UNDATED (WSAU) Governor Jim Doyle used his partial veto power yesterday to ban auto title loans in Wisconsin. The governor did it by cutting out words and sections of the bill that regulates pay-day loans for the first time. Both actions take effect December first.
Doyle said auto title loans are “some of the worst predatory lending practices,” because those who can’t pay them back lose their vehicles and maybe the ability to keep their jobs. The Assembly had voted to ban auto title loans, but it ended up allowing them in a compromise with the Senate. Doyle also used partial vetoes to ban new interest charges after a pay-day loan becomes due. But he did not insert an annual limit on interest rates after the Legislature had refused to do so. Doyle approved other parts of the bill.
Pay-day loans can only be rolled over once – each loan will be limited to 15-hundred dollars – and new a new loan store cannot locate within 15-hundred-feet of another. Andy Gehl of the Legal Aid Society said Doyle closed a number of loopholes.
The chief sponsor of the bill, Assembly Democrat Gordon Hintz of Oshkosh, praised Doyle’s changes and said the industry’s most abusive practices would end. But Madison attorney Fred Wade – a critic of the governor’s veto powers – called Doyle’s action an “outrageous abuse.” He said the governor wiped out an entire industry without the Legislature’s consent – and it should be a wake-up call for any business that’s regulated by the state. Leaders in both houses say they will not try to override the partial vetoes.
