Initiative to cap interest rates on payday loans features signatures for Michigan ballot – Ballotpedia News

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On June 1, the Michiganders for Fair Lending campaign submitted signatures for a ballot initiative that would appear on the November ballot.

The initiative would establish an annual interest cap of 36% for payday loans. Michiganders for Fair Lending argues that the typical payday loan has an annual rate of 370% and that high interest rates can be financially detrimental to Michiganders. According to the Center for Responsible Lending, 18 states, plus the District of Columbia, have an annual interest limit of 36%.

“Payday lenders have been using the lure of quick money to prey on vulnerable Michiganders for far too long,” said campaign spokesman Josh Hovey, “These extreme interest rate loans are designed to ensnare people in an endless cycle of debt, and we’re giving voters a chance this fall to fix this problem.”

Of the 10 initiative campaigns in Michigan, the Michiganders for Fair Lending campaign was the only one to meet the June 1 signature submission deadline.

The campaign claimed that of the 575,000 signatures they collected during the petition process, they submitted 405,265 signatures. In Michigan, 340,047 signatures are required in 2022 to qualify an indirect initiative state statute for the ballot. This number is determined by calculating 8% of the votes cast for governor in the last gubernatorial election.

The measure is an indirect initiative state law. Of the 21 states that allow state initiated statutes, nine states, including Michigan, use an indirect process for citizen initiated statutes. In Michigan, citizen-initiated statutes that receive enough valid signatures are sent to the Legislature, which then has 40 days to pass the initiative into law. The governor cannot veto indirect initiatives that legislators approve. If the legislature does not approve the initiative, then it appears on the next general election ballot.

The other nine initiative campaigns that did not submit signatures on time may appear on the ballot in the next election cycle.

Currently, there is another measure on the Michigan ballot: a constitutional amendment referred to by the legislature, which would change the term limits for state legislators.

Since 1996, 26 citizen-initiated measures have gone before Michigan voters for approval. Of the 26, 8 (31%) were approved and 18 (69%) were defeated.

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