CUNA Mutual Group said Tuesday it has donated $20 million to help communities near its Madison, Wis., headquarters and three regional offices, and gave credit for the “unprecedented boost in funding” to the tax breaks signed into law by President Trump.
The mutual insurance company joins a long line of banks and other companies that have made public announcements to attribute salary increases, bonuses or charitable giving to the Republican measure. Credit unions haven’t been able to join this parade. Credit unions don’t directly benefit from the tax law because they are exempt from federal income taxes, a break banks have long tried to eliminate.
But CUNA Mutual Group, which is controlled by its credit union policyholders, made a point to tie its gift to the cut in corporate income taxes, which it does pay.
Usually the insurance company gives $1.5 million to $2 million each year to its charitable arm, the CUNA Mutual Group Foundation. The purpose of the 501(c)(3) is to advance economic stability and support the sustainable development” in communities near its offices in Madison, Waverly, Iowa, Great Bend, Kan. and Fort Worth, Texas.
Robert N. Trunzo, CUNA Mutual Group’s president/CEO, said the tax breaks aided the increase, which will provide additional money to nonprofit organizations that address economic challenges, education disparities, and equity issues.
“There are thousands of people in our communities struggling to make ends meet, and as one of Wisconsin’s largest employers, we want to make a real difference with this tax relief opportunity,” Trunzo said.
“It is imperative our foundation’s funding aligns with our company’s values and helps close the gap on economic and educational disparities in our communities,” he said. “As a community leader, we will put this funding to work, where we live, work and serve to truly make a difference.”
Conservative groups have been touting each announcement tying corporate largess to the massive Republican tax cuts as proof by anecdote of their efficacy in distributing wealth and boosting the economy.
More skeptical reports from NBC News, The New York Times and other mainstream media outlets have quoted economists who say most of the raises are being forced by a labor market that has been tightening since the economy hit bottom in early 2009. Also, they say many companies will quietly pay out higher dividends or buy stock to boost their value.
On Monday, Fox Business posted a story headlined “Tax reform windfall” listing 22 companies from Wal-Mart to Walt Disney that were hiking pay or bonuses. The list included five of the nation’s largest banks: Bank of New York Mellon Corp., Fifth Third Bancorp, JPMorgan Chase, U.S. Bank and Wells Fargo.
Alongside the story was a video of President Trump speaking in Nashville Jan. 8, saying “More than 100 companies have already given bonuses and other benefits as a result of these massive tax cuts.”
The article ends with “FOX Business is keeping track of the tax benefits that have reached more than 3 million Americans so far.”
Grover Norquist’s Americans for Tax Reform also maintains a “List of Tax Reform Good News” on its website. As of Tuesday, it included about 350 companies, including more than 100 banks or financial services companies.
Like the Fox Business list, none was a credit union.
CUNA Mutual Group generated $3.3 billion in revenue in 2016, two-thirds of it from premiums for life, health, property and casualty insurance. Assets stood at $20 billion as of Sept. 30.
It generated $222.6 million in net income in 2016 after paying $95.3 million in income taxes. Spokeswoman Wendy Serafin said the new law will reduce its taxes further.
“Due to the decrease in the corporate tax, we are able to take this savings and share it with our communities by expanding our funding for our foundation. We felt this could make a real difference in the communities where we live, work and serve,” Serafin said.
