Sunday, Apr 22, 2018
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Ballot taking shape on Ohio's new payday-lending law

COLUMBUS - In perhaps the first battle of the Nov. 4 election, both sides of an effort to keep a new payday lending law from taking effect managed to inflict a few wounds yesterday.

The payday-lending and check-cashing industry succeeded in convincing the panel writing the ballot not to mention the 391 percent annual interest rate that critics argue is the real price tag behind the flat fees charged for two-week loans.

"No one pays that, and the reason is Ohio doesn't let you do 391 [percent] in a year," said Don McTigue, one of the attorneys for the Reject House Bill 545 Committee.

"To use that argument would be like telling a police officer I was not going 100 miles an hour because I was only driving 10 minutes," countered Bill Faith, executive director of the Coalition on Homelessness and Housing in Ohio, which supports the new law.

The industry hopes to submit more than 241,365 valid signatures of registered voters by Aug. 31 to prevent the new restrictions from taking effect the next day. Voters would then be asked whether they agree with the General Assembly on this subject.

The law would greatly reduce the amount that check-cashing and payday-lending institutions can charge on typically two-week loans for borrowers facing immediate cash-flow problems between paychecks.

Supporters of the law argued that the fees could be extrapolated to the equivalent of a 391 percent interest rate if carried out over an entire year, a figure that typically appears on the loan documents.

The new law caps that annual rate at 28 percent and gives borrowers at least 30 days to pay back the money and reduces the maximum amount of such a loan from $800 to $500.

A frustrated Ohio Ballot Board struggled for nearly five hours yesterday before unanimously agreeing to the language that will greet voters.

"In our attempt to be clear and concise, we're having great difficulty," said Secretary of State Jennifer Brunner, the board's chairman.

While losing the 391 percent battle, opponents of the referendum succeeded in having the term "payday lending" placed front and center in the ballot issue's title, something the industry strongly opposed. The referendum's opponents hope to capitalize on the bad publicity the industry has recently faced.

The ballot issue is worded so that voters will be asked whether they favor the law as passed.

A yes vote would allow it to go into effect while a no vote would repeal the section in question.

The ballot board also agreed on language for the latest attempt to convince voters to approve casino gambling. While often a touchy subject with Ohio voters, it was tame yesterday compared with the controversy created by the payday issue.

Opponents of the single Nevada-style casino in southwest Ohio succeeded in adding language suggesting that revenue from the proposed 30 percent tax on the casino's take could prove illusory.

The money, promised to all 88 Ohio counties, could be reduced or eliminated if voters approve one or more competing casinos with lower tax rates or if the federal government recognizes an Indian casino that would be tax-free.

However, much to the satisfaction of the casino's developers, one of the first things voters will see on the ballot will be their initial minimum investment of $600 million in the project.

The ballot board is expected to complete the ballot language for a proposed voter-initiated statute that would mandate employers with 25 or more workers provide them seven days of paid sick leave per year.

Contact Jim Provance at:

or 614-221-0496.

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