Thursday, October 5, 2006

According to a report from Arizona Central, Tom Rawles told Mesa City Council Members he'd be voting "no" before a formal date was even set for a public hearing.

Rawles made his stand during Monday night's city council meeting. On October. 16, Mesa residents can tell him to his face whether or not they agree with him.

What's the issue at stake? A proposed ordinance that would establish a minimum distance of 1,200 feet between new cash loan shops. Existing shops would not be affected.

Rawles has said repeatedly that this type of government regulation is tantamount to a racist public policy. Mayor Keno Hawker and Councilman Scott Somers have said they are leaning toward also voting it down. They agree with another reason Rawles opposes the ordinance: Government should not have the power to intrude upon the free market.

"They fill a niche," Somers said in an interview. "They offer small, short term loans that no other business does."

However, Vice Mayor Claudia Walters says she is pushing for the ordinance. Quick cash advance stores are mushrooming in west Mesa, which Walters represents, and residents there don't like it.

"People are concerned when they see (payday loan stores) that it indicates a neighborhood decline," Walters said last week.

The number of regular and/or faxless payday loan operations located in Mesa has nearly doubled in two years. As of July, the city was home to 111, said Gordon Sheffield, a Mesa zoning administrator. In July 2004, there were 63.

The businesses are considered "financial office(s), similar to a bank," Sheffield said. Therefore, anyone who wants to open a cash advance shop may do so where zoning designations permit it. As of September 2005, the number of payday loan stores in Arizona had nearly tripled to 610, and there were more offices across the state than McDonald's restaurants and Starbucks coffee shops combined.

Arizona had a higher number of instant cash loan offices per capita than the national average. The Arizona Republic last year found that 70 percent of payday loan offices in Maricopa County are congregated in low- to middle-income areas where the median household income is below $45,000, the county average.

Overall, payday advance offices in the county collect about $99 million a year in interest or fees.

This entry was posted on Thursday, October 5th, 2006 at 6:02 am and is filed under Arizona.