First Regular Session

Sixty-first General Assembly

LLS NO. 97­0763.01D BWM HOUSE BILL 97­1338

STATE OF COLORADO

BY REPRESENTATIVE Taylor;

also SENATOR Matsunaka.

BUSINESS AFFAIRS & LABOR

A BILL FOR AN ACT

CONCERNING CLARIFICATION OF THE REQUIREMENT THAT CREDIT UNION MEMBERS BELONG TO A GROUP HAVING A SINGLE COMMON BOND, AND, IN CONNECTION THEREWITH, VALIDATING EXISTING CREDIT UNION GROUPS AND MEMBERS.

Bill Summary

(Note: This summary applies to this bill as introduced and does not necessarily reflect any amendments which may be subsequently adopted.)

Specifies that a group or groups served by a credit union as approved as of March 21, 1997, may continue to be served by that credit union. Specifies that credit unions chartered after March 21, 1997, or those seeking to amend their bylaws, organization, or membership, or to merge, after that date shall continue to be limited to a single common bond of employment, association, or residence in a well­defined neighborhood, community, or rural district with a population of no more than 25,000.

Defines the terms "common bond of employment" and "common bond of association".

Be it enacted by the General Assembly of the State of Colorado:

SECTION 1.  11­30­103 (2), Colorado Revised Statutes, 1987 Repl. Vol., as amended, is amended to read:

11­30­103.  Membership. (2) (a)  A GROUP OR GROUPS SERVED BY A CREDIT UNION AS APPROVED BY THE DIVISION OF FINANCIAL SERVICES AS OF MARCH 21, 1997, MAY CONTINUE TO BE SERVED BY THAT CREDIT UNION. FOR A CREDIT UNION CHARTERED AFTER MARCH 21, 1997, OR SEEKING AN AMENDMENT TO ITS BYLAWS OR credit union organization and membership, OR SEEKING TO MERGE, AFTER MARCH 21, 1997, other than those of a central credit union, SUCH CREDIT UNION shall be limited to groups A GROUP having a common bond of employment or A COMMON BOND OF association or groups which A GROUP HAVING A POPULATION AT THE TIME OF COMMON BOND APPROVAL OF NO MORE THAN TWENTY­FIVE THOUSAND WHO reside within a well­defined neighborhood, community, or rural district. having a population of no more than twenty­five thousand or as otherwise authorized by the board. Small groups which A SMALL GROUP THAT the commissioner determines to lack the potential membership to organize their ITS own credit union may be eligible for membership in an existing credit union if such THE small groups have GROUP HAS a common bond of employment or association. A member of the immediate family of any person who, under the provisions of this article, is eligible for membership in a credit union may also be admitted to membership therein. "Immediate family" means persons related by blood, by marriage, or by adoption.

(b)  AS USED IN THIS SUBSECTION (2):

(I)  "COMMON BOND OF ASSOCIATION" MEANS A GROUP CONSISTING OF NATURAL PERSONS WHO PARTICIPATE IN ACTIVITIES THAT DEVELOP COMMON LOYALTIES, MUTUAL BENEFITS, AND MUTUAL INTERESTS. THE GROUP SHALL HOLD MEETINGS AT LEAST ONCE A YEAR, SHALL SPONSOR OTHER ACTIVITIES THAT CLEARLY DEMONSTRATE THAT THE MEMBERS OF THE GROUP MEET AND INTERACT REGULARLY TO ACCOMPLISH THE OBJECTIVES OF THE ASSOCIATION, AND SHALL HAVE AN AUTHORITATIVE DEFINITION IN ITS BYLAWS OR CHARTER IDENTIFYING WHO IS ELIGIBLE FOR MEMBERSHIP.

(II)  "COMMON BOND OF EMPLOYMENT" MEANS A GROUP WITH EMPLOYMENT IN A SINGLE CORPORATION OR OTHER LEGAL ENTITY, IN A CORPORATION OR OTHER LEGAL ENTITY WITH AN OWNERSHIP INTEREST IN OR BY ANOTHER LEGAL ENTITY, OR IN A CORPORATION OR OTHER LEGAL ENTITY THAT IS RELATED TO AND POSSESSES A STRONG FINANCIAL DEPENDENCY ON ANOTHER LEGAL ENTITY.

SECTION 2.  Safety clause. The general assembly hereby finds, determines, and declares that this act is necessary for the immediate preservation of the public peace, health, and safety.