You might soon see two petitions about one controversial topic: payday loans.
Short term lending - or payday lending - interest rates are largely unregulated in South Dakota, and the average rate in the state is at 574 percent. South Dakotans for Responsible Lending want voters to cap the interest rate at 36 percent.
We've introduced you to this group before, and its goal is to put a measure on the ballot to let voters decide.
Now a different group with a very similar name is laying the groundwork for a petition that promises to cap interest at 18 percent. While 18 percent might sound good, opponents say otherwise.
"It's a decoy. It's a decoy petition, " Steve Hildebrand said.
South Dakotans for Responsible Lending member Steve Hildebrand says the payday lending industry is behind this effort. According to Kea Warne, the Deputy Secretary of State, Elections Services, nobody or group has filed any paperwork with the Secretary of State's Office.
However, Warne says a group from North Sioux City called South Dakotans for Fair Lending Ballot Question Committee is working with the Legislative Research Council to draft language for a potential petition.
Right now, the language states, "no lender may charge interest for the loan or use of money in excess of 18-percent." However, there is also a line, stating, "unless the borrower agrees to another rate in writing." This means you could still pay interest rates much higher than 18 percent, so Hildebrand says this other effort would not really change anything in South Dakota.
"They're not going to lend you money at 18-percent. They're going to say, if you want money from us, you have to sign this form and opt out of that 18 percent and charge you 574 percent, " Hildebrand said.
Similar attempts have popped up in other states, including Missouri. Hildebrand and fellow member Steve Hickey believe this is an attempt to confuse voters.
"If it makes it on the ballot, friends, this is a constitutional amendment they're forever ensconcing in South Dakota law to make payday lending unbridled. It keeps the legislature out of it, they can't change it. It's a terrible way to go about this, " Hickey said.
The South Dakotans for Fair Lending Ballot Question Committee only lists one contact name, Lisa Furlong. KELOLAND News called the number listed and left a message. No one called back by the time this story aired.
KELOLAND News also called at least 16 short term lenders to discuss the new proposal, and the efforts to cap loan interest rates. We were told "no comment". In some cases, an employee referred us to a corporate office, which then referred us back to a local store. In other cases, the phone numbers were disconnected. One owner does say that capping interest rates at 36-percent would, "shut down the industry."
Hildebrand and Hickey disagree. In addition to circulating their own petitions, Hildebrand and Hickey are now explaining to voters the difference between the two groups. They do not have any plans to give up their goal.
John Callaway (August 22, 1936 – June 23, 2009) was an American journalist, who appeared on radio and television as a host, interviewer and moderator. He was the original host of Chicago Tonight, a nightly news program broadcast on the Chicago, Illinois television station WTTW, serving in that role from 1984 to 1999.
John Callaway was born and...
To amend the Truth in Lending Act to establish additional payday loan disclosure requirements and other protections for consumers, and for other purposes.