Fri, Dec 05, 2008

Tucson Region

arizona

Payday loan group beefs up campaign

By Howard Fischer
Capitol Media Services
Tucson, Arizona | Published: 09.16.2008
PHOENIX — Payday lenders funneled another nearly $2.4 million into their campaign Monday in an effort to persuade voters to let them stay in business.
The new cash infusion brings total donations so far to nearly $11.6 million, all from the association made up of firms that make payday loans.
No other measure on this year's ballot comes close in spending, and there are still seven weeks to go until the election.
Industry spokesman Stan Barnes would not say how much the lenders are planning to put into the campaign for Proposition 200.
"We're going to spend what it takes to educate voters on an industry that most voters know nothing about," he said.
Barnes said, though, it is unlikely the campaign will break the record of $21.1 million spent by Indian tribes in 2002 when they persuaded voters to allow them to expand casino gaming — and to legally prevent anyone else from getting in the same business — in exchange for giving a share of profits to the state.
The payday lenders, operating under the banner of "Arizonans for Financial Reform," are billing Proposition 200 as a method of revamping the industry and its statewide network of stores. A series of mailings to homes of registered voters has promised the changes would reduce costs to those who take the two-week loans as well as reduce the number of lenders operating in the state.
But Barnes acknowledged the main reason for such heavy spending on the initiative is to allow payday loan shops to remain in business after July 1, 2010 — the day the decade-old statute authorizing the practice and the high rates associated with the high-risk, short-term loans expires.
Foes, organized as "Stop Payday Predators," have so far reported contributions of less than $125,000.
They argue there are sufficient alternatives to payday loans for many people or that there eventually will be other options for those who lack credit ratings for traditional loans.