By Ash Kalra
The San Jose Inside April 27 article “Manny Diaz Shilling for Loan Sharks” seems to imply that the lobbying efforts of Mr. Diaz have resulted in a decision by the City to delay accepting Silicon Valley Community Foundation’s grant to study the impact and breadth of the payday loan industry in San Jose. This is simply not the case.
Back in December of 2010, I co-authored a memorandum with Councilmember Xavier Campos directing the City to apply for the grant. The memorandum was approved, the City applied for the grant, and Silicon Valley Community Foundation’s informed us that the City had been awarded the grant.
The grant requires that the City provide a detailed timeline of how it will study the feasibility of an ordinance limiting payday lending in San Jose. As most everyone in San Jose is aware, the City is struggling with a staggering deficit and is in the midst of a difficult budget balancing process. Cuts are going to be made in most, if not all of the City’s departments. As a result, it is difficult to accurately project a timeline when, at the moment, it is unclear how much manpower the City will have following the implementation of the 2011-2012 budget. These circumstances have been communicated to Silicon Valley Community Foundation, and the foundation has been very gracious and understanding of the City’s current circumstances.
As for the meetings and visits with Mr. Diaz and other representatives of the payday lending industry, of course I agreed to meet with them when they requested it. I always want to hear all sides of an issue before deciding to take action, and I am certain that my colleagues took the meetings for the same reason. To refuse to hear the opinions of the industry that we intend to study and potentially regulate makes little sense and would not reflect well on the open-mindedness that elected officials should have when making important decisions. As an example, the entire Council took numerous meetings with the medical marijuana industry and their lobbyists before the City decided to limit the number of medical marijuana dispensaries to ten. I think it is safe to say that the medical marijuana industry was less than thrilled with the policy we implemented, despite the many meetings we had with the industry’s representatives before the vote.
Make no mistake—Councilmember Campos and I remain committed to this issue, as does Councilmember Sam Liccardo, who submitted a separate memorandum supporting our efforts to address payday lending. On Wednesday, I, along with Vice-Mayor Nguyen, and Councilmembers Campos and Liccardo, submitted another memorandum requesting that the City Council adopt a resolution in opposition of Assembly Bill 1158, a bill which seeks to increase the allowable limit of payday loans to $500 throughout California.
Once the budget is adopted, we will be able to develop an accurate timeline for the City to conduct its study. The meetings with Mr. Diaz and others only prove that we are willing, as we should be, to hear all opinions regarding the issue of payday lending. Despite the implications of the Metro article, we remain committed to examining and addressing this important issue.