Nebraska Payday Lender Interest Rate Cap Initiative qualifies for the November ballot

On July 31, 2020, the Nebraska Secretary of State completed the signature verification process for the Payday Lender Interest Rate Cap and announced on August 5 that it had qualified for the ballot.

The initiative would limit the annual interest charged for delayed deposit services—also known as payday lending—to 36%. Sixteen other states and the District of Columbia have also enacted a 36% rate cap for payday lending. Colorado was the most recent state to approve a 36% limit through a statewide ballot initiative, Proposition 111, in 2018.

Election officials verified 94,468 valid signatures for the Nebraska initiative, 110% of the number required. Nebraskans for Responsible Lending, the committee leading the campaign in support of the initiative, submitted over 120,000 signatures. The estimated signature validity rate for the petition was 78.7%.

Nebraskans for Responsible Lending reported receiving $1.76 million in cash and in-kind contributions. The Sixteen Thirty Fund has contributed the most to the campaign with contributions totaling over $840,000. The Sixteen Thirty Fund was also the largest contributor to the campaign that sponsored Colorado Proposition 111 with over $2 million in contributions. Nebraskans for Responsible Lending had also received contributions from the ACLU, The Fairness Project, Nebraska Appleseed Center for Law in the Public, and Fraser Stryker law firm.

In the campaign’s press release announcing the certification, Aubrey Mancuso, a spokesperson for Nebraskans for Responsible Lending, said, “The fact that signatures were verified in 46 counties speaks to broad support for this initiative. Predatory payday lenders have been charging excessive interest to Nebraskans who can least afford it for years, trapping them in long-term debt that is financially devastating. We found overwhelming support from Nebraskans when circulating this petition, and we are very pleased it’s official. We can now move forward with ending these unethical lending practices.”

There is no organized opposition to the initiative so far, but the ballot language of the initiative has been challenged in court. On July 27, 2020, Trina Thomas, the owner of Paycheck Advance, filed a lawsuit in Lancaster County District Court against the ballot language drafted by Nebraska Attorney General Doug Peterson (R). She argued that the term “payday lenders” was not in the statute that the initiative would amend and was “deceptive to the voters as it unfairly casts the measure in a light that would prejudice the vote in favor of the initiative.” In the press release by the state announcing the certification, it acknowledges the lawsuit and says the attorney general will be defending the ballot language in court and the case outcome will be determined soon.

Four other initiative campaigns in Nebraska submitted signatures by the July 3 deadline. Three initiatives concern gambling at licensed horse racetracks, and the other initiative would legalize medical marijuana.

In Nebraska, the number of signatures required to qualify an initiated state statute for the ballot is equal to 7% of registered voters as of the deadline for filing signatures, which was 85,628 signatures. The requirement is 10% for initiated constitutional amendments or 122,326 signatures.

Between 1996 and 2018, Nebraska voters approved 53% (39 of 73) and rejected 47% (34 of 73) of ballot measures. An average of six measures appeared on statewide general election ballots during that period.

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