At its core, the disagreement centers on $36.4 million that Anderson Development borrowed from America First in 2007 to buy 320 acres adjacent to the former Geneva Steel Mill in Vineyard in Utah County.
As part of the deal, the two principals in Anderson Development Gerald Anderson and Michael Hutchings personally guaranteed payment, acting as co-signers for the loan.
When Anderson defaulted, America First filed a notice of default, but instead of going through foreclosure and liquidating the land, the credit union sought to collect on the $19 million loan balance from the guarantors Anderson and Hutchings. Since 2009, the credit union has been locked in litigation with the two.
"It's not, 'Members come first,' " Hutchings said of the credit union policy. "It's, 'We sue members first.' That's their new policy."
The Utah Supreme Court ruled in its 2004 case of Machock v. Fink that banks are allowed to try to collect from guarantors while simultaneously foreclosing on the property.
Bramble thinks that is wrong that creditors should have to take the underlying property, whether it's land or a home or a car then pursue the guarantors for the difference between the value and the amount owed.
That's what SB218 would retroactively require but only for credit unions, not for banks.
That doesn't sit well with America First, which doesn't want to be stuck with the 320 acres of land, or to take on Anderson's estimated $10 million commitment to the city of Vineyard to build a railroad overpass, a fire station and water tank.
"They're looking for a bailout. Period," said Scott Simpson, president of the Utah Association of Credit Unions. "These are guys who are used to the Legislature giving them what they want and they think they can get a bailout on the backs of members of the credit union."
They are not neophytes, Simpson said. Anderson has been a developer for decades; Hutchings is a former state judge.
"There's no way [America First] would have made that loan except under the legal construct it was made, and now they're trying to go backward and change that," Simpson said. Retroactively undoing business deals could jeopardize the entire system, he said.
Anderson Development has hired several of Capitol Hill's most prominent lobbyists to work on the issue, and the credit unions are always well-represented at the Legislature, having almost-annual battles with bankers.
But the fight is not just about Anderson Development, Hutchings argues. Other guarantors are being targeted by America First.
"We happen to be a couple of people who are willing to stand up and try to do something about this," said Hutchings. "We just can't go away or pretend the problem doesn't exist."
Clifford Redekop is one of the guarantors locked in a legal battle with America First.
The Henderson, Nev., businessman bought 135 acres of land in Hurricane. When the economy tanked, he reformulated his plan and decided to build a National Hot Rod Association-certified drag racing track, but America First cut off communication, he said.
"This is one of the best projects I've put together in my life," Redekop said, saying it would create jobs in the area.
Unable to get the project moving, Redekop fell behind on loan payments, and America First filed a notice of default, then sued Redekop personally for the $5.2 million loan he had guaranteed.
"I call that vengeance banking," said Redekop. "It's heartbreaking."