HELENA (AP) — A district judge ruled Thursday that an initiative to cap interest rates on payday loans will stay on the November ballot after opponents failed to prove signatures had been improperly gathered.
The state certified the initiative, known as CI-164, after supporters turned in the signatures of 27,421 registered voters in 54 districts. The initiative seeks to cap the interest rate on payday loans at 36 percent.
Opponents contested the certification and sued to have the measure removed from the ballot, alleging signatures were improperly gathered because the petitions did not include the full text of the ballot measure; workers turned in false signature affidavits; and petitions were illegally notarized.
Bernard Harrington, the owner of EZ Money Check Cashing, said he and the other plaintiffs have not yet decided whether they will appeal the ruling by Judge C.B. McNeil, of Polson.
"I respect the judge, but I just wholeheartedly disagree with his decision," Harrington said.
Payday lenders currently are able to charge a fee up to a quarter of the amount of a two-week loan — the equivalent of 650 percent annual interest.
Supporters of the initiative say the loans prey on poor, vulnerable segments of the population and trap them in a cycle of deepening debt. Lenders counter that they are already regulated by the state, and the initiative would put them out of business if it passes.
Judge McNeil ruled there was nothing improper about the signature drive.
"The certification of CI-164 to the election administrators by the secretary of state shall remain in full force and effect," he ruled.
Helena attorney Jim Reynolds, who represents supporters of the measure, said the ruling protects the initiative process in Montana.
"Had the opposition prevailed in their claim, we think the initiative process would have sustained a body blow," Reynolds said.
Matt Leow, field director for 400 Percent is Too High — Cap the Rate, a political committee formed in support of the ballot measure, also said he was pleased the judge decided to let voters to decide the issue.