Long Beach, September 18, 2013–The Long Beach City Council voted 8-0 last night to enact an ordinance restricting the growth of new check cashers, payday and auto title lenders and other fringe financial entities throughout the city.
The “Financial Services Ordinance” will create a buffer zone of at least 1,320 feet between fringe financial storefronts, requires a conditional use permit and sets forth operational standards these businesses must follow.
Liana Molina, the payday campaign organizer with the California Reinvestment Coalition, applauded the council’s vote and the advocacy carried out by neighborhood leaders and community organizations to pass the ordinance. She explained, “This ordinance is a strong step forward in addressing the over-proliferation of high cost, predatory lenders and alternative financial services throughout the city. The community is working hard to transform and improve various neighborhoods in Long Beach, and this ordinance is an important tool that will help protect neighborhoods from being targeted by this industry.”
Mauna Eichner and Lee Fukui, residents of Wrigley, are part of a group of community leaders who advocated for the ordinance. They explain, “Predatory lenders depress our neighborhood and strip money out of our local economy, right out of the pockets of our neighbors who can least afford it. Tonight the city council did the right thing and sent a strong message that the vitality of Long Beach residents and neighborhoods is more important than profits made off of loans with upwards of 450% interest rates. We are pleased with the Council’s decision and are confident that this policy will help advance our goals of making Long Beach a great place to live.”
Additional Background on Payday Lenders and other fringe lenders:
CRC is working with Fresno community leaders to restrict payday lending in their city, and is part of the Coalition against Payday Predators, that successfully advocated for limiting payday lending in San Jose and is working to restrict payday lending in Sunnyvale and Gilroy.
A state bill, SB 515 supported by advocates including the California Reinvestment Coalition, the Center for Responsible Lending, the Law Foundation of Silicon Valley and National Council of La Raza, would have limited the number of loans a person can receive annually, and also would have lengthened the amount of time borrowers have to pay back the loan. SB 515 was defeated in the Senate Banking Committee and did not move forward in 2013.
Are you a Californian who has used a payday loan and would like to share your story? Do you want to get involved in local efforts to restrict payday lending in our communities? If so, please contact Liana Molina, CRC’s Payday Campaign Organizer: Liana@calreinvest.org or 415-864-3980.
To stay up to date on financial justice issues in California, especially as they relate to low income communities, and communities of color, you can follow the California Reinvestment Coalition on our Facebook page, via Twitter, watch our movies on ourYouTube Channel, sign up to receive our newsletter and action alerts, and of course, visit our website.