Payday loan industry wins another round at the Legislature
The effort to rein in predatory payday lending suffered a possibly fatal setback Wednesday at the Legislature, where reformers were turned back twice in an effort to cap the number of payday loans that borrowers can take out in a 12-month period. As The Advocate reports, senators rejected attempts to amend an industry-backed bill by Rep. Erich Ponti, R-Baton Rouge, to create a database that would track payday transactions and put a 10-loan annual limit on borrowers. Over in the House, legislators rejected a similar loan-cap amendment on a bill that makes minor changes to the state’s consumer credit law. “It’s a very modest request to try to help some of our constituents who have been trapped in the debt cycle,” said Rep. Ted James, D-Baton Rouge, who has been a leader in the drive to cap the rates that payday lenders can charge.
Meanwhile, Walt Henderson of the Leadership Conference on Civil and Human Rights says tightening the rules on payday lenders is critical to closing the widening racial wealth gap in America. “This broadening wealth gap can be attributed in no small part to predatory payday lending activity that disproportionately – and aggressively – targets minority communities. Payday loans alluringly, and often deceptively, provide a quick route to credit for consumers who might not qualify otherwise. However, they must be fully repaid in a very short period of time — often on the borrower’s next payday. This repayment structure and the lack of underwriting for affordability for the loan contributes to a hopeless cycle of indebtedness, causing borrowers to pay more in fees alone than the amount they borrowed and forcing them into even more dire financial situations.”
Sen. Landrieu urges protection of Coastal use fund and better budgeting procedures
U.S. Sen. Mary Landrieu is weighing in on the state legislative debate over how the state’s Coastal Protection and Restoration Fund can be used in future years. House Bill 490 by Rep. Brett Geymann, R- Lake Charles, would end the practice of using the fund a means to “clean” one -time money by swapping dollars to fill budget gaps. Since the constitution bans the use of one-time money for recurring expenses, Gov. Bobby Jindal and the Legislature have deposited those dollars into the coastal fund and then withdrawn the same amount and used it to fill budget holes. “’This manipulative process is wholly inconsistent with the intent of the Louisiana Constitution and responsible budgeting practices,’ wrote Landrieu, a Democrat.”
Efforts to reign in TOPS spending not seeing much support
Senate Finance Committee Chairman Jack Donahue, R-Mandeville, has withdrawn a bill that would have saved the state $252.8 million over the next five years by capping the popular TOPS college scholarships. Donahue made the decision after senators rejected a more limited attempt at reigning in the costly program by raising the academic qualifying standards. The TOPS program is projected to cost the state $387 million by the 2018-19 school year. The issue is not completely dead, however, as legislation is still pending in the House. As Nola.com reports, “If Donahue or (House Speaker Chuck) Kleckley were willing to bring TOPS change forward next year, the proposals might make it farther in the legislative process, though some legislators would probably still be wary of sticking their necks out. Gov. Bobby Jindal had said he likes the current structure of the TOPS programs. It’s possible he would veto any changes that arrived on his desk.”
House agrees to close LSU public hospital in Pineville
Amid questions of whether or not financing deals will work in the privatization of Louisiana’s public hospitals, the House of Representative voted 65-29 to close Huey P. Long Hospital in Pineville and transfer services to Christus St. Frances Cabrini Hospital and Rapides Regional Medical Center. The Pineville closure is the final shuttering of a public hospital in Jindal’s privatization plan. The Associated Press quotes Rep. Lance Harris, R-Alexandria, saying that privatization will provide better care for the uninsured.