Payday loans are marketed as solutions to short-time financial crises, but lenders make most of their profits from repeat borrowers who are trapped in long-term cycles of debt. In Louisiana, these loans carry annual percentage interest rates averaging 400% and drain more than $145 million in fees from Louisiana families each year. The Legislature this year voted to expand predatory lending by allowing new, costlier loans into the marketplace. Fortunately, as an Advocate editorial explains, Gov. John Bel Edwards did the right thing by vetoing Senate Bill 381: 

The (Sen. Rick) Ward bill would have capped finance charges at 100% of the original loan amount. Lenders could have charged up to $1,500 in fees on a $1,500 loan, for a total repayment of $3,000. … This would have been Christmas in June for the predatory lending industry. And if you’ve ever watched “It’s a Wonderful Life” during holidays, Ward was taking the side not of Jimmy Stewart but the avaricious Mr. Potter. We commend the governor for stepping in. Before they tackle the issue again, legislators should reflect on the damage that this kind of product can do to their constituents in working families.

Read statements from Davante Lewis, Director of Public Affairs and Outreach for the Louisiana Budget Project and Jared Pone, Policy Counsel for the Center for Responsible Lending (CRL) praising Gov. John Bel Edwards’ veto of Senate Bill 381.

Hurricanes are hardest on the poor 
Louisianans can expect an active hurricane season in 2022, with cities like New Orleans still vulnerable to massive power outages, insurance companies fleeing the market and blue tarps still on many roofs from Hurricane Ida. As the LSU Reveille’s Claire Sullivan argues, Louisiana residents shouldn’t have to go it alone when storms hit: 

Storm preparedness should include a willingness to aggressively address the financial needs of communities before and after hurricanes make landfall. It should mean taking climate change seriously, which means taking on the oil, gas and chemical corporations that cause it. It should mean providing people with economic autonomy by easing constraints of poverty that can make evacuation impossible and recovery equally difficult. It should mean that the federal government acts with as much urgency as possible to ensure that no resident goes without a roof over their head, clean water or adequate nutrition in a hurricane’s aftermath. As Louisiana residents brace themselves for the coming months, they should not do so alone.

Congress cuts school meal funding as food prices rise 
Millions of students will lose access to free and reduced-priced meals on June 30 unless Congress extends pandemic-related school meal flexibilities. The U.S. Department of Agriculture estimates that funding for school cafeterias will drop by more than 40% if key waivers aren’t renewed, even while supply chain disruptions have raised prices and made many ingredients scarce, and while school kitchens continue to face labor shortages. Advocates were caught off guard when the waivers were left out of a $1.5 trillion Congressional spending bill in March after objections from Republicans. As Vox’s Rachel M. Cohen reports, without new congressional action, students and schools will feel the consequences:

Decades of research have shown how child nutrition programs aid academic achievement, school attendance, and student health outcomes. But the consequences of not extending the waivers will not be limited to families penalized by paperwork. Schools will also have less money to meet rising food prices and will face steeper financial penalties for not meeting all federal nutrition requirements, a challenge amid widespread product shortages. Some schools may decide to cut back on food offerings and even stop providing meals altogether. Others may slash budgets for their classrooms.

Focus on third-grade reading 
Legislation that would require most third graders who score at the lowest level of the state reading exam to repeat the grade advanced out of the Senate Finance Committee on Wednesday. House Bill 269 by Rep. Richard Nelson now heads to the full Senate for final passage with only days left in the legislative session. Based on Mississippi’s experience with a similar law, up to 4,500 Louisiana students may be held back in the first year if the proposal is implemented. The Advocate’s Will Sentell reports: 

Some education leaders have raised concerns that the bill could lead to overcrowded third-grade classes because of a surge of students forced to repeat the grade. However, the state Department of Education would set the cut scores needed for students to move to the fourth grade, which would allow the state to control the number of children forced to repeat the third grade. The legislation was changed in the Senate Education Committee to ensure that students get three chances to meet the standard needed for promotion. Children would also get intensive intervention between tests. Those forced to repeat the third grade would also get a wide variety of assistance, including tutoring, extended school days and summer reading camp.

Number of the Day
116,000 – Number of child care jobs that have been lost nationwide since
February 2020. Child care centers are struggling to fill difficult, low-paying, jobs. (Source: Center for the Study of Child Care Employment at the University of California, Berkeley).