For Immediate Release

Contact: Nancy Lesic, nlesic@lesiccamper.com

Ohio House Leaders Cave to Payday Industry,

Pursue Sham Process That Fails To Close Loophole
Coalition calls on State Senate to push for true payday loan reform as Speaker Rosenberger
continues to deflect Ohioans’ call for action

COLUMBUS – March 22, 2018 – A grassroots coalition of Ohioans championing payday loan reform
came out strongly against a plan introduced today by House leadership. Leaders of Ohioans for Payday
Loan Reform see the proposals outlined by Speaker Pro Tempore Rep. Kirk Schuring as a sham that fails
to safeguard consumers from the harms of payday loans.

Among other shortcomings, Rep. Schuring’s proposals do not include the critical closing of a legal
loophole that payday lenders have slithered through, allowing them to ignore payday loan reforms
overwhelmingly approved by Ohio voters in 2008. This loophole allows lenders to charge highest-in-the-
nation rates with a typical loan carrying an APR of 591%. Today’s proposals don’t bring down prices or
achieve affordable payments.

The proposals were outlined in response to House Bill 123, a bipartisan bill stalled in committee for over
a year that would cap interest rates at 28% and provide other measures to protect working-class Ohio
families. That bill is modeled on Colorado’s successful law that dramatically reduced payday loan costs
and preserved widespread access to credit.

“Rep. Schuring’s proposal was crafted behind closed doors and without our input. It appears that he is
trying to create the illusion of reform, without addressing the core issues. It doesn't close loopholes and
doesn't cap costs” said Carl Ruby, a Springfield pastor who is a leader of Ohioans for Payday Loan
Reform. “I think Rep. Schuring can, and should, do better. We need to protect Ohio voters, not the
payday lenders.

“It’s a shame that Speaker Rosenberger has so little interest in protecting Ohioans, some of whom broke
down in tears in his office a year ago as they told him how they were devastated by payday lenders.
Back then he patted them on the back and promised to protect them. Now it seems that he is more
committed to protecting the lenders who have given him and other legislators more than a million
dollars in campaign contributions." The payday loan industry has given more than $1.6 million in Ohio
campaign contributions since 2009, according to The Columbus Dispatch.

In April 2017, Speaker Rosenberger met with several payday loan borrowers who had been trapped in
debt. When one of them, Denise Brooks, shared with him that her payday loan situation became so dire
that she considered suicide, Rosenberger told her he would support real reform to protect consumers
like her.
Upon learning that instead House leadership is championing a toothless plan, Brooks fumed: “I believed
Speaker Rosenberger when he said he had my back last year. But in the end he either stabbed us in the
back or handed payday lenders the knife.”

Core elements proposed today have failed in other states

The new direction that was unveiled today does not close the loophole in Ohio’s Credit Services
Organization (CSO) rules, which allows payday lenders to gouge borrowers. HB123 would close that
loophole.

The Pew Charitable Trusts Director of Consumer Finance, Nick Bourke, submitted written testimony to
the Committee, saying, in part: “Any attempt at reform that does not firmly close the CSO loophole
would be meaningless.” Bourke continued, “We urge you not to undermine the reasonable approach
presented in HB 123 by giving in to the fringe views of payday lenders.”

Nicholas DiNardo, a leader of the coalition and managing attorney for the Legal Aid Society of Southwest
Ohio, said in testimony that payday lenders’ practices are “not just unethical and immoral, but also
directly violate Ohio law, and yet the Ohio legislature has done nothing about them for the past 10
years. The last time that this body attempted reform, the payday lenders’ lobbyists saw to it that their
deceptive loan products and business practices would continue, despite the clear consensus of the
citizens of Ohio that these loans should be regulated.”

DiNardo said today’s proposals missed the purpose of the original reforms included in HB 123: Rep.
Schuring’s suggestions leave open payday lenders’ loophole and would allow them to keep charging four
times more than they do in other states. HB 123 would reduce the costs of these loans to a more
reasonable level. Today’s recommendations also would NOT ensure that loans have affordable
payments with ample time for borrowers to repay. Where HB 123 limits installment payments to 5
percent of each paycheck, the new proposal does not ensure affordability.

The coalition noted that other states like Utah, Nevada, Louisiana, Michigan, and Florida have tried
many of the recommendations proposed by Rep. Schuring--like databases, extended payment plans, and
cooling-off periods. After those changes, research shows loans in those states didn’t cost less, payments
were still unaffordable, and most consumers got trapped in debt, borrowing repeatedly.

“These proposals have already failed in other states,” said Michal Marcus, another coalition
leader. “These changes miss the boat and don’t go far enough in addressing Ohio’s problems. Ohioans
need real reform and not the cosmetic changes proposed.”

For all of these reasons, Ohioans for Payday Loan Reform is asking the Ohio Senate to step in.

“Ohio House leaders have squandered an opportunity to enact meaningful reform,” said Danielle Sydnor
of Cleveland, another coalition leader. “It’s time for the Ohio Senate leadership to do what Speaker
Rosenberger failed to do – advocate for true reform that will relieve our state of its embarrassing
distinction of having the highest payday loan prices in the nation. We will watch how the Senate
leadership reacts to Rosenberger’s failure to work on behalf of Ohio families who are being unfairly
gouged by payday lenders.”
###