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West Valley City • Utah's second-largest city had, at last count, 46 payday lenders of one stripe or another. City officials don't want any more.
The City Council on Tuesday night unanimously approved some amendments to city ordinance tightening down some of the regulations applying to these "alternative financial service providers" and making sure the rules applying to check-cashing stores also cover car title loan companies and pawnbrokers.
Approval came after a public hearing in which no one spoke in opposition.
"The vast majority of the alternate-lending businesses in the city are supportive of theses measures because they've worked with us before and have the same general vision plan for the community," Council member Corey Rushton said.
"I think it's just good for the overall health of West Valley City business in general where we can say, 'hey, we want to have businesses and all types of businesses are welcome, but hey let's try to have a few common sense regulations and have some distance in between them,'" Rushton said.
The new ordinance gathers all regulations on this type of company in a single place in the city code and applies restrictions on title loan companies that already exist for the others. Among these are an overall cap of one such company per 10,000 population, a 500-foot buffer zone from residential neighborhoods, a 1,000-foot buffer from other similar businesses and a 500-foot separation from any regional shopping mall.
"This does not affect any existing business regardless of where they're located," said Mayor Ron Bigelow. "These restrictions do not affect them because all of them are grandfathered in."
West Valley was among the first cities in Utah to adopt regulations for payday lenders and the cap of one per 10,000 population has kept new ones from moving in (the population is estimated at 134,000.) But an issue paper presented to the council from city staff indicated that title loan companies "have essentially doubled" in recent years and "many are clustered along high-image corridors of the city."
All of these payday lending type businesses "have adverse secondary effects on surrounding neighborhoods," the issue paper said. "These businesses also negatively impact commercial areas, particularly where clustered."