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Powerful lobbyists have a grip on the leadership of the General Assembly, which is only too happy to allow the continued immersion of the most vulnerable Rhode Islanders
the Senate Committee on Commerce met on Tuesday afternoon to consider a bill, S0191, which would repeal the part of Rhode Island law that allows for the continued existence of payday loan companies. According to Institute of Economic Progress, payday loans are high cost loans designed to perpetuate “a continuous cycle of debt”. These businesses locate in economically struggling communities, often becoming the only option when people need money. Rather than helping people during tough economic times, payday lenders trap people in debt with loans of up to 260 percent APR.
This obvious evil is banned throughout the Northeastern United States, with only Maine, Delaware and Rhode Island allowing practice. Senator Harold Metts (Democrat, District 6, Providence) introduced the bill six times in six years, to no avail. The bill also fails the House every year, and it is easy to see why.
Powerful and well-funded lobbyists who maintain close relationships with the leaders of the Rhode Island General Assembly prevent the passage of this bill, ensuring that leaders of the General Assembly, such as the President of the Senate Dominique ruggerio (Democrat, District 4, Providence) and Speaker of the House Nicolas Mattiello (Democrat, District 15, Cranston) complicit in the payday lending practice that dries up the most vulnerable in Rhode Islanders with fees of about $ 7.6 million a year.
The Senate Trade Committee meeting was held in one room, 212, without cameras and audio recording. When I walked in and set up my camera, one of the women working in the office asked if I was recording the meeting. I assured him that I was. She left the room. The room was full of lobbyists for payday loan companies such as Axcess Financial and Advancing America. These lobbyists included the former Speaker of the House William murphy (Democrat, District 26, West Warwick). Advance America pays Murphy $ 30,000 per year to ensure that payday loans are never banned in Rhode Island.
This item of Journal of Providence describes the close relationship between President Mattiello and former President, now lobbyist, William Murphy.
Before the start of the meeting, the Senate Majority Leader Michael mccaffrey (Democrat, District 29, Warwick) walked into the room and reached out to lobbyists. He also attended a few minutes of the proceedings, since as majority leader McCaffrey sits ex officio in all Senate committees. He left when I started to testify, but the meeting was then monitored by the Director of Communications of the Senate. Greg Paré.
No one directly representing the payday loan industry spoke at the hearing. Instead, the industry has relied on written testimonials from Carole stewart, Senior Vice President of Government Affairs at Advance America and oral testimony from Bill staderman, president of the Rhode Island Financial Services Association. Staderman began his testimony by saying that he was not a lobbyist.
The testimony against payday loans included written testimonies from Counting Rhode Island Children, The Rhode Island State Human Rights Commission, Alain krinsky of the Institute of Economic Progress, and Kelly rogers from the general treasurer’s office Seth Magazine. Krinsky and Rogers also presented oral testimony.
It was never a contest, of course. Most senators did not even bother to show up to the committee meeting, or if they did, cut early. Chair Roger picard (Democrat, District 20, Woonsocket) was absent, leaving the committee to the vice president Ana Quezada (Democrat, District 2, Providence). Admirably, Quezada is a co-sponsor of the Metts bill and has expressed his desire to get this bill passed this year. The only Republican on the committee, the Senator Elaine morgan (District 34, Exeter Hopkinton, Richmond, West Greenwich) never made an appearance, but the Senate Minority Leader Dennis Algiers (Republican, District 38, Westerly, Charlestown) poked his head in the doorway long enough to authorize the meeting. Senator Hanna gallo (Democrat, District 27, Cranston) was in and out of the meeting, present for Staderman’s pro-payday loan testimony, absent for most of the rest of the testimony, who was all against payday loans.
This left the committee in the hands of Senators Quezada, Samuel bell (Democrat, District 5, Providence) and Franck Lombardo (Democrat, District 25, Johnston). Bell opposes payday loans, Lombardo appears to favor them, based on his questioning.
After oral testimony, the committee voted 2-1 to retain the bill for further study, with Senator Bell dissenting.
The fight against payday loans in Rhode Island was once again vigorous, but just as doomed. the Rhode Island Interfaith Coalition to Reduce Poverty used to make payday loan elimination a top priority – Reverend Donnie Anderson formerly called payday loans “bad”- but the idea has fallen off the Coalition’s to-do list in recent years.
The fix concerns payday loans in Rhode Island. Too much money the wicked can earn by exploiting the poor and the vulnerable. And our General Assembly is complicit in this “evil”.
Here is the video of all the testimonials, followed by the written testimony. Oddly enough, when I asked for all the written testimonials, I didn’t get everything. I’ll modify the room when I get my hands on the rest.
Senator Metts introduced the bill:
You can watch Senate Majority Leader Michael McCaffrey rise and step out during my testimony:
Kelly Rogers from the Magaziner Treasurer’s Office:
Bill Staderman, president of the Rhode Island Association of Financial Services at one point, used a report by the libertarian funded by Koch Brothers Caton Institute to support his arguments. The Caton Institute is a leader in movement to cast doubt on the science of climate change, and a bad actor on many fronts.
Alan Krinsky from the Institute for Economic Progress:
Randall Rose:
Written testimony from Advance America payday lender:
Written testimony from the Economic Progress Institute:
Written testimony from Rhode Island Kids Count:
Written testimony from the Rhode Island State Human Rights Commission:
Written testimony from General Treasurer Seth Magaziner:
Here is the sign-up sheet which clearly indicates that there was a written testimony submitted by Nicolas hemond and Stephen alves which was not made available to me at my request. Hémond is paid $ 20,000 per year by Axcess Financial. Stephen Alves gets paid $ 40,000 per year by Axcess Financial.
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