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With Ohio House committees back from summer recess this week, the

Ohioans for Payday Loan Reform (OFPLR) coalition is pushing for

House leaders to hold hearings urgently on HB 123, the bipartisan
proposal introduced in March to reform payday loans and protect Ohio

Ohioans for Payday Loan Reform (OFPLR), numbering more than 100
organizations and individuals around the state, is disappointed by the
legislative inaction on the measure to date, but is hopeful the legislature
will take up the matter this fall. Each day without reform is costing
Ohioans more than $200,000. The bill would bring relief to more than 1
million Ohioans who use payday loans and support for the measure
exists in communities across the state. The bill sponsors, Republican
Rep. Kyle Koehler and Democrat Rep. Mike Ashford, acknowledged the
broad support saying, our colleagues on both sides of the aisle agree
that this is not a partisan issuethis is an issue about whats best for
Ohios residents and the states economy.

Standing in the way of reforms are well-connected payday lenders. We

have been beyond patient and respectful of the legislative process, but it
is very clear that payday lenders will use whatever means they can,
including hiring dozens of lobbyists, to stall this important discussion and
to stop a public hearing, said Carl Ruby, a Springfield pastor and one of
the coalition leaders. The facts are on our side and Ohio voters of every
stripe agree that reform is need, so we are hopeful to see progress in the
near future.

Following is an overview on the bill, where it stands and some facts

about the coalition and payday lending in Ohio.

What is HB 123?
Ohio has the embarrassing distinction of having the highest interest
rates for payday loans in the nation, with rates averaging 591%. A bi-
partisan bill, HB 123 seeks to establish terms which would be fair for
both borrowers and lenders. It would:

Establish a maximum interest rate on such loans of 28% plus a

maximum monthly fee of $20.
Amend Ohios Credit Services Organizations (CSO) Act, Small Loan
Act, and Mortgage Loan Act and Short-Term Loan Act. If passed, small
dollar lenders, ie. payday lenders, could not offer high-cost small loans
using the legal loophole that they use today to broker loans with
unlimited fees.
Hold online lenders accountable to the same rules as storefronts.
Shield 95% of a borrowers income from lenders. This would limit
payments to about $60 every two weeks for the average person.
Currently, ordinary payday loans are due in full after two weeks, causing
borrowers to lose 1/3rd or more of their paychecks.

Where does the bill stand?

The bill, which was introduced in March, is sponsored by Reps. Kyle
Koehler, R-Springfield, and Mike Ashford, D-Toledo.
Speaker Rosenberger assigned HB 123 to the House Government &
Accountability Committee, which is chaired by Rep. Bill Blessing, R-
Colerain Township.
Prior to the Houses summer recess, meetings about the bill were held
with House leaders, during which they heard from policy experts,
borrowers, supporters of reform, and lobbyists representing payday
Reps. Koehler and Ashford are pushing for a hearing on the bill as the
House reconvenes this month.

Who uses payday loans and how will they be impacted?

There are more than 650 payday lending storefronts throughout
About 1 million Ohioans - 1 in 10 adults - have used a payday loan.
Ohioans who use payday loans spend an estimated $145 million on
fees annually. Most of those dollars flow out of Ohio because two-thirds
of payday loan stores here are operated by companies located out of
If the bill becomes law, it will save Ohioans an estimated $75 million
each year.
Legislation for a 28% APR rate cap on payday loans was passed in
2008 in Ohio and voters overwhelmingly endorsed it that same year on a
statewide ballot initiative. But the payday loan industry found a loophole
that has permitted them to ignore that law and continue to charge
exorbitant rates.

What is Ohioans for Payday Loan Reform?

A coalition of more than 150 community, government, social service,
veterans and faith organizations and individuals throughout the state
supports HB 123. The coalition is engaged in meetings, planning events
in local communities, as well as a rally at the Statehouse.
Coalition members include the Springfield Chamber of Commerce,
United Way organizations of Greater Cleveland and Toledo, Ohio Job
and Family Services Directors Association, Ohio Council of Churches,
Catholic Conference of Ohio, Ohio Poverty Law Center, Ohio CDC
Association, Northeast Ohio Mayors and City Managers Association,
Ohio Association of Community Action Agencies, Voices for Ohios
Children, housing services organizations throughout Ohio and Lake,
Franklin and Cuyahoga County Veterans Services Commissions, and
many more.

Will Ohios legislative leaders do the right thing and get discussion
moving on an important issue?