By Bill Britt
Alabama Political Reporter
The sponsor of a Payday Lending Reform Bill was shocked to watch as those reformers he was trying to help sabotaged the Legislation. For the past several Legislative Sessions, State Rep. Danny Garrett (R-Trussville) has worked to bring about, what he considered, meaningful reform to Payday Lending. Garrett joined with the Southern Poverty Law Center, Alabama Arise, and others to push further lending reform. But, rather than accept the compromise bill that Garrett worked so diligently to pass, the SPLC and Alabama Arise backed a filibuster in the Senate and doomed all of his efforts.
“I don’t understand that type of thinking,” said Garrett in an interview with The Alabama Political Reporter. “To kill a bill because you can’t have everything you want doesn’t make sense, because we, as Legislators, have to work in the real world of what’s possible.”
Garrett, who is a member of the 2014 Class, has risen rapidly in leadership due to his business background and willingness to work hard on the issues. As a CPA, Garrett has extensive corporate experience. He became interested in Payday Lending even though his District isn’t home to Payday Lenders. He felt there were problems within the system that needed to be addressed. “The first year I sponsored a bill that capped the interest rate at 36 percent, but as I got into it I found there were a lot of differences of opinion about the whole deal to the point that after a couple of years, I asked what can we really do to bring about reform?” Garrett said he didn’t want to destroy the industry in the State or put people out of business, but looked to find ways of ensuring borrowers who were being treated fairly.
“My heart was with the reform advocates,” said Garrett. “And I wanted a bill that would make the industry less predatory.” Garrett said in 2016, he was able to craft a reform bill that had the support of the State Banking Commission, but another more restrictive piece of legislation was favored by the SPLC, Alabama Arise, and other reform advocates.
Garrett explained that in 2016, the Obama Administration was moving toward restricting all Payday Lending to a 36 percent cap under the Fair Credit Reporting Act, (FCRA), however, that all changed with the election of President Donald Trump. “Under Obama, the reform-minded people had leverage, but that had passed,” said Garrett.
“Here’s what I knew,” said Garrett, “I knew what our hurdles were, our options were, and what the break points were and we needed a compromise to get some kind of reform.”
But Garrett said he was opposed by those who had been his allies because they wanted more than what was possible to pass. Garrett explained that, a bill the SPLC and Arise would have jumped at in 2016, was no longer something they would support. “I said, Guys, that doesn’t make any sense. We’ve got a bill that can pass. You can’t have everything you want. There has to be some compromise.”
Garrett’s bill had support from the House and Senate leadership, had passed the House and Senate committees, but died in a Senate filibuster because the reform advocates wanted more than was available. The all or nothing approach Garrett admits may doom any future reforms.
Garrett says he is not so cynical as to believe that advocacy groups carry legislation into the “Red Zone” simply to let it die so as to obtain more contributions for their cause. But he does see how an unwillingness to face the realities of Legislative compromise often have the same results.
Garrett says he still believes there are smart reforms, but wonders if there is a will to move forward after what happened this Legislative Session.