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Starkville extends moratorium on payday loan outfits


Tim Pratt



The Starkville Board of Aldermen Tuesday extended the moratorium on new check-cashing and high-interest loan businesses in the city.  


Approximately 20 companies, commonly referred to as "payday loan" businesses, car title loan businesses and check-cashing businesses operate in Starkville, with a majority of them located on Highway 12. 


Aldermen Tuesday voted 6-1 to continue denying privilege licenses and certificates of occupancy for new high-interest loan and check-cashing businesses for another 12 months, or until the board amends its comprehensive plan or zoning ordinance to regulate those businesses. A privilege license and certificate of occupancy are required for a lending business to operate in Starkville. 


The moratorium does not affect lending businesses already in the city, although upon the cessation of operations of existing businesses, for whatever reason, their privilege licenses and certificates of occupancy will not be valid for renewal or transference to another entity. 


Ward 3 Alderman Eric Parker was the only board member to vote against the moratorium extension, saying he fears family-owned businesses might not be able to renew or transfer privilege licenses and/or certificates of occupancy if "something happens" to the owner.  


Ward 2 Alderwoman Sandra Sistrunk proposed the moratorium extension and said she hopes the board can address lending businesses in the city''s comprehensive plan or zoning ordinance before another 12 months passes. She promised not to propose another extension. 


Sistrunk would not comment after the meeting on why she feels the city needs a moratorium on lending businesses and instead cited her statements from January of this year, when the board originally passed the moratorium. Then, she said check-cashing and loan businesses prey on low-income residents and make the city look unattractive.  


"These businesses impact our community economy, frequently taking out more money than they put back into the economy," Sistrunk in January. "They do tend to cluster in areas and they will crowd out other businesses because of that ..." 


In other business Tuesday, aldermen held the first of two public hearings on a proposed amendment to the city''s sidewalk ordinance which would exempt four roads on the west side of town, just south of Highway 12, from sidewalk construction requirements.  


A handful of residents and transportation committee members spoke out against the exemptions to Miley Drive, Pollard Road and portions of Industrial Park and Airport roads, but the measure also had supporters, including Golden Triangle Planning and Development District Director Rudy Johnson, former judge Jim Mills and others. Ward 1 Ben Carver proposed the exemptions and said the city should take a "common sense" approach regarding sidewalk construction.  


"I''m for sidewalks in residential areas," Carver said. "I think there is a need in certain parts of town. I think a prioritized list of streets to consider (for exemptions) is a good idea. Systematic planning is a good thing." 


But, Carver, said, "There has to be a common sense approach to where we need them." 


The next public hearing is set to take place during the Board of Aldermen''s regularly scheduled meeting on Jan. 4 at 5:30 p.m. in City Hall.




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Reader Comments

Article Comment paydaylendingrep commented at 12/23/2010 12:02:00 PM:

Millions of customers across the country have used payday advance responsibly and appreciate having somewhere to turn when they need quick access to credit. While critics of the industry assign labels to payday lending customers, the fact is that these businesses provide service to a broad cross section of Americans because there is widespread demand for it. Denying consumers' access to payday loans leads to costlier credit options and greater financial burdens. People are best served when given a variety of options and trusted to make their own financial decisions based on what works best for them and their families.


Article Comment ckirby commented at 12/24/2010 8:55:00 AM:

"Denying consumers' access to payday loans leads to costlier credit options"

I don't care about any moratorium on legitimate business of any kind but I found that line to be misleading. Of all the owners and operators of such loan businesses I know, none charges less than 33%, most charge 40%, which is the current state maxmimum. At least that is what the owners tell me. If they charge the maximum allowed by state law, how can there be costlier credit options that are legal under state law?


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