Payday Lending and the Governor’s race

It keeps being a thing. The El Paso Times now reports that the payday lending issue has officially entered the gubernatorial election, and that it has created some big waves between the candidates. As I noted a couple of days ago, the controversy first arose when it came out that William White, the de facto Payday Lending Commissioner, was an official with such an institution. In another story first broken by the Times, Senator Wendy Davis (the Democratic nominee for Governor) called for the commissioners’ resignation.

In a retort, Attorney General Greg Abbott (the Republican frontrunner for Governor) pointed out that Davis had actually voted to confirm White in his role as Chairman of the Texas Finance Commission. This point, of course, was first made by Big Jolly Politics. While all this is true, Davis’ campaign went on to note the extenuating circumstances regarding that such vote. White was part of a large cluster of nominees to be confirmed concurrently, meaning that in order to block him she would have had to block all the nominees. Additionally, the Times notes that Davis had already made negative comments regarding White before his confirmation.

Click here to read more!

Davis and Payday lending

The El Paso Times continues reporting on a controversy that has been brewing now for a number of days. First, the Times reported last Sunday that the Chairman of the Texas Finance Commission, as well as the Consumer Credit Commissioner, a man named William J. White, has extensive ties to the payday lending industry. Specifically, he is the Vice-President of Cash America, one of the largest payday lending chains. This type of cronyism, of course, is not an especially new move for someone affiliated with the Perry administration, but I digress.

The Times approached White a few weeks ago to talk about the possible conflict, and received nothing but abrasive and laconic retorts from the Commissioner. The article then went on to discuss the many excesses of payday lending and its sometimes usurious tendencies. Sagacious followers of Texpatriate will be very familiar with those excesses, so I will not discuss them here. Otherwise, read the article (it’s quite good).

Click here to read more!

Payday Lending ordinance passed

Scroll to the bottom to read about Councilmember Rodriguez’s blowup on Twitter against three Chronicle writers, Texpatriate and Noah M. Horwitz

The Houston Chronicle reports that the Payday Lending ordinance, which has been kicked around at the City Council for a few weeks now, has been passed by the City Council in a lopsided vote of 15-2. The strong majority support placated fears that the ordinance would be delayed into next year’s session, complete with a City Council riddled with new (and sometimes unpredictable) individuals.

The ordinance requires payday lenders to register with the City, provide contracts in easy-to-read and straightforward language, limits the amount of a loan and places strict restrictions on the number of times a loan may be refinanced. While a cap on interest is omitted, the ordinance has some real teeth and is noticeably stronger than that initially proposed by the Mayor. It is worth saying that the Mayor has received some pretty generous contributions from Payday Lending PACs over the years, so the new hefty ordinance is a nice precedent to set that you must not always be a slave to who has given you money.

Among some of the ordinance’s detractors were those who believed it was overkill –though still acknowledged something needed to be done. They were led by Councilmember Jack Christie, who proposed an amendment that would have largely gutted the provisions of the act. The amendment garnered six votes, including Andrew Burks, C.O. Bradford and Dave Martin.  While all of these individuals gave long pontifications against the regulations earlier, they all ultimately voted in favor. Helena Brown –the dependable ‘no’ vote– and James Rodriguez were the only dissenting voices in the final tally.

Click here to read about Rodriguez’s Twitter temper-tantrum!

Texpatriate supports Payday Lending reform

Hubert Humphrey once said that the Government’s most quintessential role was to protect the vulnerable among us. Specifically, the needy. In Texas, there are few industries that pick on the needy more than the payday lenders. The condoned loan-sharks regularly charge interest rates upwards of 600% APR and aggressively pursue frivolous criminal charges against those who cannot pay. Contracts are often protracted in length and are replete with byzantine terms.

Such excesses have long prompted the disapprobation of the most influential within society. Most religions of the world rightly chastise such practices for what they are: usury. Payday lending does, of course, serve a needed purpose, but it may be conducted with appropriate constraints. This are the idea employed by most other major municipalities within Texas, such as Austin and Dallas, who have already enacted needed ordinances to reign in the excesses of this industry. These ordinances, by and large, require the lenders to register with the City, strongly regulate how straightforward a contract may be, limit the principal of these loans and robustly curtail abuses of the refinancing of these loans. Unfortunately, a general limit on the interest rate was not included.

Tomorrow, the Houston City Council will debate including the aforementioned regulations in its code of ordinances. The issue, which has long eluded Houston as its contemporaries enacted the regulations, has occurred thanks to a zealous push by Mayor Parker to enact her progressive vision for the City. This board strongly supports the ordinance and hopes that the City Council will as well.

Click here to read the rest of the editorial!

Civil Affairs: Parker’s night


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This past Saturday night was my last weekend evening in Boston as a resident. Despite this, I could find no better activity for the night than to meticulously follow and live-blog the Houston municipal runoff elections. Albeit, most of my friends have either gone home for Christmas or are intensely studying, and it did not help anyone’s social life that a foot of snow fell upon Boston over the weekend.

Click here to read Horwitz’s column!

The Empire Strikes Back

The progressive one, anyhow.

Amid painfully low voter turnout of less than 4%, it became abundantly clear that the progressives* had showed up in force last night *–I use the term progressive, not ‘liberal’ or ‘Democrat,’ in this context because the Council is far more diverse, with Conservative Democrats like Andrew Burks and Progressive Republicans like Stephen Costello. Two incumbent City Councilmembers were defeated for re-election and an open seat saw a repudiation of the longstanding political dynamic there. In many respects, this is the realignment of the City Council from the blunders of 2011.

There were also three elections for the HCC Board, two of which also featured incumbents losing their re-election bids. Particularly of note here was the loss of Yolanda Navarro-Flores, who has an accomplished political career. A longtime HCC Trustee and former member of the Texas House of Representatives, she has also run unsuccessful campaigns for the City Council and the State Senate. According to Off the Kuff, Navarro-Flores allegedly engaged in some pretty unseemly and homophobic tactics throughout the election. Despite having roughly a 23 point lead in November and just being a few votes shy of outright victory, she lost by a whopping 6 points on last night. Despite doing very well in absentee votes, she lost Election Day votes by 24 points. Goes to show what motivating your base will do for you.

Click here to read more!

Mudslinging in District I

First, the Houston Chronicle compiled an outline of the runoff election in District, between Graciana Garces and Robert Gallegos. As I noted about three weeks ago, the election looks to be a perfect carbon-copy of the special election for District 6 of the Texas Senate earlier this year. In that election, Sylvia Garcia (the former boss of Gallegos) defeated Carol Alvarado (the former boss of Garces) in the runoff that was ultimately held.

The Chronicle article, however, does not really note the policy differences that the two candidates have. Texpatriate endorsed Sylvia Garcia in March, just as how we endorsed Robert Gallegos in November, largely for the disquieting contributors of their respective opponents’ campaigns. Both Alvarado and (more timely) Garces have been funded in no small part by the payday lending lobby. Additionally, Councilmember James Rodriguez (to which Garces is actually the Chief of Staff) has been fighting against a recent proposal to regulate these payday lenders, and Garces has remained strangely silent and opaque on the issue. Her campaign continues to insist that she has not taken a definitive position, though I remain rather skeptical. Gallegos, on the other hand, is an ardent supporter.

Click here to read more about the mudslinging in District I!

Council update, 12/11

The Houston City Council took no major action this week, as Councilmembers high and low tagged proposals to delay them for one week. Instead, the only updates we have are those that seek to prognosticate towards the future involving existing proposals, almost all of which were pushed back by the dilatory tactic.

First, KPRC is reporting on a proposal to relax the City’s alcohol sales ordinance, which bans any store from selling beer or wine within 1000 feet to a school or a church. Mayor Parker has now proposed easing the regulation to 300 feet, applying only to “larger grocery stores.” I have no idea what the cutoff between a small store and a large grocery store is, and I am in no small part concerned about the possibility that this is an olive branch to Wal-Mart and the like. That being said, perhaps I am just misreading all of it.

The proposal is meant to attract more grocery stores to low-income areas, where very small churches are often ubiquitously located in strip-malls alongside shopping centers. These low-income areas are often called Food Deserts for the scarcity of healthy eating and shopping options nearby. The Houston Chronicle recently cataloged these problems, citing efforts by the City to help alleviate the problems.

Click here to read about the Payday Lending ordinance and why it is in jeopardy!

Thou shall not be a Usurer, Part III

Nearly two weeks ago, Mayor Parker announced an ambitious plan to regulate Payday lenders. The proposed ordinance, which was largely crafted by City Attorney David Feldman, was modeled after other municipal ordinances currently in place throughout the State, including in Austin, Dallas, El Paso and San Antonio. The ordinance requires, among other provisions, the loan sharks usurers lenders register with the city and provide easy to understand, concise contracts. Additionally, certain interest rates are capped and predatory tricks are forbidden. The ordinance immediately received somewhat harsh pushback from the business community.

Since the State of Texas does not have uniform regulations on these stores, a legitimate concern exists that the passage of the regulation will simply drive the institutions en masse to just outside the City limits. Accordingly, the usurious and predatory tactics will persist, but the City of Houston would lose the tax base. Such a solution would not work for anyone, and is similar to the rationale I have used in the past to discourage municipalities or even smaller States from unilaterally raising the minimum wage too far off the national base value.

Anyways, as promised, Mayor Parker officially presented this ordinance to the City Council this morning, with a tentative vote planned for next Tuesday. Today, a fair share of City Councilmember expressed strong reservations with the measure while many more were quite supportive.

Click here to read more about who opposes this ordinance!

Payday lending in Houston

Earlier this year, the Texas Senate passed a bill regulating payday lending by, among other provisions, capping the amount of  interest that may be served in Payday or Auto title loans. These loans are often the last refuge of those facing financial ruin, and all-too-likely unsuspecting borrowers are coaxed into a vicious cycle categorized by usurious interest rates. The proposal, however weak it was, died upon arrival in the Texas House.

Many municipalities in the State, however, regulate the businesses themselves. These include Austin, Dallas, El Paso and San Antonio (as well as smaller cities), all of whom have passed nearly identical ordinances. Today, Mayor Parker announced she would introduce the same regulations to Houston.

Speaking to press corps gathered at City Hall, Mayor Parker announced she would introduce these regulations to the City Council at the next meeting: December 4th. The following meeting, December 11th, would tentatively feature a vote on the regulations, with Parker adamant about accomplishing the passage of this ordinance by the end of the year. I also saw Finance Committee Chair, Councilmember Stephen Costello at the meeting. There may have been other officials there as well.

Click here to read more exactly what this ordinance would do, as well Mayor Parker’s words!