Ohio Leaders Take on Payday Ballot Issue, Deception by Mortgage Brokers while School Officials Fret over Sour Mood of Voters

OhioNewsBureau

COLUMBUS, OHIO: In the continuing battle between state leaders and the payday lending community, which lost big a few months ago when Ohio lawmakers reformed its industry by reducing the yearly percentage a borrower has to pay on a two week loan from 391 percent to 28 percent, Gov. Ted Strickland, House Speaker Jon Husted and Senate President Bill Harris trioed up again to serve as honorary co-chairs of a campaign to defeat the ballot issue payday lenders hope to have on the November ballot that would undo the legislative reform they say will put their industry out of business and the approximately 6,000 people who work in it out of a job.

Three Musketeers of Ohio Politics Rally to Defeat Payday Lenders

In a media release sent to OhioNewsBureau by the Coalition on Homelessness and Housing in Ohio, the group of consumer, labor and housing advocates that successfully pushed legislation through the General Assembly that reformed practices for offering short-term loans, one Democrat, Strickland, and two Republicans, Husted and Harris, said the new law will protect Ohio families by reducing the interest they have paid on two week loans, a factor bill supporters said led to a cycle of increasing debt as borrowers returned for more loans to pay off previous loans and unwanted expenses they could not pay for themselves.

Coalition leaders said they couldn’t match the money payday lenders have put into winning at the ballot, but said the effort of Strickland, Husted and Harris, when combined with the “truth” would help defeat the well-funded campaign payday lenders are conducting.

Defending payday lenders was Kim Norris, spokesman for the industry, who told Ohio Statehouse radio reporter Bill Cohen that Strickland, Husted and Harris are limiting the choices available to Ohioans she said know the value of money, and who, because they have limited choices, will pay more in bounced check fees and other payments industry supporters say represent an interest rate higher than what state leaders and coalition partners say about their super high lending rates.

Husted, who normally touts the benefits of the free markets as Republicans are wont to do, said the defective nature of the payday loan product “undermines free market principles” and contributes to “our nation’s problem with debt.

Readers can only wonder if Messrs. Husted and Harris will invest more time watching “I.O.U.S.A.,” a documentary film that says the mountain of debt towering over the United States could make the Great Depression look like a market correction, than President Bush has spent watching “An Inconvenient Truth,” Al Gore’s Nobel Prize winning documentary on global warming and what to do about it.

If Husted and Harris were as concerned about our national debt as they say they are about the debt some Ohio families have accumulated through payday lenders, they certainly haven’t tapped President Bush on the shoulder about the more than $400 billion deficit he will leave the next president.

AG Goes After Mortgage Brokers

In a joint effort by the Ohio Attorney General and the Department of Commerce to hunt and prosecute mortgage brokers who have violated Ohio’s predatory lending law, also known as the Ohio Homebuyers Protection Act (HPA), but who have gone unpunished, a media release to OhioNewsBureau said complaints were filed against two mortgage brokers – Magellan Mortgage Corporation and Highland Banc Inc. – and an individual loan officer and appraiser for engaging in unfair, deceptive and unconscionable acts and practices.

The complaints allege that these brokers conducted their business with “rampant disregard for the HPA, resulting in the consumers being misled into loans they couldn’t afford.

If successful, the lawsuits demand the companies and individuals to reimburse all consumers who were harmed by their actions and to pay civil penalties of $25,000 for each violation.

In a comment sent to ONB from DOC spokesman Dennis Ginty, seeking injunctive relief fro the court the two companies from continuing to violate the Mortgage Broker Act was done to “protect the public as they seek financing for their mortgage loans.”

The AG’s office did not respond in time for this article to questions asked by ONB regarding the value in dollars of the offenses.

Ohio Voters Give Failing Grades to Most August School Building, Operating Levies

For a state that has fought over education funding for more than a decade, the resounding turndown by voters of most school building and operating levies on the August ballot signal that pocket books have little if any spare change to throw to schools in the form of higher property or income taxes.

With gas, energy and food prices rising as jobs prospects decline, Ohioans are weary of costs school boards need to build new schools or renovate old ones. Of the 32 tax requests across the state, 72 percent were voted down, a slight improvement from last year. The average approval rate in August for school levies is 1 in 3. Furthermore, of the dozen emergency operating levies, voters only said yes to four.

The August elections, which some say produce far fewer voters than General Elections and can give school levy supporters an edge over critics, saw dozens of levies downed as voters, sometimes by narrow margins, said no to paying more property or income taxes.

This defeat of so many school levies comes as Strickland pursues a dozen school-funding forums held around the state to gather public comments he and his top staffers will use to propose a solid funding fix for schools next year.

Strickland says that no matter what he does during his first term of governor, if he doesn’t solve the school funding puzzle, he will consider it a failure. But his chances to have his funding fix plan will be easier if Democrats take control of the Ohio House, as many political prognosticators say will happen during a presidential year that has many voters looking for an alternative to President Bush, the Republican Party and its candidates. Ohio Democrats need to gain four seats to take control of the Ohio House.

John Michael Spinelli is a former Ohio Statehouse government and political reporter and business columnist. He now serves as the OhioNews Bureau Chief for ePluribus Media Journal. Find ONB archives here.
Photo credits: (c) 2008 AnHarris, istockphoto

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