If UWCU refunded ATM fees there'd be no reason to bank anywhere else. I wish they would do it.
I can think of a reason. If they did that it would hurt their ability to offer their members better rates of interest because they'd be spending that money on this ridiculous idea.
You're already 'subsidizing' me because I use UWCU ATMs for free and I'm not a UWCU member. So why not charge non-members for use of UWCU ATMs while refunding members' fees at other banks' ATMs that charge a fee?
You may find this idea 'ridiculous' in your pretty little provincial world but its pretty standard in the real world.