WILMINGTON — Steeple and Statehouse got together here when clergy conversed with the speaker of the Ohio House about possible legal restraints on payday lending.
The nine clergypeople were all Clinton Countians except Carl Ruby, pastor of Central Christian Church in Springfield who also is director of a statewide coalition of faith leaders publicly urging reform of the payday loan industry in Ohio. Ohio Speaker of the House Cliff Rosenberger (R-Clarksville) serves Clinton County as its representative in the Ohio House of Representatives.
“It was good to hear Speaker Rosenberger acknowledge that capping interest rates and limiting the size in monthly payments are part of the solution. These are key provisions of House Bill 123,” Ruby said after the Thursday dialogue held at the Wilmington First Christian Church.
The lawmakers sponsoring the proposed Ohio HB 123 are a Springfield Republican and a Toledo Democrat.
In late September, 10 Clinton County clergypeople asked Clinton County commissioners to support payday loan reform and to let Rosenberger know of the commissioners’ support. On Oct. 2, commissioners voted to send a letter to Rosenberger.
On Thursday, Rosenberger said he has assigned State Rep. Bill Seitz (R-Cincinnati), who is the House Majority Floor Leader, to help out the legislative process. He said he told Seitz to take the matter “very seriously” and get a conversation going.
That conversation will include, Rosenberger expects, deciding on the best place to cap the payday loan interest rates while also being mindful that what reportedly has worked well in Colorado would not necessarily work in Ohio. The proposed Ohio bill is modeled after 2010 Colorado payday loan reform.
Ruby said polls show payday loan businesses are very unpopular with voters and that there’s a high level of support for regulating them. He told Rosenberger part of what he was wrestling with is the question of why, with so much popularity among voters, the bill has not been moving forward after it was introduced in March.
Rosenberger responded in part, “I guess my way of thinking of government is [that] we’re a republic. We do take the time to look through these issues and we don’t always take an action over a poll.”
He added, “I can’t sit here today and tell you what the right setting of the interest rate looks like.” Ohio HB 123 would cap the interest rates of payday lending at 28 percent.
The Ohio House speaker also said “financial literacy” is probably a pretty important piece of the solution, but was not part of the bill when it was introduced.
Rosenberger said he thinks the payday lender should have to sit down and explain to the customer what his or her payments will look like and other circumstances. Instead, the transaction involves immediately signing a document “printed out from an HP printer in the back of the room, and the next thing you know $500 turns into $5,000,” he said.
Rosenberger said capping interest rates alone, without also making sure the customer understands the situation, will not do away with the problem. He elaborated that 28 percent interest “by the way is still very high.”
Further, the transaction needs to be conducted in a way that fees are not “somehow cutely passed along,” said the state representative.
Shortly after Rosenberger said that, Pastor Dave Hinman of the Dove Church in Wilmington said he appreciated the opportunity “to slightly amplify the voice of the voiceless,” and thanked the lawmaker for the summation.
“You do understand,” Hinman said.
After the clergy’s dialogue with Rosenberger, Ruby said, “We are very encouraged by today’s meeting. We were afraid that our voices were being drowned out by the huge out-of-state companies that profit from payday lending.”
Ruby also said, “We agree that financial literacy education is one part of the solution, but if people are drowning in a pool, you don’t just offer swimming lessons. You build a fence around the pool.”
Ohio HB 123 is in the Government Accountability and Oversight Committee of the Ohio House of Representatives. The committee is chaired by Rep. Louis W. “Bill” Blessing III (R-Colerain Township).
Reach Gary Huffenberger at 937-556-5768.