"Lenders You Can Trust.  Only At Borrow Smart Stores!"


Prepare For An Unfriendly Legislative Session

January 21, 2008


As you know the 2008 legislative session kicks off in a couple of weeks.  This is beginning to shape up to be a very bad session for us!  This report is the *long version* of what we know about possible legislation at the moment.

First, the only bills we are absolutely sure of at the moment are the bills currently being promoted by State Banking.  These bills, if enacted, would have significant impact on our businesses.  As you may know, the Council for Fair Lending (Borrow Smart Alabama) has worked hard on the government relations and media relations front to promote our industry at the grass-roots level here in Alabama.  This effort has significantly improved our insight by improving communication with those who have strongly opposed us in the past.  Here is one example. Click here to go to our report from back in the fall and then scroll down the page to the subhead "CONCLUSION."  Then, click on the link that says "announcement with Black Caucus" and read all about our efforts with an important group.

To the best of our knowledge this is the first effort our industry (payday and title lenders) has made to reach out to this group.  They have always been on the opposite side of our industry and they have a significant influence in legislation.  As a result of our effort and the effort of our lobbyist, we have developed a good working relationship with the leadership and with many of the members.  We know from this that *some* (not all) of their members plan to introduce legislation.  These are some of the same members who have been behind legislation opposing our industry in the past.  So, this is a second possibility for legislation.

Third, you may recall the bills that came up last year that were sent to a senate committee chaired by Senator Byrne.  If so, you recall nothing passed.  We were just plain lucky and we dodged a major bullet when Byrne left the Senate.  We were (and are) clearly in their crosshairs.  Even though we dodged the bullet, everyone in the study group agreed they would continue to work on the legislation.  So, we are fairly certain this group in some form will return.

The bottom line is that we (payday and title lending) continue to be great targets for the politicians.  It is so critical that both of our trade associations (Modern and TPCA) continue the work they do in supporting cash advance and title lending respectively.  Borrow Smart is now engaged on the public media and the government front and we encourage everyone who cares about the survival of our industry in Alabama to join us in this important effort.  But first, you should support Modern and TPCA.  We view our effort as a compliment and enhancement to the effort of both trade groups.  Certainly, if you look at our membership and our leadership you see leaders from both associations -- except for the large national companies.  We hope in the future they too will work together with us to preserve our industry in Alabama. 


At Borrow Smart we firmly believe a professional, direct lobbying effort by our trade groups is absolutely essential!  But, the days of only having a lobbying effort and having meetings just to pass along information between members are about over (feel good meetings). Just look at the states around us if you have any doubts whatsoever (FL, GA, DC, PA, OR, NC).  They all had lobbying efforts and trade associations.  Where are they today? They are gone.  Out of business (here, here and here)!

If we want to be around in the months and years ahead we must take a strong stance at the grass roots level to get the truth out about our industry directly to the public.  That is what we do at Borrow Smart Alabama.  Our adversaries have sure done a great job of getting their message out!  You can see the results of their effort as noted by the state list above.

Remember, the old saying, "all politics are local."  That's why our focus is a grass-roots program to speak for our industry -- in this state, as one voice and to promote the truth to the public about our industry and about our customers here in Alabama.  The days of having our adversaries define us and what we do and trash us in the media, without any public response by our industry, are now over. 


So far,  we know all of this is working and we know without a doubt that the people who really count are hearing our message loud and clear.


From this report you can see, this is shaping up to be one of the most "legislatively active" years we have ever seen in our industry.  Thankfully, we have decent resources to deal with this.  To our knowledge no other state has put together a Borrow Smart type grass roots effort to combat the problems we face.  Without a full public campaign to compliment our legislative effort we stand a very strong chance of joining the list of states above.  Our adversaries know their formula works and they are counting on using it in each state until every single one of us are out of business.

Even with all our industry resources, we still face mighty significant obstacles this year.  We need the support and help from everyone who benefits from this industry -- not just a select few as we presently have.  And, our effort is not just lobbying, but more importantly, it is the support of our lobbying effort by spkeaking the truth about our industry and about our customers directly to the public!  It is work to change the public perception of our industry through well proven public communications techniques.  And, it is work to challenge the untruths created by our adversaries in the media.  We do this because we know this is what drives the legislative effort.

If no one does this our days are numbered.  And, if we don't do it, who will do it?