More than 70 consumer groups, advocates for the poor and senior citizens, and the state attorney general all oppose proposed revisions to the state’s payday lending law.
One would think that would be good enough for lawmakers. But for some reason, House Bill 1922 and Senate Bill 5899 are coasting along in the Legislature.
A cynic might wonder whether it has something to do with all the money the payday-loan industry has been donating to lawmakers.
According to the Seattle Times, in last fall’s election the Moneytree payday lending firm, its executives and other industry donors gave nearly $48,000 to Democrats — almost triple what they had given in the previous four years. They gave even more — $58,000 — to Republicans’ campaigns in 2014.
We’re guessing that donations by opponents of the bill weren’t anywhere in that ballpark. Groups fighting for consumers and the poor don’t tend to have big budgets for campaign contributions.
More evidence of the uncomfortably close ties between lawmakers and the industry came in the form of an op-ed submitted to the Times under the bylines of two King County representatives, Larry Springer, D-Kirkland, and Rep. Eric Pettigrew, D-Seattle.
The Times discovered that the piece, which supports the revisions, actually was written by a public-affairs firm hired by Moneytree.
The proposed legislation is trademark payday-loan industry obfuscation. Changing the type of loan is exactly the kind of thing the industry has been trying to do in other states to skirt or water down restrictions on its marketing of high-cost loans to mostly low-income people.
HB 1922 and SB 5899 would replace traditional two-week payday loans with ones that would stretch repayment out for up to a year. But opponents argue that the ability to convert short-term payday loans into the long-term installment option is already allowed under Washington law — and at a much lower cost in fees and interest than the one proposed.
Critics say the legislation would just replace payday loans with something that’s more confusing and expensive — and that doesn’t have the protections of the existing payday lending law.
It’s understandable that the payday-loan industry is fighting to change the existing law. Lenders have lost about 75 percent of their business since legislation restricting their loans went into effect five years ago. Their efforts have nothing to do with helping poor people and everything to do with their bottom line.
Lawmakers should see this legislation for what it is and reject it. If it passes, Gov. Jay Inslee should veto it.