County Council members put a freeze on the proliferation of payday-loan stores Tuesday, voting unanimously to keep the businesses from multiplying within the county's unincorporated boundaries until early next year.

By then, officials hope to have a more permanent policy to regulate the industry.

"I don't have any problem saying, 'Let's take a rest here,' " said GOP Councilman David Wilde, describing the six-month moratorium as a "rational way to go" to decide whether stricter regulations are warranted for payday-loan stores.

Councilman Joe Hatch has lobbied for limits on the check-cashing industry for 18 months, pushing for density restrictions that would keep stores from sprouting too close to one another.

The Democrat didn't get his way. Instead, the County Council overwhelmingly backed a six-month moratorium - to which Hatch smiled and called it a "wonderful delay."

The moratorium comes as a political compromise between those who would cap the number of check-cashing businesses and those - such as Republicans Mark Crockett and Jeff Allen - who fear any restrictions on the free market will make matters worse.

"The last thing we want to do for a usurious business is to provide local monopolies," Crockett said. "That compounds the problem."

Crockett hopes the temporary ban will buy enough time to lobby the Legislature for fee limits, disclosure requirements or other statewide regulations on the payday industry - where annual interest rates can top 500 percent.

Yet Salt Lake County isn't the only one contemplating a cap on check-cashing businesses. Salt Lake City has considered tightening its ordinances, and West Valley City, South Salt Lake, Taylorsville, West Jordan, South Jordan, Draper, Sandy and Midvale already have imposed density restrictions.

The trend worries Tom Despain, director of stores for USA Cash Services. While his store has benefited from density limits in some areas, he said a cap on competition will do nothing but harm.

"I believe in competition," he said. "That is the American system. Competition drives down prices and improves services."

By shutting out new check-cashing stores - as the County Council did Tuesday - he said government unwittingly protects questionable payday businesses that couldn't have survived in a competitive market.

The county now has 17 checking-cashing business within its unincorporated areas. Hatch urged a moratorium before any more can arrive.

"The opening of these shops is going at such and exorbitant rate that I think even a week would be a problem," he said.

County officials could not immediately provide data on how many payday-loan stores had moved in since Hatch introduced his proposal last year. However, the Democratic councilman said the cap he proposed on check-cashing businesses - which he claims allowed for growth - already has been surpassed.

The Utah Consumer Lending Association has characterized the council's action as "bad for Utah consumers."

Despain agrees. "They are making a mountain out of a molehill."

jstettler@sltrib.com