Salt Lake County wants the state to put a pinch on the sky-high interest rates of payday lenders.
Utah's most-populous county will urge the Legislature next year to rein in a check-cashing industry whose annual interest rates can top 400 percent.
The Salt Lake County Council passed a resolution 5-1 on Tuesday calling on lawmakers to limit those interest rates to 100 percent annually.
"We are trying to send a message to the Legislature," said Councilman Joe Hatch, who championed a zoning change last year that restricts the proliferation of check-cashing stores. "Please be proactive in this."
Payday lenders argued against the resolution, insisting state law already precludes the industry from collecting those higher rates. Borrowers are allowed to accumulate interest for only 12 weeks, according to Wendy Gibson, spokeswoman for the Utah Consumer Lending Association, making the return closer to 100 percent on a single loan.
Further restrictions on the industry, Gibson argued, could cost consumers and put some stores out of business.
"The alternatives to payday lending are much more expensive," she said, noting overdraft fees and the cost of reconnecting utilities that have been turned off. "The product we offer is a viable option for tens of thousands of your constituents."
Councilman David Wilde cast the lone no vote against the resolution, saying the council does not have enough information to say that the 100 percent rate, included in the council's resolution, is the right number.
