Payday Lending Testimony

Yesterday I testified at the Texas House of Representatives Committee on Investments, Pensions and Financial Services about the need for payday lending reform in Texas. Below is a copy of my prepared remarks (my spoken testimony was a bit different):

Testimony of

Rev. Timothy B. Tutt

Pastor, United Christian Church

Austin, Texas

To the State of Texas House of Representatives

Committee on Invesments, Pensions, and Financial Services

Regarding Payday Lending legislation

Tuesday, March 22, 2011

Madame Chairman, Members of the Committee:

I am the pastor of United Christian Church here in Austin. Quite frankly one of the things that I do as the pastor of a church is worry. I worry about church members when their loved ones die or are sick. I worry about couples I counsel with when they are getting divorced. I worry about church members who are in the hospital facing huge bills.

And I worry about people when they lose their jobs.

You know, of course, that schools are facing huge budget cuts. We have several – maybe 25 or 30 – teachers in our congregation. So I’m worried about those teachers.

Three of our church members teach at Northwest Elementary School, in the Pflugerville School District. That school may lose four teachers dues to budget cuts. So there is a lot of stress and distress at that school.

Then in the middle of all of that worrying, these flyers showed up in the school mailboxes. Flyers from a local payday lending establishment were mailed to every teacher in that school offering them “fast cash.”

If you read the fine print, the flyer says, “The APR for a $360 Advance is 533%.” The print is tiny, but at least it’s there – but that is appalling: 533%. And the flyer was sent to elementary school teachers who are afraid they are going to lose their jobs or have their salaries cut.

Madame Chairwoman, Members of this Committee: That is wrong. This is one example of the payday lending industry preying on fears and offering quick fixes that simply sink people further into debt.

What this flyer promotes may currently be legal. And they may have even told the truth in the tiny little font at the bottom. But it is immoral.

As the pastor of a Christian congregation, I see that the scriptures of our faith tradition are clear. Exodus 22: 25 says, “If you lend money…to the poor among you, you shall not deal with them as a creditor; you shall not exact interest from them.” Jesus himself said, in Luke Chapter 6, “If you lend to those from whom you hope to receive, what credit is that to you? Even sinners lend to sinners, to receive as much again. But… do good, and lend, expecting nothing in return.”

Now, I don’t expect the payday lending industry to reconfigure their business practices to conform entirely to these biblical standards. And I understand that charging a reasonable amount of interest makes sense in their business climate.

But this example, and the current practices of the payday lending industry acting as CSOs, are not reasonable.

The current practices of the payday lending industry are immoral, out of control, and predatory.

I urge you to support legislation that closes the CSO loophole, sets fair and reasonable rates and fees, and stops the cycle of debt.

There’s a lot to worry about these days. Reforming payday lending practices gives us one less problem to worry about.

Thank you very much.

Fair Lending Press Conference

Earlier today, I joined thirty or so of my minister colleagues at the State Capitol to express our support for changing current payday lending laws in Texas. Right now, payday lenders operate through a loophole in Texas law that allows them to charge any rate of fees and interest that they want without any oversight or regulation by the state. Following are my remarks, explaining the theological basis of our efforts:

Remarks by Reverend Timothy B. Tutt Pastor, United Christian Church, Austin, Texas

Texas Faith for Fair Lending* Press Conference March 21, 2011

Tomorrow, the House Committee on Pensions, Investments, and Financial Services will hold hearings on current payday lending practices in Texas.

Today, we are gathered, as members of the clergy and representatives of various religious groups, to support reform of payday lending in Texas.

But these are not new topics. Issues of debt and economic fair treatment have concerned people of faith forever.

As the pastor of a Christian congregation, I can say the scriptures of our faith tradition are clear:

• Exodus 22: 25 says, “If you lend money…to the poor among you, you shall not deal with them as a creditor; you shall not exact interest from them.”
• Jesus himself said, in Luke Chapter 6, “If you lend to those from whom you hope to receive, what credit is that to you? Even sinners lend to sinners, to receive as much again. But…do good, and lend, expecting nothing in return.”

The Bible is very clear that those with money are supposed to be compassionate and fair to those without money:

• “It is well with the [the person] who deals generously and lends; it is well with the one whose affairs are conducted with justice.” – Psalm 112:5
• “Whoever is generous to the poor lends to the Lord, and God will repay [that person] for [those] deeds.”- Proverbs 19:17

Now, I don’t expect the payday lending industry to reconfigure their entire business model to conform entirely to these biblical mandates. I don’t expect them to give up charging interest. I understand that charging a reasonable amount of interest makes sense in their business context.

But the current practices of the payday lending industry are not reasonable.

The current practices are immoral, out of control, and predatory. Charging 500% interest violates any sense of decency and compassion and basic fairness.

This is not a matter of left or right, Democrat or Republican. The people here today represent religious congregations across the theological and political spectrum.

This is not just a Christian issue or a Jewish issues. The sacred writings of Islam, Buddhism, and Hinduism are equally expressive.

We are not here today just to support good public policy.

We are not here today just to take part in the legislative process.

We are here today with the firm theological conviction that 500% interest is wrong. Charging people astronomical rates and fees is wrong. Trapping people in cycles of debt is wrong.

We are here today to speak a word of justice, to call for kindness, to remind ourselves and our elected officials that God cares how treat each other. God cares especially how we treat the poor and needy among us…and we should care as well.

Thank you.

* Texas Faith for Fair Lending is a statewide coalition of religious groups, working to reform predatory lending in Texas.

Testimony in Support of Anti-Bullying Legislation

Yesterday, I testified at the State Capitol in support of anti-bulling legislation. Below is a copy of my testimony:

Testimony to the Texas House of Representatives Public Education Committee

Rev. Timothy Tutt, Pastor, United Christian Church, Austin, Texas

March 1, 2011

In Support of H.B. 224

Mr. Chairman and Members of the Committee:

Thank you for holding a hearing on this important piece of legislation.

I am the father of two elementary school children and the pastor of United Christian Church here in Austin. I support this bill.

Two weeks ago, I received a phone call at our church office from a man who needed someone to talk to. For the sake of his confidentiality, let’s call him Bobby. Bobby told me he was a gay man. He said he had known he was gay since he was very young. He called me because he had some theological questions. Bobby told me the church he attended had told him he was a no-good sinner, that God hated him, and he was going to burn in hell. (We can save the theology of all of that for later.) But in the course of talking with him about these issues, he also told me that when he was young he was sexually abused by a family member. And he told me that all of his growing up years, he was taunted, harassed, belittled, and bullied by other students at school.

You know, Mr. Chairman and committee members, from reading the papers, and just from common sense, that this kind of experience is all too common.

What struck me as so sad in my phone call with Bobby was that he did not feel safe anywhere. He didn’t feel safe at his house of worship, at his home, or at school.

This bill, HB 224, that Mr. Strama has put forward, helps address part of the problem.

My wife works in the Pflugerville Schools, so I am glad to see this bill provides common sense ways to help teachers to identify and prevent bullying.

I am the parent of two elementary school aged kids, so I’m glad to see that this bill addresses text messages, cell phones, and other 21^st century high-tech forms of bullying.

And, I think the reporting requirements in this bill are very important. When I get calls like the one I got from Bobby two weeks ago, or when I talk to people in my church office, I hear that people who have been harassed or abused or bullied often feel all alone in the world. Having the statistics available would help victims know that they are not alone in their circumstances. And the reports would help us, as citizens of Texas, actually see the problem so that we can better address it together in our homes, our places of worship, and our schools.

As I said, my wife works in a public school, and we have two elementary school aged children. Providing a safe learning environment is important for education. Addressing bullying is important for human dignity.

We can’t go back and undo the damage done to Bobby, the man who called me a couple of weeks ago. Our church can work to provide a safe place for him now. And by passing this legislation we can do our part to help today’s school children.

Thank you.