as well as tracking, measuring, and reporting the activities and the outcomes of their programs.

“FiCEP is a great program to help credit union staff counsel members to better prepare for their future and to assist when they are faced with financial difficulties,” said Lois Kitsch, NCUF REAL Solutions program director. “That is a great extension of the credit union difference and the more counselors that are certified, the more consumers can achieve financial freedom.”

LSCU is currently registering students for the 2014 class, which will run from February through May. Credit unions interested in having staff trained to become financial counselors should contact Adena Whitman at Adena.whitman@lscu.coop.

INITIATIVES

Credit Union Young Professionals Meet to Explore Award-Winning Financial Education Television Show

By Adena Whitman, senior member relations consultant, LSCU

On November 21, young professionals from credit unions across Alabama and Florida met in St. Petersburg, FL, to learn about Biz Kid$ and how to use it in the credit union financial education outreach.

This opportunity to come together and get hands-on instruction for this resource was incredible. Receiving a grant from the National Credit Union Foundation enabled the League to show the young professional group how to make use of the show and its accompanying tools.

What is Biz Kid$? It is a national financial education initiative based on an Emmy Award-winning public television series about kids, money, and business. The series includes 65 episodes and reaches one million viewers per episode.

Using a clever blend of entertainment and education, each Biz Kid$ episode shows kids how to make and manage money by introducing concepts of financial literacy and entrepreneurship. To keep young viewers engaged, the series includes a fast-paced mix of direct education delivered by young actors, sketch comedies, animation, and stories featuring real life young

Why Financial Education?

■■

■■

32 percent of high school seniors use credit cards...yet 52 percent did not know that paying off a credit card more slowly results in higher finance charges.

80 percent of teens think it is important to have a lot of money in life...yet fewer than 50 percent consider themselves knowledgeable about how to budget money, how to pay bills, or how credit card interest and fees work.

entrepreneurs. The show is complemented by a resource rich website, lesson plans, outreach activities, and a monthly electronic newsletter.

While the series is not free, it is discounted for credit unions and affiliates and the teaching materials are available as well as online. It is anticipated that the group will bring the information back to their chapters and show others how to use the materials.

The workshop agenda featured Danielle Brown, a contractor for the National Credit Union Foundation, who walked the attendees through the uses, best practices, and lesson plans for the show. In addition, each LSCU chapter will receive a Biz Kid$ starter kit to use in its area.

Extensive Online Resources www.bizkids.com ■■ Free Curriculum & Family Activities for Every Episode ■■ Spanish Curriculum for Select Core Episodes ■■ Online Video Clips & Games www.wxxi.org/bizkids ■■ Teacher Professional Development Kit; Outreach & Activity Ideas

Right now, the series is airing on public television stations across the country and on stations around the world. The series has reached 98 percent of the United States and the website has welcomed visitors from more than 60 countries.

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Together with our members, we have built one of the strongest corporate credit unions in the nation

FOUNDATION

SECUF to Utilize Fair Share Contribution Option

By Leonard Parkhurst, director, Southeastern Credit Union Foundation The Southeastern Credit Union Foundation (SECUF) continues to focus on advancing its efforts to promote financial education, provide professional development scholarships, and deliver financial relief and assistance to credit unions and their members in the wake of natural disasters. In addition to these programs, we continue to assist credit unions with raising funds for Children’s Miracle Network Hospitals through the CU4Kids program.

As efforts to advance our mission increases, so does the need for financial support. In order to ensure the continued progression of these valuable programs, SECUF relies on support from several areas.

The most important area of support comes from our affiliate credit unions. Credit unions understand that SECUF is their foundation and is working to benefit their members.

One of the most successful ways for credit unions to provide support to the foundation is through a fair share contribution. This option allows credit unions to participate in the Foundation’s ongoing efforts of education, disaster relief, and charitable giving through an annual fair share contribution based on each credit union’s membership size. A five cents per member fair share amount was utilized by both the Alabama Credit Union League and Florida Credit Union League prior to consolidation and proved to be a successful and amenable method of providing support to the Foundation.

Beginning in 2014, the Foundation will be restoring the Fair Share Contribution option and credit unions will be asked to consider making an annual donation to the Foundation at the rate of five cents per member. A letter explaining the Fair Share Contribution and indicating each credit union’s fair share amount was included in the 2014 dues packet that was mailed in December. A successful Fair Share program will significantly impact the SECUF and allow us to focus on our mission of serving as a catalyst for credit unions to collectively effect change through charitable giving and education.

Credit unions seeking additional information on the Fair Share Contribution should contact Leonard Parkhurst at leonard.parkhurst@lscu.coop.

A successful Fair Share program will significantly impact the SECUF and allow us to focus on our mission of serving as a catalyst for credit unions to collectively effect change through charitable giving and education.

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EDUCATION

Another Successful Leadership Development C The LSCU & Affiliates Leadership Development Conference (LDC) was held Nov. 6-8, in Point Clear, AL. It began early Wednesday morning with the Putt for a Purpose golf outing, ramped up in the afternoon during the director’s institutes and the asset sized roundtables before ending with two hours in the sold out exhibit hall.

The asset sized roundtables were broken into three categories: under $100 million, $100 million to $500 million, and over $500 million. The conversations in each session were a little different, but each elicited excellent discussions among credit unions.

One of the hot topics was NCUA examinations, as well as retaining top talent.

The Putt for a Purpose golf outing saw more than 50 golfers hit the links to help the Southeastern Credit Union Foundation (SECUF).

The proceeds will help in the professional development of credit union officials in the form of grants and scholarships. Bill Adams of Naheola Credit Union won the long drive, while Bob Roy of APCO Credit Union won the putting contest.

More than 250 attendees spent two hours browsing the exhibit hall and meeting with vendors for solutions. The quaint exhibit hall at the LDC was the perfect opportunity to spend quality time at each booth.

The core of the LDC was Thursday with the Opening General Session, education sessions,

Family Security Credit Union’s Shane Nobley (center) attends one of the education sessions.

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the Governmental Affairs Luncheon, and the final day of the exhibit hall. The day equipped attendees with tangible information to bring back to their credit unions.

LSCU & Affiliates President/CEO Patrick La Pine welcomed attendees and provided a League update and the latest on comprehensive tax reform. LEVERAGE partner CO-OP Financial Services CEO Stan Hollen provided some remarks on the future of card services and the next generation ATMs that include shared branching. NCUA Region III Director Herb Yolles gave an overview of the credit union industry. He had the first look at third-quarter data and showed Alabama credit unions have $18 billion in assets, while Florida credit unions have $47.1 billion. He presented a graphic that illustrated that loans were up nationally, as well as in Alabama and Florida.

He said auto loans were showing major signs of improving. Yolles provided a look at the agency’s top regulatory concerns and it included PCA risk on net worth and stress testing.

Alabama Lt. Gov. Kay Ivey spoke at the Governmental Affairs Luncheon. She told

Conference...

attendees that the current administration stressed three keys: streamline government without raising taxes, create jobs, and maintain essential services. She said they have done all three, and Alabama is a much better state today than four years ago.

Many of the educational breakout sessions were standing room only, including the regulatory roundtables and the healthcare session. The social media session provided many attendees with new ideas on ways to improve their communications with members.

The exhibit hall featured art work from the guest tour. Attendees browsed the art, while speaking with vendors and learning more about their products.

The LDC wrapped up with two sessions Friday morning. The first was the CUSC of Alabama Annual Meeting and the second was the Closing General Session.

Body language expert Jan Hargrave provided the keynote address. She brought Corporate One FCU CEO Lee Butke on stage to talk about handshakes. She said palms up is a sign of respect where a finger pointing means the person is looking for control. Attendees enjoyed

her look at how to spot a liar, including someone that wipes their face or ears too much with their left hand. A right hand on the heart is a genuine sign of respect. Hargrave also talked about how she often is asked to analyze presidents’ body language or a celebrity in the news. Attendees left with fun ways to look at their staff and members, not to mention their friends.

Credit Union Service Center President/COO Craig Beach spoke during the CUSC Annual Meeting. He said with CO-OP’s 30,000 ATMs and 5,000 shared branch locations, no other financial institution can compete. It also shows credit unions’ unique nature. The list of shared branching locations, nearly 5,200, is just behind three large banks for the number of locations.

For handouts from the sessions (if available), check out the handouts section of the LDC mobile app or the particular session description on the LDC website (www.lsculeadership.com).

For more pictures from the LDC, visit the LSCU Facebook page: search League of Southeastern Credit Unions.

PHOTOS FROM (LEFT TO RIGHT) LDC keynote speaker and body language expert Jan Hargrave shows Roland Buffington of Alabama State Employees’ Credit Union how to spot love body language.

Bob Roy of APCO Credit Union won the putting contest in the Putt for a Purpose golf tournament.

Some of the LSCU gang learns how to pose properly with body language expert Jan Hargrave (center).

Alabama Lt. Gov. Kay Ivey talks with Riverdale Credit Union CEO Linda Walker.

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EDUCATION

Wrapping Up Education In 2013, Moving Forward To 2014

By Teresa Gray, senior director, Education, LSCU As LSCU & Affiliates wraps up another year of education, we would like thank all CEOs, directors, staff, sponsors, and vendors that have participated in events this year. Whether you attended a workshop or conference, sponsored a workshop or conference, or exhibited at one of our signature events, your participation is greatly appreciated. We pride ourselves on listening to our members and their educational wants and needs and strive to provide the best possible speakers, education tools, and events to meet those needs.

Professional development is an investment and should be considered a priority for all credit union staff and directors. For

continued success, volunteers and staff need the education, training, and networking opportunities.

We encourage you to plan your training schedule now and put our events on your calendar for 2014. We have more than 30 faceto-face conferences and workshops, as well as 100-plus low-cost webinars on operational and compliance topics.

Through our connections with our trusted industry experts and combined knowledge of the credit union industry, we have our members’ best interest in mind when putting together LSCU’s events.

We look forward to continuing to serve and work with you to provide top-notch speakers, up-to-date topics, and sessions that will ensure you have everything you need to make informed decisions in your day-to-day responsibilities at your credit union.

Here is what you said: “I appreciate the high quality “The Leadership Development programs, speakers and Conference offers a great events that LSCU puts opportunity to network with together each year that others, whether you are a helps our credit union stay CEO, manager, or volunteer. connected. Collaboration has The agenda provides a variety always been a hallmark of of topics in many formats: the credit union movement. roundtable discussions, I believe the League helps governmental affairs, breakout smooth our way and sessions, and even an exhibit encourages credit unions to hall. A worthwhile conference work together in our common to attend!“ mission — to serve our own >> Mary Ott Wood | President/CEO, Florida West Coast Credit Union members well.” >> Merrill Mann | President/CEO, APCO Employees Credit Union

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“I can’t imagine our credit union without the assistance of LSCU. Their events are well-planned, informative, and a great networking opportunity. I always come away re-energized and with a new understanding of my next move. Great job, LSCU staff!” >> Linda S. Walker | Manager, Riverdale Credit Union

EDUCATION

Upcoming Learning Opportunities Check out the learning opportunities for 2014 and mark your calendars. More details on each event can be found online at www.lscu.coop.

Click the Education tab then Events Calendar.

January 2014

April 2014

August 2014

24-25

8

3-6

10

Southeastern Supervisory Committee Conference, Point Clear, AL

20-22

Southeastern Credit Union Managers Association (SCUMA) Annual Meeting, Destin, FL

LSCU Quail Hunt FEDPAC Fundraiser, Town Creek, AL

February 2014 4-5

11

Alabama Credit Union Association State Governmental Affairs Conference (ACUA State GAC), Montgomery, AL LSCU Bank Secrecy Act Workshops, Jacksonville, FL

13

LSCU Security & Robbery Training Seminar, Birmingham, AL

18

LSCU Small Asset Size Credit Union Conference, Orlando, FL

19

LSCU Small Asset Size Credit Union Conference, Ft. Lauderdale, FL

20

LSCU Small Asset Size Credit Union Conference, Birmingham, AL

23-27

CUNA Governmental Affairs Conference, Washington D.C.

March 2014

11

LSCU Security & Robbery Training Seminar, Tallahassee, FL

18-19

LSCU IRA Essentials & Advanced Training Seminar, Birmingham, AL

20-21

LSCU/CUES Credit Union Executive Dialogue, Bonita Springs, FL

25-26

Florida Credit Union Association State Governmental Affairs Conference, Tallahassee, FL (FCUA State GAC)

LSCU Spring Regulatory Compliance Update Seminar, Tallahassee, FL LSCU Spring Regulatory Compliance Update Seminar, Birmingham, AL

22

LSCU Disaster Recovery Conference, Mobile

24

LSCU Disaster Recovery Conference, Jacksonville, FL

TBD

LSCU Chapter Leaders Retreat, Location TBD (invitation only)

May 2014 6-7

LSCU OFAC & Bank Secrecy Act School, Birmingham, AL

June 2014 6-13

Southeast CUNA Management School, Athens, GA

September 2014

9

LSCU Fall Regulatory Compliance Update Seminar, Tallahassee, FL

11

LSCU Fall Regulatory Compliance Update Seminar, Birmingham, AL

24-25

LSCU OFAC & Bank Secrecy Act School, Tallahassee, FL

October 2014 7-8

LSCU Collections & Bankruptcy School, Birmingham, AL

21-22

LSCU Lending School, Birmingham, AL NFCDCUs Community Development Workshop, Location TBD

11-14

LSCU Annual Convention & Exposition, Orlando, FL

TBD

28-2

America’s Credit Union Conference, San Francisco, CA

November 2014

July 2014 13-16

Southeast Regional Director’s Conference | Savannah, GA

16

LSCU Bank Secrecy Act Workshops, Mobile, AL

16

LSCU Bank Secrecy Act Workshops, Huntsville, AL

16-17

4-7

Southeastern Leadership Development Conference, Destin, FL

LSCU Credit Union Philosophy in Action Workshop, Orlando, FL

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COMMUNICATIONS

Are Your Employees Hearing What You Are Saying?

By Amy Jowers, director, Communications, LSCU Ever feel that your employees are ignoring you? Or, maybe, that they do not understand the message you are trying to get across?

If so, it might be time to revisit how you are communicating. Even if you feel you are an effective communicator, the group or individual to whom you are communicating may not.

According to a study conducted by Leadership IQ, a top-rated research and management consulting firm, while 93 percent of leaders thought themselves to be effective communicators, only 11 percent of employees thought their bosses were effective communicators.

Quite a skewed view of how effective each party views such communication, isn’t it?

When it comes down to it, good communication is all about clarity.

As a leader, if you do not understand or know how to communicate the desired outcome, how can your audience—whether it is your directors, your staff, or a member—effectively accomplish the goal? Effective communication requires that both the sender and receiver have the same understanding of the message the sender intends.

“Communication is the most critical competency that leaders need to succeed today, and most workplace problems are the result of poor communication,” says author and leadership expert David Grossman.

Basically stated, good staff communication is essential to business success. Employees who do not know what is expected of them rarely perform to their potential.

Grossman goes on to say that many benefits of effective communication include improved relationships, more effective and efficient work, better problem solving, increased employee engagement, and the ability to recruit and retain high-potential employees.

Below are some common communication mistakes made by leaders. Do any of them sound familiar?

■■ Being overconfident about their communication skills (see study result in the first paragraph) ■■ Waiting to communicate until they think they have all of the answers, while the “information vacuum” is filling with messages from other sources, and employees are most likely thinking in terms of worst-case scenarios ■■ Thinking they have no time to communicate when, in fact, “communication done well will often save them time” ■■ Viewing communication as a separate skill as opposed to being integral to the performance of individual and team goals

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We should all know successful communication is a two-way street.

What you may not realize is that if management is doing all the talking, employees tend to tune out. It is important to understand that the people in the “trenches” at the credit union often have the best suggestions for improving it and are often the first to see danger approaching.

Employees will keep quiet if they see that the culture and management discourage, if even subtly, risk taking, or show hostility to questions. Generally, a leader needs to be honest, show respect to employees, and work on building trust. If he or she does none of the above, employees tend to put up a filter and what is said does not matter.

Four Communication Style Types: When talking to a staff member or a group, whether a board meeting, a staff meeting, or your annual membership meeting, consider these four ways people like to give and receive information.

■■ The Intuitive type refers to those people who are not terribly emotional, but who are quite free-form. They like to cut to the chase: what’s the real value you are bringing this person today?

■■ The Analytical type refers to those people who prefer things unemotional but linear. They want “just the facts.”

They do not want to hear a lot of warm-and-fuzzy feeling words, instead just give them the numbers and data they need and want.

■■ The Functional type refers to people who generally like their communication to be emotional and linear. They like to have control of the process so it is always best to move in a linear fashion: from A, to B, to C and then follow through right to the end.

■■ The Personal relater is both free form and emotional. They want the warm-and-fuzzy emotional approach. Dive right into all the details; they need a more interpersonal connection.

Tip: In order to communicate to each style when talking to a group, Leadership IQ founder/CEO Mark Murphy says to begin addressing the intuitive types, then speak to the analytical types, then to the functional types, and close by speaking to the personal types.

NEWS

League News Cheney Visits Provide Open Dialogue with Credit Unions In October, CUNA President/CEO Bill Cheney and LSCU & Affiliates President/CEO Patrick La Pine traveled Alabama and the Florida panhandle to talk with credit union CEOs, staff, directors, and lawmakers. They spoke with 37 CEOs, representatives from 43 credit unions, and nearly 200 people through individual visits and seven chapter meetings.

Throughout the visits, Cheney and La Pine had great conversations. Each chapter meeting was similar; Cheney presented an overview of the movement from a national perspective. He talked about how CUNA was attacking certain issues and what they were doing on a daily basis. The credit union tax exemption is the top priority for CUNA and the League. Cheney also talked about meeting with the U.S. Treasury to educate them on the credit union tax status.

Many questions were asked about the NCUA and the Consumer Financial Protection Bureau (CFPB).

CUNA is working with the CFPB on its new mortgage rules, and there have been many conversations between Cheney and CFPB Director Richard Cordray.

CUNA is also very involved with the NCUA and watches them closely. Cheney said the national examination survey will open again in December. It does not have to be negative, but the feedback does help the NCUA and the examination process.

At the Birmingham meeting, two state lawmakers attended. Rep. Paul DeMarco (R-Birmingham) and Sen. Slade Blackwell (R-Birmingham) got a chance to talk with Cheney and La Pine. Both lawmakers gained a greater understanding of the national credit union perspective and also got a chance to speak with their local credit unions.

This is the third straight year CUNA President/ CEO Cheney has toured Alabama and Florida. If you were unable to attend, make plans to next time as this is such a good time to provide feedback on national issues and concerns you might have with CUNA. n

TOP: Cheney gives an overview of CUNA to the attendees at the Tuscaloosa meeting.

MIDDLE LEFT: Listerhill Credit Union President/CEO Brad Green sits down with Cheney to talk at the NE Alabama meeting.

MIDDLE RIGHT: (l to r) Riverdale CU Manager/COO Linda Walker, Alabama State Emp. CU CEO Ned McHenry and Alabama Rural Electric CU Manager Jane Boysen, listen as Cheney speaks.

BOTTOM RIGHT: (l to r): Mobile Educators CU President/CEO Tina Williams, Gulf Coast FCU Chief Compliance Officer Pam Cooks, Cheney, and Navigator CU Business Development Officer Lora Michael at the Mobile meeting.

BOTTOM LEFT: Pen Air President/CEO Stewart Ramsey and CUNA’s Cheney exchange cards at the Mobile meeting.

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INDUSTRY

Healthcare Changes and Your Credi

By Anita Fumaria, director, HR Services, LEVERAGE

Unless you have not watched TV news, read a newspaper, or surfed the web in the past few months, you know that there is a new national healthcare law in effect. The Patient Protection and Affordable Care Act (PPACA), also known as Obamacare, was signed into law on March 23, 2010. Containing more than 1,000 pages, the law is the most comprehensive change in health care regulations since the passage of Medicare and Medicaid in 1965.

With a long term goal of reducing the growth of healthcare spending, the Act purports to cost up to $1.1 trillion dollars over the next 10 years. Although Obamacare’s net costs are in the trillions, the law is supposed to reduce the growth in health care spending by tens of billions each year, reduce health care costs for many Americans, help to insure tens of millions of uninsured, and is estimated to result in an overall net decrease of the national deficit.

According to the Congressional Budget Office Report, the Act is projected to cut the national deficit by more than $200 billion

According to the Congressional Budget Office Report, the Act is projected to cut the national deficit by more than $200 billion during its first ten years and more than $1 trillion over the next two decades.

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during its first ten years and more than $1 trillion over the next two decades.

Individuals and businesses will be impacted in many ways as the full effects of the changes are realized over the next few years. No one really knows how the changes will impact the cost of premiums, types of coverages, policy terms, and many more variables.

Historically, credit unions, as an industry, have enjoyed offering some of the best-inclass health insurance benefits and have paid for well above average of the premium costs for those benefits for their employees.

According to the August 2013 Employer Health Benefits Survey conducted by The Kaiser Family Foundation and the Health Research & Educational Trust (Kaiser/HRET) only four percent of small firms (1 – 199 employees) contribute more than 50 percent of the premium cost for health benefits for their employees. While I do not have an actual survey of credit unions to compare this too, in my 13 years of exposure to credit union benefit programs, I have not actually found one credit union that contributed less than 50 percent, the majority contributing more than 80 percent of the cost.

This trend is actually good news for credit unions as it relates to the new healthcare regulations because the basics of the changes as they relate to employers is that employers are now mandated to provide affordable health insurance to their employees and that coverage must contain certain essential benefit elements. The good news is most, if not all, credit unions are already in compliance with these new requirements and are already accustomed to paying the costs associated with the level of coverage and the contributions required to

it Union make the plans affordable as defined by the new law.

The essential benefits as required by the Act are listed below: ■■ Emergency services ■■ Hospitalizations ■■ Laboratory services ■■ Maternity care ■■ Mental health and substance abuse treatment ■■ Outpatient, or ambulatory care ■■ Pediatric care ■■ Prescription drugs ■■ Preventive care ■■ Rehabilitative services ■■ Vision and dental care for children In recent discussions with more than 30 credit unions of varying sizes throughout Alabama and Florida, there was not one credit union that was not already providing this level of benefits to its employees.

The other major new requirement is that the employer portion of the premium must be “affordable.” Affordability is defined as follows: ■■ Employer pays at least 60 percent of health insurance premium.

■■ Employee does not pay more than 9.5 percent of annual income.

Example: 9.5% Percent x $25,000 Annual Income = $2,375 Maximum Employee Pays $2,375 Maximum Employee Pays — 12 months Divided by months in year $198.00 Amount per month

A handful of credit unions in Alabama and Florida have received their new premium rates for 2014—most have been within normal increase rates of five percent to 15 percent.

Again, most, if not all credit unions, are already contributing well above the affordability level required by the new regulation.

The biggest concerns on credit unions’ minds with the new Act are what long-term impact will the changes have on premium costs overall. A handful of credit unions in Alabama and Florida have received their new premium rates for 2014—most have been within normal increase rates of five percent to 15 percent. Some market predictions for increases have been as high as 40 percent!

That has not been the case thus far with credit unions—but many are concerned the largest impact will not be realized until 2015.

So, what should credit unions be doing now? If your credit union has 50 more full-time equivalents (defined as employees working more than 30 hours per week): ■■ Ensure that your plan is offering the essential benefits required by the Act ■■ Ensure that the cost of the premiums to employees does not exceed 9.5 percent of their salary and that you are covering at least 60 percent of the premium ■■ Limit Flex Spending Accounts to $2,500 (new maximum limit imposed in the Act)

■■

■■

■■

Provide written notice to employees (deadline was Oct. 1, 2013) that they are eligible to shop for alternative coverage in the new web-based Health Insurance Marketplace Ensure you can track hours worked by employees Check to see if the Health Care Marketplace is an option for your credit union (if less than 100 employees)

Stay tuned for updates. No one has a crystal ball.

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INDUSTRY

Make a Smooth Move with a Moving Professional One of the biggest headaches a credit union can encounter is moving offices or building a new branch. There are so many moving parts that just project managing the move or construction is a full time job.

The League moved its Tallahassee office in mid-December across town. FaciliNet, a full service real estate solution company based in Southfield, MI, helped the League plan the move, as well as oversaw the construction of a build out area in the new office space.

LSCU & Affiliates President/CEO Patrick La Pine began working with FaciliNet to see the most efficient way to use the existing Tallahassee office. When the opportunity came to move to a new location, FaciliNet worked with the League on a plan to best use the new space, as well as make the transition for the Tallahassee staff as seamless as possible. La Pine knew that moving an entire office that has been at the same location for nearly 30 years could be an overwhelming proposition for the staff.

“Any time you are moving you want it to be as easy as possible. If the League had self- managed the process, it would have been much more difficult. What FaciliNet does very well is manage all of the details,” said La Pine.

Those details include anything from the proper way for staff to pack the moving bins for their area, to how to properly plan for the moving of furniture, and the how that furniture will be featured in the new space.

Many credit unions that are considering moving branches or headquarters can get caught up in the details and lose sight of timelines and other communications that can bog down the relocation. Bob Nagle is principle owner of FaciliNet, and he says companies that try to manage their

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own relocation open themselves up for headaches.

“There are hundreds of small details that we have experienced on managing relocations that we review as a standard project practice. Most companies would not have a clue what to review. Items such as dedicated circuits, proper plug types, furniture orientation, and proper building security are just a few of the items that are normally overlooked in a self-managed move,” said Nagle.

Another area of FaciliNet’s Bob Nagle (left) discusses packing tips with LSCU’s Leonard Parkhurst. standard practice for FaciliNet is and are considered visible items. The items communication with the client. Every piece that you don’t see such as internet/phone of the puzzle is not only communicated on connections, network assets, and other a regular basis, but plans, budgets, and IT-related items are the major fail points in a drawings are securely housed on FaciliNet’s relocation project. No matter how well your website so the client can access them and furniture looks or if you have the new coffee have the flexibility to comment during every machine in the café area, if your phones and phase. For the League, this was important computers do not work on Monday morning, as the new Tallahassee office included a the project is considered a failure,” said build-out that had various pieces that were Nagle. each very important. Nagle says constant For credit unions planning a relocation, communication is a must, but that attention using outside help is a must to make the to detail will ultimately make the move move smooth, ease the burden on staff, successful. and, most importantly, keep services to the “Items such as furniture and contents membership flowing without interruption. are very visible and are always easier to manage because people see them every day

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EXPERIENCE THE SHOW BEFORE THE SHOW! The 2014 LSCU & Affiliates Annual Conference & Exposition (AC&E) is months away, but you can visit the exhibit hall today. Now available is the 2014 Virtual Exhibit Hall that provides information on the 2014 exhibitors and sponsors.

This is a great opportunity to plan and locate the vendor partners you want to visit at the 2014 AC&E. Gain insight on the products and services vendor partners are offering and learn more about their organizations by visiting www. lscuconvention.com and clicking on the 2014 AC&E Virtual Exhibit Hall. Check back frequently, as the exhibit hall is updated every week with new registrations.

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LEVERAGE

Identity Theft

Help Your Members Feel Secure Online

By Kevin Lytle, vice president, Innovation & Business Development, LEVERAGE Credit unions have a great value proposition with their membership. They are trusted financial institutions that have proven over time to have their members’ best interest in mind. With today’s world being internet driven, credit unions have opportunities to once again reinforce their value proposition to members.

By offering an identity theft tool, credit unions will once again show that they care about more than just deposits.

Identity theft is growing exponentially each year. In 2012, more than 12 million consumers were victims of identity fraud. This was one million more consumers than the year before. Most of the fraud seems to come from credit card numbers once there has been a data breach. It can be any card, not just credit union or bank cards, but store-branded cards, as well. Consumers lost more than $4.9 billion to fraud in 2012. It is definitely an epidemic that is only increasing.

Credit unions get calls from members frequently stating that their account has been compromised or their credit card number stolen.

In the most extreme cases, their social security number has been stolen and an entirely new identity has been established without their knowledge. Every day someone has to deal with an account compromise or identity theft. In most cases the problem could have been avoided. Here’s how it can happen: Roger always uses the same email and password combination for online accounts so he can easily remember his credentials. One morning he received an email stating that his favorite online shoe retailer, Magicshoes.com, experienced a data breach and his login credentials had been compromised. Little did he know, by the time he learned about the breach, his information had already been sold on the black market, and his accounts at financial institution and his credit cards were infiltrated using the same login information. Not only did Roger not realize that he was at risk everywhere that the stolen credentials were used, his financial institution and his credit card company did not know that the Magicshoes.com’s breach also affected them and their customers.

If this were to happen at a credit union, how would it help?

Many times it might not be brought to the credit union’s attention until the member calls them. LEVERAGE is looking at a solution to where the credit union can offer its members an identity theft product that monitors the members’ activities and alerts them when there is a possible compromise. This technology monitors thousands of websites and millions of data points using a variety of data gathering techniques such as chat room monitoring, spidering/

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There are a few ways to make it more difficult to be a victim of online fraud or identity theft.

■■

■■

■■

■■

Use two-factor authentication — This is basically needing two pieces of information to login to email accounts. Many credit unions have this already on their online banking logins.

Avoid linking accounts when possible — If hackers get into one account, they have access to all of your linked accounts.

Vary your email addresses— Don’t use the same formula for multiple email address, i.e. first initial. lastname@yahoo.com.

Back up your data in a hard location — Backup, backup, and backup. External hard drives and backup programs are not as expensive as they used to be.

crawling/scraping capabilities, and forum extraction, to make sure compromised credentials are spotted before they are stolen.

While many credit unions are currently monitoring members’ accounts for irregular activity, many members probably have no idea you provide this service. By offering your membership an account with an identity theft company, you are strengthening your relationship with them. You are once again showing them that their well-being matters to the credit union.

LEVERAGE is looking for credit unions that would be willing to pilot an identity theft program. The company LEVERAGE is currently looking at has a variety of products to offer. The lower level programs, which work very well, can be offered free to members who have a large portfolio with the credit union. This can be a benefit of membership.

Then more robust identity theft programs can be offered at just a few dollars per month. It can really turn into a great member benefit.

If your credit union would be willing to pilot this program, contact Kevin at kevin.lytle@myleverage.com.

LEVERAGE

Vendor Management Solutions Are Growing

By Keith Hopkins, vice president, Product Support, LEVERAGE In 2012, LEVERAGE joined with Strategic Partners and CUSG, to purchase Credit Union Vendor Management (CUVM). This October, the new jointly-owned CUVM added Ventelligence vendor management services to its portfolio of solutions. Originally developed by LEVERAGE’s predecessor, the FCUL Service Group, Inc., Ventelligence provides contract management services for than 60 credit unions throughout the United States.

The compliance challenges surrounding the management of thirdparty agreements continue to grow. Both CUVM and Ventelligence were created to address these compliance challenges and provide credit unions with efficient solutions for vendor management.

Combining Ventelligence and CUVM allows us to LEVERAGE experience, and effectively allocate resources to provide a best in class service offering to our partner credit unions.

Credit unions have choices when it comes to software solutions for vendor management. The partnership between CUVM and Ventelligence provides two unique platforms and various service level offerings to accommodate the varying needs of our partners. We will continue to support both platforms to ensure that we have solutions that meet those wide varying needs. Our goal was not to change the way we were servicing either Ventelligence or CUVM solutions, but to leverage the strengths of the solutions across both platforms.

CUVM and Ventelligence now share a due diligence management area, client analyst functions, and critical vendor review services.

Today, the combined solution is providing service to more than 140 credit unions and growing. The Ventelligence – CUVM combined offering positions us well for future growth and expansion of services.

More efficiently collecting and distributing vital information on high risk vendors, providing notifications of key contract milestones, and helping credit unions better assess the risks associated with vendor management are just a few of the key services that benefit from a Ventelligence-CUVM partnership.

In addition to vendor management, LEVERAGE will continue to offer Strategic Purchasing services. Many credit unions have utilized ePurchasing to assist them with everything from armored car services to janitorial contracts. LEVERAGE will continue to provide ePurchasing and negotiation services for credit unions looking to save money while improving purchasing efficiencies. Credit unions that have utilized LEVERAGE Strategic Purchasing in 2013, saved 24.3 percent on average over their existing agreements, or over the best previously negotiated price on new agreements.

The Ventelligence – CUVM partnership is a response from LEVERAGE to assist credit unions in complying with industry regulations concerning third party agreements. This new partnership provides the scale necessary for maintaining our position as an industry leader with regard to this critical service.

The compliance challenges surrounding the management of third-party agreements continue to grow. Both CUVM and Ventelligence were created to address these compliance challenges and provide credit unions with efficient solutions for vendor management.

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DIRECTORY

LSCU Directory LEAGUE 22 Inverness Center Pkwy, Ste 200 Birmingham, Alabama, 35242 3692 Coolidge Court Tallahassee, FL 32311 866.231.0545

Administration Patrick La Pine, x1002 President & CEO patrick.lapine@lscu.coop

David LeNoir, x2158 Member Relations Consultant david.lenoir@lscu.coop April N. Ales, x1038 Member Relations Consultant april.ales@lscu.coop Judy Scott, x1062 Member Relations Consultant judy.scott@lscu.coop Leonard Parkhurst, Jr., x1154 Director, Southeastern Credit Union Foundation leonard.parkhurst@lscu.coop

Jared Ross, x1012 SVP, Association Services jared.ross@lscu.coop

Education

Kate Brady, x1060 Executive Assistant to President/CEO kate.brady@lscu.coop

Teresa Gray, x2110 Sr. Director, Education teresa.gray@lscu.coop

Communications Mike Bridges, x1022 VP, Communications mike.bridges@lscu.coop Amy Jowers, x1020 Director, Communications amy.jowers@lscu.coop Natalie Edwards, x1014 Communications Coordinator natalie.edwards@lscu.coop

Compliance Bill Berg, x1028 VP, Compliance Training & Information bill.berg@lscu.coop Scott Morris, x2165 Director, Regulatory Advocacy scott.morris@lscu.coop

Julianne Talley, x1148 Director, Events julianne.talley@lscu.coop Brandy Norvell, x2172 Events Coordinator brandy.norvell@lscu.coop Becki Payne, x2129 Association Services Support Specialist becki.payne@lscu.coop

Governmental Affairs Jennifer Martin, x1150 Director, Legislative Affairs (FL) jennifer.martin@lscu.coop Andrew Gonzalez, x1010 Grassroots & Political Action Coordinator (FL) andrew.gonzalez@lscu.coop

Cooperative Initiatives

Jordan Burroughs, x1008 Governmental Affairs Specialist jordan.burroughs@lscu.coop

Laura Vann, x2181 VP, Cooperative Initiatives laura.vann@lscu.coop

Jason Cochran, x2159 Director, Governmental Affairs (AL) jason.cochran@lscu.coop

Adena Whitman, x2134 Senior Member Relations Consultant adena.whitman@lscu.coop

38

Blake Westbrook, x2164 Grassroots & Political Action Coordinator (AL) blake.westbrook@lscu.coop

A Magazine of the League of Southeastern Credit Unions

SIGNAL: Vol. 4, Issue 4

Finance & Administration Marvin Garland, x1102 EVP/CFO marvin.garland@myleverage.com

LEVERAGE Lisa Burroughs, x1004 SVP, Strategy & Business Operations lisa.burroughs@myleverage.com

Transactional Services Tyrell Baker, x1136 Director, Information Technology tyrell.baker@lscu.coop David Hairston, x1132 Network Administrator david.hairston@lscu.coop Debbie Caruthers, x1116 Director, Accounting debbie.caruthers@lscu.coop Angie Meisenheimer, x1114 Senior Accountant angie.meisenheimer@lscu.coop Josh Booth, x1118 Staff Accountant josh.booth@lscu.coop Mike Couey, x2136 Accounting Manager mike.couey@lscu.coop Susan Sungelo, x2153 Staff Accountant susan.sungelo@lscu.coop Jason Neifield, x1142 Director, Human Resources jason.neifield@lscu.coop Di Troch, x1054 Operations Assistant diana.troch@lscu.coop David Todd, x1124 Facilities & Operations Manager david.todd@lscu.coop

CUSC of Alabama Tameka Dukes, x2178 Director, Shared Branching tameka.dukes@lscu.coop

Jay Brady, x1106 VP, Transactional Services jay.brady@myleverage.com Janice Jordan, x2176 Director, Debit Operations & Training janice.jordan@myleverage.com Win Cooper, x2115 Sr. Transactional Services Specialist win.cooper@myleverage.com Chris Dirmann, x1182 Director, Card Services chris.dirmann@myleverage.com Robert Plant, x1194 Member Services Representative robert.plant@myleverage.com Linda Medina, x1200 P/T Member Services Representative linda.medina@myleverage.com Angela Harris, x1190 Card Services Manager angela.harris@myleverage.com Amy Bryant, x1196 Sr. Member Services Representative amy.bryant@myleverage.com Gwen Davis, x1186 Member Services Representative gwen.davis@myleverage.com Kia Albert, x1192 P/T Member Service Representative kia.albert@myleverage.com Kim James, x1198 P/T Member Service Representative kim.james@myleverage.com

Audit & Consulting Keith McMurtrie, x2133 VP, Audit & Consulting keith.mcmurtrie@myleverage.com Michael Hemminger, x1096 Staff Auditor michael.hemminger@myleverage.com Shani Montford-Smith, x2127 LEVERAGE Support Specialist shani.montford-smith@myleverage.com Kathy Reynolds, x2121 Auditor kathy.reynolds@myleverage.com Bonique Turner, x2124 Auditor bonique.turner@myleverage.com Arden Ward, x2132 Staff Auditor arden.ward@myLEVERAGE.com

Product Management Keith Hopkins, x1170 VP, Product Support keith.hopkins@myleverage.com Brandt Vinson, x1044 ePurchasing Coordinator brandt.vinson@myleverage.com Kelli Silvernale, 866.949.6220 Director, Vendor Management kelli@cuvm.org Karen Moran, 866.949.6220 Sr. Contract Management Analyst karen@cuvm.org Julie McCue, 866.949.6220 Contract Management Analyst julie@cuvm.org Jean Noel, x1188 Due Diligence Coordinator jean.noel@myleverage.com

LEVERAGE PARTNERS

Tori Shamy, x1172 Product Manager, Merchant Lending tori.shamy@myleverage.com

CO-OP Financial Services

Deirdre Rhodes, x1104 Product Support Manager deirdre.rhodes@myleverage.com

Enhance services to your members by expanding your ATM service delivery channels through more than 28,000 surcharge-free ATMs.

Anita Fumaria, x1140 Director, HR Services anita.fumaria@myleverage.com

Innovation & Business Development Kevin Lytle, x1120 VP, Innovation & Business Development kevin.lytle@myleverage.com Brooke Collins, x1050 LEVERAGE Support Services Specialist brooke.collins@myleverage.com Jordan Sullivan, x2137 Business Analyst jordan.sullivan@myleverage.com Mary Elicia Del Santo, x1144 Business Development Consultant me.delsanto@myleverage.com Steve Pullara, x1164 Business Development Consultant steve.pullara@myleverage.com Michael Baswell, x2151 Business Development Consultant michael.baswell@myleverage.com April Banta, x1162 Director, Marketing april.banta@myleverage.com Detra White, x1156 Production Artist detra.white@myleverage.com

ComplyTrac Automated compliance solution that streamlines compliance procedures and reduces costs through procedural controls to meet compliance requirements on a single platform and helps effectively execute regulations through automated software.

CU Members Mortgage Earn fee income based upon your participation in the origination and/or temporary funding of loans and build your mortgage loan portfolio.

CU Solutions Group

NADA Access the most current used vehicle values and new vehicle invoices for a wide range of vehicles, 24/7.

Office Depot Save money on office supplies, break room supplies, promotional products, furniture, and computers.

O’Rourke & Associates An exclusive credit union focus on executive and management recruiting.

Remarketing by GE Take advantage of preferred auction lanes and best-in-class processes to maximize your recovery dollars for auto liquidation.

That’s Life LEVERAGE’s merchant lending platform links credit unions with businesses in their communities to provide point-of-sale financing to consumers.

CU Solutions Group provides credit unions with marketing, membership enhancements, technology, and performance management solutions.

VERAFIN

CUNA Mutual Group

Combining strategic support services with broad trading capabilities to execute fixed income securities transactions.

Insurance and protection for your credit union and members; lending solutions and marketing programs for bottom-line impact; employee benefits to recruit and retain the right employees.

CUNA Strategic Services, Inc. Access for credit unions to products, services, and technologies.

CUVM Full-service solution working to reduce the burden associated with collecting vendor due diligence and managing vendor relationships that helps credit unions minimize vendor risk.

John M. Floyd & Associates

Detect BSA/AML fraud with leading-edge compliance and fraud detection software.

Vining Sparks

VINtek Complete collateral management solutions help increase operational efficiencies by streamlining processes, reducing user errors, and managing expenses every day.

For more information on any of these solutions, contact a Business Development Consultant at consult@myLEVERAGE.com or visit www.myLEVERAGE.com.

For information on partnership with LEVERAGE, contact a Product Development Consultant at partner@myLEVERAGE.com.

Earn non-interest income and provide an overdraft protection program to members.

Landrum Professional Outsource most of your daily human resources functions with Landrum Professional, a full-service PEO.

Rhea Oaks, x1146 Contract Management Analyst rhea.oaks@myleverage.com

SIGNAL: Vol. 4, Issue 4

www.lscu.coop

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Upcoming Governmental Affairs Conference Dates in 2014

Join the League in meeting with legislators face-to-face Alabama Credit Union Association State GAC February 4-5, 2014 Montgomery, AL Renaissance Montgomery Hotel & Spa

Florida Credit Union Association State GAC March 25-26, 2014 Tallahassee, FL DoubleTree by Hilton Hotel

CUNA GAC Feb. 23-27, 2014 Washington, D.C. For more information, visit www.lscu.coop or contact LSCU SVP, Association Services Jared Ross at 866.231.0545, x1012.

SIGNAL: Vol. 4, Issue 4

www.lscu.coop

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SIGNAL MAGAZINE RETURN ADDRESS 3692 COOLIDGE COURT TALLAHASSEE, FL 32311 22 INVERNESS CENTER PARKWAY, #200 BIRMINGHAM AL 35242

Tony Blair

Madeleine Albright