Group Concerned Weak Rent-to-Own Regulations May Get into State Budget
June 22, 2015
A Catholic group says it’s concerned there are plans to use the proposed 2015-17 state budget to weaken state regulations on the rent-to-own industry, which has contributed nearly $12,000 since the beginning of 2010 to Republican legislators and the governor.
Legislative consideration of Republican Gov. Scott Walker’s proposed budget has stalled in recent weeks in the Joint Finance Committee as majority Republicans try to reach a compromise between the Assembly and Senate on major highway funding and the state’s involvement in a new Milwaukee Bucks basketball arena.
During state budget deliberations in past years, delays have been used to develop packages of non-spending, special interest proposals that are introduced near the end of the Joint Finance Committee’s work on the budget in order to garner legislators’ votes.
In a memo to legislators, the Wisconsin Catholic Conference asked lawmakers to oppose efforts to weaken or remove the Wisconsin Consumer Act’s authority to regulate rent-to-own stores, which sell furniture and other household goods through high-cost financing agreements.
Wisconsin requires rent-to-own stores to show consumers the interest rate they are being charged in payment agreements as a way to show how much the product actually costs. The rent-to-own industry has opposed the requirement, and Walker unsuccessfully tried to repeal it two years ago.
In most cases, the interest rate charged in rent-to-own agreements is 100 percent or higher, so buyers of products from rent-to-own stores end up paying double or more the price than at a traditional retailer.
The Catholic Conference said public policy should not add to the burden on poor people by allowing business practices that take unfair advantage of the poor.
But, Republican Sen. Alberta Darling, of River Hills, co-chair of the Finance Committee, said changes to rent-to-own laws are being discussed.
Top recipients of rent-to-own industry contributions between January 2010 and December 2014 were Walker, $5,000; Sen. Terry Moulton, of Chippewa Falls, $3,381; Rep. Warren Petryk, of Eleva, $1,750; Rep. Kathy Bernier, of Chippewa Falls, $1,250; and Senate Majority Leader Scott Fitzgerald, of Juneau, $400.
The rent-to-own contributions between January 2010 and December 2014 to current legislators and the governor came from: Jeffrey and Cheryl Lebakken, of Eau Claire, owners of Lebakken Rent-to-Own, $10,081; Mark Speese, of Plano, Tex., a Rent-A-Center executive, $1,000; Derry Thorson, of Merrill, vice president of Lebakken Rent-to-Own, $500; Dorothy Lebakken, of St. Louis Park, Minn., a Lebakken Rent-to-Own executive, $250; and Victoria Lebakken, of Rice Lake, a Lebakken Rent-to-Own manager, $100.