If a legal business offers a product like payday loans – a product for which there is a proven demand – the efforts of local governments to restrict payday lenders through cutthroat zoning policies are at best questionable, says the Payday Pundit. NWI.com reports that the Lansing, Mich., Planning and Zoning Board is looking for ways to revise ordinances to phase bad credit loans out of town. In light of Michigan’s HB 4214 legislation, which enables Gov. Rick Snyder to declare “financial martial law” and install an emergency financial manager (EFM) when a city’s economy fails, kicking legitimate business out of any town becomes problematic.
Revising ‘special use’ provisions
Lansing’s Planning and Zoning Board of Appeals has been poring over the city’s “special use” zoning provisions, ostensibly as a check-up to see if any changes need to be made. It cannot be coincidental, however, that the board’s suggestions for changes primarily targeted payday lenders. Parking near churches in residential neighborhoods and limiting the number of in-home day care centers may have its civic import, but the business of bad credit loans boosts both credit-constrained consumers’ ability to avoid insolvency through credit default and a city’s economy as a whole.
While the proposed zoning change would only prevent new payday loans outlets from locating in Lansing, critics see such a move as the typical first step against an enterprise lawmakers want to covertly torpedo. Passing it off as encouraging “more variety in the types of companies” that call Lansing home, which is how Trustee Mikal Stole explained the proposal to NWI, is a smokescreen.
Where there’s smoke, there’s fire
Michigan House Bill 4214 — which state AFL-CIO president Mark Gaffney called “an assault on democracy” and Detroit Rep. John Conyers warned would give a state government-appointed “financial czar” (EFM) the power to “force a municipality” like Lansing into bankruptcy — has already scorched state soil. The political powers of Benton Harbor, Mich., officials have been superseded by a newly appointed EFM who will take control of the municipality. The economy of the small town may be bad enough to warrant dissolution, a power HB 4214 grants to a governor-appointed EFM.
According to the Rachel Maddow Blog, Benton Harbor’s per capita income is $8,965, the lowest in Michigan. Just across the St. Joseph River from Benton Harbor stands local “Twin City” St. Joseph, which boasts a higher PCI, $24,949. This is significant because Benton Harbor is the home of the Whirlpool company, which is celebrating its 100th anniversary this year. But the company is celebrating it on the “other side of the tracks,” in St. Joseph.
The people of Benton Harbor would no doubt like to see its revenue-producing businesses stay home. When it comes to payday loans, Lansing should be concerned about keeping its moneymakers around because a financial czar could be waiting in the wings.