Payday loan amendment threatens to gridlock Colorado legislature
Just hours before the Colorado legislature is due to shut down for the season, an amendment is causing frustration. The annual rules bill that deals with much of the day-to-day operations of the state has a new, controversial amendment about payday loans. If the issue is not resolved today, the Colorado legislature will require a special session.
Colorado Senate Bill 78
Colorado Senate Bill 78 is an annual rules bill that was intended to create specific, enforceable rules for many of the bills passed over the last session. There are about 600 individual rules addressed in Senate Bill 78, including solid waste disposal fees, fire codes in schools, licensing of medical marijuana dispensaries and ski lift safety. After the bill had been passed by the House, Senate Republicans amended the bill to include a previously dead bill that changes payday lending laws in the state.
Proposed changes to Colorado payday lending law
Last year, the Colorado legislature made significant changes to payday lending laws in the state. The fees and interest rates that lenders could charge were severely limited. The bill also limited origination fees on any short-term loan to $75. Lenders argued that the way the rules on this particular law were written was improper, and the Colorado House earlier this year passed legislation that allows lenders to keep their regular origination fees. The bill died in the Colorado Senate, however. Senate Republicans tacked the bill back onto the Rules Bill as an amendment, re-igniting debate on the controversial issue.
Potential cost to taxpayers
If the House and Senate in Colorado cannot come to an agreement on Colorado Senate Bill 78, the legislature may well face a special session. A special session of the legislature could cost taxpayers several thousand dollars per day. In Washington, special sessions were estimated to cost $20,000 per day; New York special sessions are about $50,000 per day. In short, the cost of sorting out the payday loan bill in Colorado could cost taxpayers several hundred thousand dollars.