Leaders of Iowa’s banks and credit unions are engaged in an intense political dispute over tax policy. The last thing Iowans need is financially motivated government insiders mucking up the issue.
Unfortunately, that’s what has happened in recent months. Members of the state Board of Regents, tasked with governing Iowa’s public universities, put forth a policy proposal which clearly seems intended to influence the debate over taxing credit unions.
During a meeting earlier this year, Regent Larry McKibben said he was working on a policy to restrict the outside use of the Regent institutions’ names and trademarks. Board members connected the idea to the University of Iowa Community Credit Union, saying they worry a business scandal on the credit union’s part could tarnish the university’s good name.
Our public universities have a legitimate interest in protecting their brands, but the timing and the source of this proposal is highly suspect.
Most concerning is McKibben failed to disclose his ties to the banking industry. While McKibben left his conflict of interest disclosure form filed with the board blank, business records obtained by Gazette reporter Vanessa Miller show McKibben is part owner of Farmers Savings Bank in Marshalltown.
Regent Nancy Dunkel serves on the board of directors at Principal Bank in Des Moines, which she did include on her disclosure filing.
The proposed trademark policy comes at the same time Iowa lawmakers are considering a bill to subject both banks and credit unions to the same taxes. Banking industry players have complained for years that credit unions’ lower tax burdens are unfair.
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Regardless of the merits of that legislation, bank stakeholders who hold distinguished state government positions ought to be extremely careful to not give the impression of undue influence. Hinting about an unsubstantiated, hypothetical scandal at Iowa financial institutions crosses that line.
The Board of Regents’ actions this year seem like a ploy to make the public and policymakers distrustful of credit unions, rather than a legitimate policy concern.
“Do what I belong to or what I’m part of — does any of that have an effect on what I’m doing as regent? Good Lord, no,” McKibben told The Gazette last week.
That response is troubling. It doesn’t take a lawyer to see McKibben’s banking interests present a significant potential for conflicts of interest, especially when he chooses to put forth policy proposals aimed at competing credit unions.
Legislators are weighing an important issue with reasonable points on both sides. The Board of Regents should let them do their job.
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