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Clay places moratorium on payday licenses

By Lee Weyhrich

The Clay City Council on Monday declared a moratorium on check cashing, payday advance and title loan business licenses.

The order would not affect the one check cashing establishment already in the city limits, but it would keep new business licenses for this type of  business from being issued.

Local businessman Ron Self disagrees with the moratorium. According to Self, these businesses would bring revenue into the cash-strapped city. 

“We need to bring (businesses) in, rather than keep them out,” Self said, adding that two renters of his properties were cash advance businesses, and neither had ever had any problems.

Councilwoman Becky Johnson likened the debate over cash stores to an earlier moratorium on pawn shops. The residents of Clay came out in numbers to speak against any new pawn stores from doing business in city limits. Johnson believes the argument is the same for any business of this nature.

Pawn shops and other loan-based businesses are considered “adult” stores, according to current laws and are often lumped in with other adult-themed businesses for zoning and business purposes, City Manager Ronnie Dixon said.

“Center Point is trying to get rid of those businesses because they’ve seen it increase their crime,” Councilman Kevin Small said. “(If we allowed this) it’s going to open Pandora’s box. If we’re going to open Pandora’s box we might as well do it all the way; pawnshops, adult theaters, adult bookstores, whatever.”

The resolution states the city is opposed to any business that can be seen as detrimental to the health, safety or welfare of residents. It further states payday advance businesses and their ilk “charge high fees that entangle borrowers in a vicious cycle.” The resolution also cites a 2011 study from American Society of Criminology that claims a correlation between payday lenders, violent crime and lowered property values.

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