COLUMBIA, SC (WOLO) — A new bill set to be introduced at the Statehouse would provide local governments and other public entities (like fire departments) with access to credit unions for public deposits.
Supporters of the bill say access to a credit union for public deposits will help keep money in local communities, reduce risk to taxpayers, and help taxpayer dollars go further.
To date, state law mandates that local governments and local elected officials use a commercial bank.
Aiken’s former Mayor Rick Osbon believes the proposed bill is about allowing competitive choice and a stronger free market — with 77% of public deposits currently held by out-of-state banks.
“That’s not right, and that’s not how our state’s tax payer dollars should be managed. There’s often a credit union based in these same communities, particularly in rural communities, who can offer better rates and keep those tax dollars in sc. Creating more opportunities for residents to buy homes, buy trucks, or purchase farm equipment,” Osbon says.
Also known as the “South Carolina Community Financial Empowerment Act,” Representative Nathan Ballentine says he created and pre-filed the bill Wednesday morning after receiving concerned calls from local citizens.
“I’ll be honest, I didn’t even know they couldn’t do what they’re looking to do. It made no sense that we have that boundary in place. We have the same protections at these other local community institutions. Many who are serving communities that the big banks have long left behind or forgotten about,” says Ballentine.
Travelers Rest Councilwoman Catherine James says credit unions oftentimes provide lower interest rates on loans, and have a better rate of return because of their not for profit status.
Reasons she believes the bill will pass in the SC House and Senate.
“I think this is an old law that’s really just an error of omission when things changed back in the 70’s. Federally, credit unions are able to support deposits just like banks are, but something fell off the books, so we’re just simply asking for a correction,” says James.
The bill will officially be introduced when session begins again at the Statehouse in January.
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