Monthly Archives: March 2013

Payday loan bill hurts the vulnerable, helps the lenders

March 21st, 2013|

The Olympian’s editorial board has added its voice to the chorus of opposition against payday lending legislation that recently passed in the Senate:

A bipartisan group of state senators is trying to undo the restrictions placed on high interest-rate payday lending four years ago. If passed, Senate Bill 5312 would once again permit payday lenders to prey on our state’s poorest and most vulnerable citizens.

The bill should have died in committee, because it is so contrary to Washington state values. Instead, it cleared the Senate on a vote of 30 to 18. All the South Sound senators voted in favor, including Sens. Randi Becker, Karen Fraser, and Tim Sheldon.

Payday lenders profit on the misfortune of those who cannot pay their everyday expenses by offering advances on future paychecks at excessive rates of interest. Payday loans help fuel the downward spiral often associated with substance and gambling addictions.

The industry was getting out of hand in 2009, causing the Legislature to pass reforms that protected people from getting trapped in a cycle of inescapable debt.

Those reforms successfully reduced payday loan debt statewide by 75 percent.

But Senate Bill 5312, introduced by Democrat Sen. Steve Hobbs, would undermine the 2009 Payday Lending Reform Act by reclassifying payday lending as installment loans, and permitting loan costs of up to 220 percent. It would strip away the protective restrictions for military families under federal law, and make them eligible for these unreasonable high-interest loans.

The Seattle-based moneylender, Moneytree, is pressing legislators to allow this end-run around the 2009 restrictions because online money lending is cutting into its business, and an assertion that consumers want a longer period of time to pay back short-term loans.

But that’s no reason to expose our state’s most vulnerable to what the Statewide Poverty Action Network called “payday lending on steroids.”

It is a reason to attack predatory lending on a national scale, including the rampant online operators. Oregon Sen. Jeff Merkley has done just that. The Stopping Abuse and Fraud in Electronic Lending Act would shut down the most egregious schemes of the online payday industry.

Our state senators and Moneytree should support that effort, rather than reopening the floodgates in our state.

One of the bill’s strongest critics, Sen. Sharon Nelson, says, "As a former banker, I view this legislation as a return to the dark days of predatory payday lending, and a money machine for those who profit on other’s indebtedness."

According to the Pew Charitable Trusts, online loans will total 60 percent of the total payday loan market by 2016, almost doubling its share in 2011. Americans borrowed $13 billion on payday loans in 2011, up 120 percent from 2006.

We’re surprised that Democratic senators sponsored this bill. Perhaps they were under the false impression created by SB 5312’s supporters that it would generate new state revenue from licenses and fees. The state budget office, however, has said it would cost the state more to implement than the revenue it would generate.

Perhaps senators saw this as a consumer advocacy bill by creating more choice for individuals. But enabling bad financial choices will cost us all in the end.

We understand that Moneytree wants to protect its business, but the Legislature should not enable one industry to succeed on the backs of low-income people trying to survive on a financial edge.

Legislators interested in protecting consumers and the most financially vulnerable will let SB 5312 die in the House and stand firm in their continued support for the 2009 Payday Lending Reform Act.

Sen. Nelson’s statement on the March revenue forecast

March 20th, 2013|

Today Sen. Sharon Nelson, D-Maury Island, a member of the Senate Ways & Means Committee, issued the following statement after the release of the March revenue forecast, which showed a net gain of $40 million in revenue over the next two years and that the forecast is mostly unchanged from November projections:

“Washington state is finally emerging from the Great Recession and this forecast shows we are making progress.

“The numbers released today show that we are finally on a path to economic recovery. We have an obligation to our children and families’ futures through funding education, creating jobs and protecting our quality of life.

“While the numbers released today are better than expected, we still have much to accomplish.”

Senate honors Seattle Raging Grannies

March 13th, 2013|

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Today the Washington State Senate honored the Seattle Raging Grannies, a group of wise women who use song, dance and humor to promote global peace, social and economic equality.

"I am very proud to welcome and honor this group of extraordinary women," said Sen. Sharon Nelson, D-Seattle, who sponsored Senate Resolution 8629 in recognition of the group’s contributions. "These women understand the importance of protecting the vulnerable, working to improve their conditions and conserving the environment for future generations."

The group works to raise awareness and challenges its audiences to help bring about social change to end economic oppression, especially for women and children, and to end racial inequality, environmental destruction, human rights violations and arms proliferation.

"Their blend of old songs with new lyrics that mirror the policies, personalities and current issues is one-of-a-kind and brings a fresh perspective on so many of the challenges we face as a state, nation and world," said Nelson.

The Seattle Raging Grannies model themselves after the Canadian Raging Grannies and began in Olympia in 1996. This year their activism has focused on preventing climate change. In a special performance after their resolution, they performed their new song, "Radical Environmentalists."

Nelson grades Republicans on education

March 7th, 2013|

Yesterday the Washington State Senate voted to approve Republican education bills that fail to address the requirement set forth by the Supreme Court to fund education and our schools. Sen. Sharon Nelson, D-Maury Island, issued the following statement:

“According to legislation passed yesterday, if Republicans in the Senate were a school they would have earned an “F” for failing to do their paramount duty and fund education. They brought before us a list of more unfunded mandates without any reference to how we will pay for them as a state.”

“I am proud of my Democratic colleagues, especially those on the Early Learning & K-12 Education Committee, who reiterated what Republicans call reforms are really just hollow promises, and who were relentless in advocating for our children who will potentially be affected by this legislation.

“Republicans clearly showed that they are more concerned about labeling our schools and offering unfunded mandates than creating real results.

“We cannot keep raising expectations of our schools and our students when there is no clear plan in place to give them the critical resources and funding they require.”