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Interest rate limits in the United States are one of the oldest forms of consumer protection. These limits are called usury laws, and they’ve existed for centuries. At the time of the American Revolution, every state in the Union had interest rate limits. 

That’s according to Lauren Saunders, Associate Director of the National Consumer Law Center, a nonprofit organization that advocates for consumer reform.

 “But in the last few decades, banks have managed to escape interest rate limits,” Saunders says. “Banks generally can charge whatever they want, and they can ignore state law. So, predatory lenders have been trying to find a way to use banks to get around interest rate limits so they can charge high, astronomical rates that states don’t allow. We call this ‘rent-a-bank’ lending.” 

“Rent-a-bank” schemes work like this: A payday lender will place a bank’s name on a loan. Because national banks have no limit on charging interest rates under the National Bank Act of 1864, that loan can have an interest rate higher than the state cap.  The bank, which holds the loan, will then sell it back to the payday lender.

That means payday lenders can use banks as cover for charging exorbitant interest rates. And payday lenders can charge Interest rates that exceed what’s allowed by each state. 

Since the 1800s, the Supreme Court has held that contracts concerning the interest rate on a loan won’t be upheld if they were formed with the intent to evade usury laws. 

But, last September, two federal regulatory agencies argued in a Colorado federal court district that non-bank lenders, including payday lenders, may charge the same interest rate banks offer. 

Those two regulatory agencies are the U.S. Treasury’s Office of the Comptroller of the Currency, or OCC, which regulates and supervises banks, and the Federal Deposit Insurance Corporation, FDIC, which regulates and insures credit unions.

Here’s Saunders again. 

“The OCC and the FDIC have sided with this predatory lender, World Business Lenders, in a court case, and then they shortly afterwards issued this proposed rule that would codify the ability of lenders that should be limited by state interest rate limits to charge whatever banks can charge,” Saunders says.

Romulus Johnson is a counsel with the FDIC’s Legal Division. He says the new rule-making isn’t intended to prevent states from setting their own interest caps, but rather to make sure banks can sell their loans to maintain the liquidity of their assets. 

“The sole purpose of that proposed rule-making was merely to reiterate that, in the FDIC’s view, community banks continue to enjoy the same right of interest rate exportation and assignment of their loans that national banks enjoy under the National Bank Act,” Romulus says. 

Martin Gruenberg is a member of the FDIC’s Board of Directors. He voted against the rule-making proposal in November. 

“It is essential that the FDIC not unnecessarily undermine the application of state consumer protection laws to rent-a-charter relationships. This proposed rule could well have that effect,” Gruenberg argues. 

Yesterday, Wisconsin Attorney General Josh Kaul joined a bipartisan coalition of eighteen state attorneys general opposing the proposal to exempt payday lenders from state interest caps. 

Wisconsin does not have a usury law that caps interest rates. But in a press release yesterday, Attorney General Kaul argued the importance of letting states impose and enforce interest rate caps in the future. 

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Last year, Governor Tony Evers reinstated the pardon review board and issued the first pardons in Wisconsin in nearly a decade, but he also noted during last night’s State of the State that his administration has a lot of work left to do with criminal justice reform.

Part of that work may be achieved through a package of bills that were introduced earlier this year. WORT producer Shaun Soman spoke with UW-Madison Professor of Law Cecelia Klingele about those bills earlier today.

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Governor Tony Evers took to the podium last night to deliver a speech that touched on the many issues he worked to address during a first term that was marked by repeated spats with a Republican-controlled legislature. 

Despite threats to veto an entire budget and the dismissal of a cabinet appointee,  Evers still took the time to highlight areas of bipartisan progress.

“In my last State of the State Address, I asked the legislature to set politics aside so we could work together on the issues facing our state,” said Evers. “I said I expected bills to be passed with broad support and in the spirit of bipartisanship. So, one of the things I’m most proud of is that more than 95 percent of the bills I signed my first year in office had bipartisan support. And, by golly, folks worked together on some important issues.”

Evers highlighted healthcare, voting rights, and human trafficking as issues where he and the legislature made progress in 2019. He promised to spend 2020 focusing on investing in communities, youth vaping issues, insulin prices, and water contamination. 

Evers also made agriculture, rural investment, and the lagging dairy industry in Wisconsin  central priorities, in response to a steady stream of farm bankruptcies and dairy instability in the state. The Milwaukee Journal Sentinel found that over 800 Wisconsin dairy farmers either left or were forced to quit the industry last year. When the U.S. Secretary of Agriculture, Sonny Perdue, visited Wisconsin last October he said that small farms may have to consolidate to survive.

“They saw when milk prices are low, you need to milk more cows to make up for it,” said Perdue. “When milk prices are high, you need to milk more cows to take advantage of it.”

Evers dismissed that perspective, then ordered the legislature to get to work on the issue through a three-pronged plan. Step one of the plan gets underway next week. 

“We’ve heard people who’ve said there’s no place for small farms anymore,” said Evers. “They ought to go big or bust. Well, they’re wrong. Tonight, I am calling a special session of the legislature next week to take up legislation to invest in our farmers, agricultural industries, and our rural communities.”

Evers said that he would also expand the Farm Center, increase staffing at UW Extension, and create new programs that would get food and mental health services to farmers. Senate Majority Leader Scott Fitzgerald told Channel3000 that he’s willing to hear out Governor Evers’ agricultural proposals. 

But the Majority Leader denounced Governor Evers’ push for a nonpartisan redistricting committee to draw fair maps. Evers said that the lack of competitive districts is one of the major reasons that some of his policies, which poll well, are not enacted.

“When more than 80 percent of our state supports medical marijuana, and 80 percent support universal background checks and extreme risk protection orders, 70 percent support expanding medicaid, and elected officials can ignore those numbers without consequence, folks,” said Evers. “Something is wrong.”

Fitzgerald called the proposal “unconstitutional.”

Wisconsin is one of the most gerrymandered states in the union, with very few competitive seats for non-statewide elections. A Marquette poll from last January found that seventy-two percent of Wisconsinites want legislative districts to be drawn by a nonpartisan commission. 

But Republicans have consistently opposed redistricting reform and have defended the current maps as fair. Last year, Assembly Speaker Robin Vos said that Republican dominance in the legislature was simply because of better candidates and better messaging.

In his response to Evers’ speech, Senate President Roger Roth, a Republican from Appleton, said that Evers was focusing too much on appealing to liberals.

“Recently governor Evers was asked to grade his first year in office,” said Roth. “He gave himself a grade of incomplete. I appreciate his honesty. Listening to Madison elites while ignoring the rest of Wisconsin isn’t a recipe for success.”

Evers’ approval rating is at 48%, according to a Morning Consult Poll from the end of last year. 36% of respondents disapprove of him. He’s popular among Democrats, unpopular among Republicans, and more independents like him than dislike him.

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Nicki Vander Meulen currently holds Seat 7 on the Madison Metropolitan School District’s Board of Education.

Vander Meulen is a juvenile attorney, has been a disability-rights advocate since a young age, and was elected to Seat 7 in 2017, becoming the first school board member who is openly on the autism spectrum — not just in Madison, but in the entire United States.

WORT producer Shaun Soman spoke with Vander Meulen about her candidacy in the coming April 7th election earlier today.

The post Nicki Vander Meulen, Disability Rights, & the Run for Madison Sch... appeared first on WORT-FM 89.9.

During its full meeting last night, the City of Madison’s common council advanced an ordinance that would impose stricter regulations on short-term tourist rentals like Airbnb operations. 

The city currently requires that short-term rentals must also be the operator’s primary residence, and prohibits them from renting the house when they are absent for more than a month each year. 

Alder Arvina Martin represents part of Madison’s west side. She says the regulations are meant to address concerns that arise when those who run short-term rentals aren’t present, and to prevent them from purchasing homes with the sole purpose of renting them out to tourists.

“[In one case] it led to a lot of problems between the homeowner and the neighbors,” Martin says. “[There was a lot] of concern about the volume of folks renting out the particular property, in terms of how many dates it was occupied but also how many people were staying at one time, which was leading to traffic concerns in a neighborhood that is very residential and has lots of small children.” 

Matt Tucker is the Zoning Administrator for the City of Madison. 

He says that when the City’s initial ordinance regarding short-term rentals was passed in 2013, property owners had to work separately with zoning, Public Health Madison and Dane County, and the Treasurer’s Office to make sure the building was compliant. 

Tucker says that those overlapping requirements made compliance difficult for those renting out their homes.

“We found that even the property owners themselves struggle with compliance on this, and that is why there was renewed interest to revisit the requirements to make a more formal process by which one would work through the city building inspection office to obtain a permit for a tourist rooming house operation in the dwelling unit they occupy,” Tucker says.

Under the proposed ordinance, those who want to run a short-term rental unit would have to provide the zoning administrator with information about ownership and property, proof of license from Public Health, registration with the Treasurer’s Office, floor plans, contact information, a guest registry, and an affidavit confirming the house is their primary residence. 

The ordinance would also establish a $100 annual permit through the City that Alder Martin says would fund costs of enforcing compliance. 

“We are not looking to price anybody out,”  Martin says. “We are looking to make sure we can cover the cost of enforcement of these situations. This is not something that the City is looking to make money off of, we just want to be able to properly enforce the ordinances that we have.”

Currently, a new license through Public Health Madison & Dane County costs $561 dollars, and an annual renewal amounts to $186. Those fees fund Public Health’s licensing program. 

Doug Voegeli is the director of Public Health’s Environmental Health Division. 

He says the additional regulations could cause Madison’s short-term rental market to shrink. 

“Perhaps it’s not profitable for them. Perhaps it’s just too much to go through, too many affidavits or licenses or certificates needed to actually become an operator,” Voegeli says. “Those that are currently operators I could see dropping out just because it gets to be too much.” 

The Wisconsin State Journal reports that in 2017, “only 15 to 20 of hundreds of Airbnb and other operators” complied with city requirements. At the moment, Voegeli says 244 operators out of an estimated 382 in the Madison area are compliant. 

The proposed ordinance now goes before the plan commission next Monday and the board of public health in two weeks.

From there, the ordinance will go back to the plan commission on February 10th, and then to the full council at the end of next Month.

The post Madison Considers Stricter Tourist Rental Laws appeared first on WORT-FM 89.9.

Max Prestigiacomo is running for the District 8 seat on Madison’s city council. Prestigiacomo was previously the executive director of the Youth Climate Action Team, and was the Wisconsin State Lead for the March 15th Climate Strike last year. Currently, Prestigiacomo is a freshman studying political science and history at UW-Madison.

WORT producer Shaun Soman spoke with Prestigiacomo earlier today.

Image Credit: Aidan Dressang

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Today, Wisconsin lawmakers moved to advance a bill to curb water contamination.

The bill, which now heads to the State Senate, would prevent firefighters from using foam that contains PFAS, a family of toxic chemicals. The bill would allow the use of toxic foam in emergencies and in cases when fire departments have a plan to deal with the foam.

PFAS, or so-called “forever chemicals,” don’t break down easily in the environment.  

Last March, the City of Madison closed a well on Madison’s east side due to concerns over high levels of PFAS. The nearby Dane County Regional Airport has been a source of contamination through firefighting foam and burn pits.

Jeffrey Lafferty, a spokesperson for Public Health Madison Dane County, says that PFAS levels in Madison remain safe. But he says but caution is warranted.

“It depends on your exposure,” says Lafferty. “And on very high levels of exposure, there have been impacts to the immune system, increasing cholesterol levels, and it lowers the chance of a person getting pregnant.”

Lafferty says that one of the primary ways people come into contact with PFAS is through eating fish contaminated with the chemicals. 

And last week, the state issued an advisory for eating fish from Starkweather Creek and Lake Monona.

Regulating PFAS has been a legislative priority since last year, when officials found relatively high levels of PFAS contamination in the northeastern county of Marinette County.  Representative John Nygren, a Republican from the city of Marinette, introduced the water contamination bill in response to contamination in his home district. The bill specifically targeted PFAS in firefighting foam.

“There is little doubt their use in emergencies has saved both lives and property,” says Nygren. “When mixed with water, these foams have low surface tension and spreads easily which makes them highly effective against flammable liquid fires. Oftentimes testing or training took place without proper precautions or containment measures in place. This has led to PFAS environmental contamination surrounding airports. For decades, a major business in my district manufactured this foam and has tested it in an outdoor training field.”

After the Madison Gas and Electric fire last year, Madison residents raised concerns that the PFAS in the firefighting foam may have contaminated the drinking water. Lafferty says that they saw no significant changes afterward. But the Madison Fire Department announced their foam was going PFAS-free last month. Cynthia Schuster is the spokesperson for the department. 

“In mid-December we took two days to have every rig in the city come on over to have their foam swapped out and properly disposed of and their tanks properly cleaned so that none of the old stuff would carry over into the new mixture,” said Schuster. “And then that was disposed of my a company we contracted with. Effective mid-December, after those two days, every fire truck in the city had switched over to our PFAS-free foam.”

Madison Mayor Satya Rhodes-Conway also told NBC earlier this week that the city was working to educate people on PFAS and how to avoid it.

The bipartisan bill received some opposition from Democrats, who criticized it as not going far enough. Representative Chris Taylor of Madison, whose district contains the Dane County Airport and Truax Air Base and the contaminated well 15, called for broader regulation of PFAS. 

“My point is that we can’t just take this step,” said Taylor. “We have to keep moving forward. We welcome collaboration with you all, because I know that this issue is impacting a lot of our districts. We don’t even know yet all of the places it’s coming from, much less have a plan to filter that water out or somehow clean it before it enters our waterways.”

Representative Taylor introduced an amendment to the bill that would have required the Wisconsin DNR to set and enforce PFAS standards. The amendment did not pass.

The bill now heads to the senate. Senate Majority Leader Scott Fitzgerald did not respond to a request for comment by time of broadcast.

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When a business like Canopy seeks an alcohol license in the Marquette Neighborhood, the owners usually meet with the Marquette Neighborhood Association’s Preservation and Development Committee first. 

The matter then goes to the full MNA board before the ALRC makes its final decision. 

Yesterday, the Board voted to send a letter to the ALRC asking them to follow this procedure instead of granting Canopy an alcohol license. 

Jack Kear is the Chair of the MNA’s Preservation and Development Committee. He says that the full board was surprised by how quickly the application has moved.

“The very first time that it came before the neighborhood association affiliation officially was last night,” Kear says. “So, the proposal to open the bar this Saturday, will make it the first alcohol establishment in our district to open before the neighborhood association has even had a chance to hear about it.” 

Kear also says that, given community concerns, the Preservation and Development committee voted to recommend the ALRC deny Canopy an alcohol license. 

Steve Ohlson lives about 300 feet from 924 Williamson, the former site of Plan B and Prism, dance clubs that ostensibly catered to the LGBTQ+ community before closing.  

Ohlson says he’s open to Canopy opening as a nightclub in the Marquette Neighborhood…just not at the Willy Street location. 

“For me and my wife, the thing we experienced most noticeably was that every night at bar time, there was a crowd of screaming, laughing people that poured down the street and woke us up in the middle of the night,” Ohlson says. “I don’t have any objection to a music club. That’s a great idea, but it has to be in a location that’s appropriate.

Austin Carl is Canopy’s owner. He says even though the website’s URL uses the term “nightclub,” he thinks the venue will aim to be something more.

If Canopy does incorporate music, its lease prohibits it from having special “hip hop and urban music” events. 

“The landlord was worried that we would have some instances that would scare away some of the community members. Not [so much as] scare away, necessarily, as make the community uncomfortable,” Carl says.  

Beyond concerns of noise, certain members of the LGBTQ+ community have been outspoken about Carl’s claim in The Cap Times that Canopy will be “demographicless.” 

nibiiwakamigkwe is a two-spirit individual who attended 18 and up events at Plan B as an undergraduate student at UW-Madison. They say they’d like to see Canopy have gender neutral bathrooms to better support the LGBTQ+ community.

During last night’s meeting, the Alcohol License Review Committee referred their decision to next month’s meeting, allowing the full Marquette Neighborhood Board to meet about Canopy this Monday. 

Canopy is still set to open this Saturday, January 18th, but only as a café.

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The Palmyra-Eagle school district is located an hour east of Madison, and consists primarily of two towns separated by the Kettle-Moraine Forest: Palmyra and Eagle.

Last April, voters in the district rejected a proposal to raise $11.5 million in taxes over four years to sustain the district, which has seen enrollment steadily decline over the last decade. Last November, with fewer than 800 students still enrolled in the district, voters called to dissolve the district entirely.

However, school districts in Wisconsin can’t decide to close by themselves. Mike Bormett, an Assistance Director of School Management Services for Wisconsin’s Department of Public Instruction, says that decision is up to a panel of the state’s DPI, called the School District Boundary Appeal Board. 

“State law requires that the School District Boundary Appeal Board be assembled and called in to review that order of dissolution and to affirm or deny that order,” says Bormett. “Wisconsin school districts cannot unilaterally decide to dissolve.”

Bormett says that, had the appeal board affirmed the dissolution, the district would have been the first Wisconsin school district to dissolve in thirty years.

It also would have meant about 770 students would need to find another school. 

In the November 2019 referendum to dissolve the Palmyra-Eagle School District, voters were split between towns. Voters in Palmyra were in favor of keeping the school district, but voters in Eagle favored dissolution.

According to the US Census records from 2017, the median household income in Palmyra was around $47,000. The median household in Eagle was around $95,000.

Carrie Ollis, the former clerk for the school board, told the Milwaukee Journal Sentinel that people who supported the dissolution had called her “a thief, a criminal, a member of the mob.” She says she’s  been accused of using money for the school district to take a personal vacation.

Tara Bollmann, former vice president of the board who voted to dissolve, told the Milwaukee Journal Sentinel that while children in the district are getting along, parents continue to argue.

She says that she has watched the two halves of the district fight since she was a child, and called her dissolution vote the best thing for the district.

There are currently eight candidates vying for the three newly vacant board seats in the spring election. Scott Hoff, the former school board president , told the Journal Sentinel that a community member offered donate up to $100,000 if the current school board stepped down. 

He said he stepped down because the district needed the money “far more” than they needed him.

According to an analysis from the Wisconsin Policy Forum, the school district has lost 383 students over the last decade.

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