Pub. 6 2011-2012 Issue 2

July/August 2011 17 Extraordinary Service for Extraordinary Members. L ATELY THE NEWS HAS BEEN FULL OF our state and federal budgetary challenges. Our country is faced with some very difficult deci- sions, and it is time to address them. On an online article about a recent Colorado community bank failure, I saw many posted comments recom- mending that all former customers of the bank transfer their accounts to the Colorado credit unions because they were “safer.” In Nebraska, the Farm Credit System (FCS) paid a dividend to their customers, resulting in several farmers telling me it was less costly to get their loans through FCS than their local community banks. So which is true, and why should you care? Colorado and Nebraska are both dealing with budget deficits. Both states face raising taxes and fees along with spending cuts. As a result, the states are cutting educational budgets, eliminating many teacher positions. Colorado is reducing edu- cational funding by $227.5 million. In Nebraska, local school districts will receive $128 million less than last year. Rural communities with declining school enrollment will be hit the hardest; Ogallala’s cut will be $1.1 million. As a community banker, I can readily see the hardship these budget cuts will cause to our schools, the elderly, and the poor. This brings me back to the credit unions, the Farm Credit System, and my proposed budgetary solution. Credit unions and FCS are for the most part exempt from tax, and enjoy roughly a 30 percent tax advantage over your local community bank. In essence, they are not required to “pay to play” in our system. In contrast, our bank has had to budget $2.2million for federal taxes in 2011. The $29 Billion Budget Solution Chad Adams , President, Adams Bank & Trust, Ogallala Q Budget Solution — continued on page 18