CommunityAmerica’s $70 million stadium deal raises questions.
The Kansas City credit union’s growing portfolio of sports partnerships is drawing scrutiny over how a tax-exempt, member-owned institution should spend its money.
CommunityAmerica Credit Union has spent years building its name through partnerships with the Kansas City Chiefs, the Kansas City Royals and star athletes Patrick Mahomes and Bobby Witt Jr.
Now, a reported $70 million agreement to secure naming rights for the University of Arkansas football stadium is raising questions about how far the nearly $10 billion institution has strayed from its local roots.
The deal, and the credit union’s broader marketing strategy, are the focus of a critique by Jilinda White, chief executive of First State Bank & Trust in Tonganoxie, Kan., who argues that the spending reflects the priorities of a business pursuing market share more than those of a member-owned cooperative.
White’s op-ed appeared this week in the Topeka Capital-Journal.
White’s argument centers on a basic tension in the credit union industry: As institutions grow beyond their traditional markets, they face greater pressure to build name recognition and attract customers. But credit unions also benefit from a special tax status intended to support their cooperative mission.
CommunityAmerica’s expansion reflects that shift. Its sports partnerships are designed to increase visibility and reach potential members well beyond the Kansas City area, as mergers and other growth initiatives extend its footprint into new markets.
The Arkansas agreement would put the credit union’s name before audiences hundreds of miles from its historic home market. Published reports cited by White suggest the naming-rights deal could cost as much as $70 million over 14 years.
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CommunityAmerica has said it returned $110 million to members through its Profit Payout program over the past 14 years, according to its marketing materials. White calculated that the figure averages about $86 per qualifying household.
The two figures measure different things: one is a reported long-term marketing commitment, while the other is a cumulative return to members. But White argues that the comparison raises a question members should be asking: How do large branding investments translate into direct benefits for the people who own the institution?
Credit unions are member-owned financial cooperatives, unlike investor-owned banks. Their tax-exempt status has long been tied to their role in serving members, including people of modest means. White argues that the exemption makes large-scale spending on national sports branding worthy of closer scrutiny.
For CommunityAmerica, the partnerships are part of a strategy to build recognition, enter new markets and support future growth. Those are familiar aims for businesses competing for customers, particularly as financial institutions seek to expand beyond their established territories.
White said Kansas bankers understand the need to compete and invest in their communities. But banks pay income taxes that help fund public services, including schools, law enforcement, infrastructure and hospitals, she noted.
Her criticism extends beyond CommunityAmerica. She argues that as credit unions become larger and more geographically ambitious, Congress should take a closer look at whether their use of tax advantages remains consistent with the rationale for those benefits.
For members, the immediate question is more specific: What does a stadium naming-rights deal in Arkansas deliver to them in return?
White contends that CommunityAmerica’s spending reflects an institution increasingly focused on expansion and brand value. Its sports partnerships, she argues, have brought the credit union to a point where its priorities deserve renewed scrutiny — not just from members, but from policymakers examining the industry’s tax treatment.
“As for all of us that are required to pay income taxes, we might wonder why Congress isn’t taking a closer look at how credit unions are utilizing their special tax treatment.”
Jilinda White
CEO
First State Bank & Trust
Ken McCarthy is manager of marketing communications at Tyfone, where he monitors the credit union industry and contributes to conversations shaping its future. He previously covered credit unions and community banking for American Banker and S&P Global Market Intelligence. He holds a journalism degree from Point Park University and has more than 15 years of experience covering financial services. He is also the author of three literary fiction novels.
