published Monday, February 7th, 2011

Hamilton County Commissioner Tim Boyd wants fees for payday lenders


by Dan Whisenhunt
  • photo
    District 8, Hamilton County Commission Tim Boyd speaks on October 12, 2010.
    Staff Photo by Laura-Chase McGehee

Hamilton County Commissioner Tim Boyd wants the state Legislature to make payday lenders pay more money to local governments, but two lending companies said they would oppose any new fees.

Boyd spoke before the county's legislative delegation in December and asked them to consider "transaction fees" on payday lenders, check cashing companies and title pawn companies, to generate revenue for cities. There are no details on what the fees would be or how they would be collected. Under his plan cities would have the option to establish fees.

State Rep. Vince Dean, R-East Ridge, said the proposed bill filing deadline is Feb. 17, but he has not agreed to sponsor a bill based on Boyd's proposal. He also is not aware of any other legislators who might be interested in sponsoring a bill.

The lenders, which typically loan smaller amounts of money than a traditional bank, do not generate sales taxes, but Boyd said these businesses use city services.

"I would like for them to let the municipalities have an option to charge transaction fees on these unregulated lenders," Boyd said. "To me it's just fair. Out here in East Ridge there's a disproportionate number of them, and they don't collect any sales tax like their neighbors."

Boyd said these companies flourish in East Ridge. East Ridge Mayor Brent Lambert said he's heard of Boyd's proposal but said he would need to be sure a transaction fee would be legal under state law. He said by his count there are at least two dozen of the companies in East Ridge, most of them along Ringgold Road.

"If we cleared that hurdle, it certainly would be within the realm of consideration," Lambert said.

Chattanooga City Council Chairman Manny Rico said he needs to know more about Boyd's proposal. He said fees could have the consequence of harming the poor, who depend on these services.

Red Bank Mayor Monty Millard also said he needs to study the issue more.

Ryan Harris, a spokesman for Cleveland, Tenn.-based Check Into Cash, which operates a store in East Ridge, said the company would not welcome the fees.

"Our company pays numerous different kinds of taxes," Harris said. "Each transaction is regulated at the state and federal level, as well as providing jobs and paying rent to local landlords. Obviously we would be strongly opposed to being singled out for any kind of additional tax."

Marian Allen, branch manager of Check Advance of America in East Ridge, called Boyd's proposal a "bad idea."

"I don't think it would help the check advance companies at all because that would be more revenue they're paying out," Allen said.

Dean said Boyd's idea is "something we probably should look at." Dean said he understands the issue from his time on the East Ridge City Council. But he also said there's another side to the argument that should be considered.

"If those businesses were to go out of business, there would be that many vacant buildings in East Ridge," he said. "It already has a lot of vacant buildings, so they have to weigh that into consideration. They have to determine whether they would rather have those businesses or vacant buildings."

Contact staff writer Dan Whisenhunt at dwhisenhunt@timesfreepress.com or 423-757-6481.



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about Dan Whisenhunt...

Dan Whisenhunt covers Hamilton County government for the Times Free Press. A native of Mobile, Ala., Dan earned a degree in broadcast journalism from the University of Alabama. He won first place for best in-depth news coverage in the 2010 Alabama Press Association contest; the FOI-First Amendment Award in the 2007 Alabama Press Association contest; first place for best public service story in the Alabama AP Managing Editors contest in 2009 for economic coverage; and ...

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jpo3136 said...

Payday lenders were once listed, in some report I cannot remember, as massive contributors to Senator Corker's campaign.

Wasn't Tim Boyd just recently asking for a massive tax break and local investors to start a Big Pharma deal? I remember seeing this same photo in such a story.

Watch out for the hook in this bait.

Payday lenders are predatory credit agencies. If they can get cities hooked on their profit margin, then payday lending companies will be able to change their image so that they will look like they're a positive contributor to government coffers.

We want them to remain as they are: known as unethical lenders. Payday lending transactions are illegal for many in the military because the terms violate the Uniform Code of Military Justice's prohibitions on indebtedness. The terms of the agreement are that bad.

It's cheaper to deliberately make yourself a victim of theft than to participate in a 400+% annual interest rate deal. At least with the theft, the loss won't compound so aggressively.

Reject this deal. East Ridge does not need to get hooked on payday lender fees. Wrong answer. East Ridge needs to cultivate better industries, better businesses, and a better life for local people.

Don't let these people get the small end of the wedge in. Reject this fee addiction deal from payday lenders.

February 7, 2011 at 1:17 a.m.
dendod said...

Good idea Commissioner Boyd. Go easy on them though. Maybe just tax them at the rate they charge interest. And let them pay weekly so you can bleed them like they bleed their customers. Slowly and painfully. They have no shame. Praying on the poor.

February 7, 2011 at 7:49 a.m.
BOOBOO99 said...

Tim Boyd is an idiot. Payday Lenders are regulated by state and federal.. This guy dont have his Facts in order. How did this Knitwit become a Hamilton County Commissioner,He wants to add more fees to the poor people to make his pocket rich...This thug needs to be in jail for his shady dealing trying to rip off people in Hamilton County...I bet his kids are proud of him..lol Rob from the Poor and Give to the rich thats Tim Boyds motto!!! Get this Douchbag out of office.

February 10, 2011 at 10:42 a.m.
AliceS said...

We have people fighting for freedom so that we can have other people make our decisions for us because we are uncapable of taking care of ourselves? Grow up people! Take care of yourselves, quit worrying about what other people do. If you don't want to take out the pay day loan then don't, of your neighbor does then let them be. I've applied earlier for a loan with https://paydayloansat.com/ then repay it in full and have any troubles.

August 15, 2012 at 3:51 p.m.
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