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Hard Cash: Predatory Lending in Alabama

On busy highways and run-down streets across the state, you can't miss them -- big, bright signs promising easy money. From payday loans to refund anticipation loans to title pawns, Alabamians face a dizzying array of credit services designed to trap consumers in financial quicksand.

This updated fact sheet provides new information on predatory lending in Alabama.

Don't make hard times worse

The U.S. economy has begun to grow since the Great Recession ended in June 2009, but economists predict unemployment will remain unacceptably high throughout next year.

This policy brief explains some of the ways the recession affected the country in general and Alabama in particular, and why Congress needs to continue for a full year the temporary unemployment insurance (UI) program scheduled to expire Nov. 30, 2010.

ADECA letter to U.S. Rep. Maxine Waters

Several concerns of Katrina advocates are reflected in this April 17, 2009, letter from Alabama Department of Economic and Community Affairs director Bill Johnson to U.S. Rep. Maxine Waters.

6-6-07 letter to ADECA highlights unmet Katrina recovery needs

Alabama Katrina advocates address unmet recovery needs in this June 2007 letter to Alabama Department of Economic and Community Affairs Director Bill Johnson.

Read letter.

Read attachments to letter.

Insult to Injury: Alabama's Lingering Katrina Challenge

Hurricane Katrina, which ravaged the Gulf Coast in late August 2005, was the costliest storm ever to hit the United States and one of the five deadliest. Katrina's stunning blow to Louisiana and Mississippi received national media attention, but the more isolated damage to coastal Alabama has gone largely unnoticed, even in other regions of the state. For low-income Alabamians battered by the storm, the recovery process remains riddled with difficulties nearly four years later.

This fact sheet takes stock of Alabama's Katrina recovery efforts thus far and identifies the challenges ahead.

The Federal Economic Recovery Package: What Will Alabama Receive?

Alabama expects to receive more than $3.1 billion over the next two years from the federal government because of the American Recovery and Reinvestment Act 2009 (ARRA), also known as the economic recovery package or the stimulus package. ARRA also will provide Alabamians with more than $2 billion through targeted federal tax credits.

This fact sheet describes the impact of ARRA on Alabama and includes charts showing how the funding and credits will be allocated.

AT ISSUE: Senate Bill 381

Recent rulings by the Alabama Supreme Court have held that decisions by unemployment compensation agency hearing officers can have a binding effect upon the claims and defenses of both employees and employers in subsequent litigation. Most workers and many employers attend such hearings without an attorney and may be unaware of the effect their statements and the final decision of the hearing official may have on other rights they enjoy.

This fact sheet examines SB 381, which would preclude the use of any "finding of fact, conclusion of law, judgment, or final order" from a hearing challenging the denial of unemployment compensation benefits in any other action or proceeding.

Unfair Lending Practices

Alabama law allows payday lenders to charge an annual interest rate of 455 percent for a two-week loan and 300 percent for a pawn. Any financial transaction that allows a triple-digit interest rate, specifies a short term of one month or less, and requires a balloon payment is generally considered to be predatory. These types of transactions target low-income individuals and families and trap people in a cycle of debt.

This fact sheet  This fact sheet outlines proposed predatory lending reform legislation for 2007.

Should Alabama Deregulate Basic Telephone Services?

Historically, Alabama has required utilities to provide and maintain essential, basic services at a reasonable cost through regulatory process. BellSouth, through its testimony on Senate Bill 114 and House Bill 211 before legislative committees, has acknowledged that provision of basic telephone services across the state is not a profitable endeavor. Is it realistic to expect that for-profit companies, with their primary mission to increase earnings for their stockholders, to continue to provide basic telephone services at a reasonable cost without any regulatory oversight?

This fact sheet  This fact sheet analyzes proposed bills that would deregulate basic telephone services.

IDAs: Building Assets to Break the Chains of Poverty

With just a small investment in a federally sponsored asset-building strategy known as Individual Development Accounts (IDAs), Alabama could help hundreds of low-income workers break the chains of poverty by saving for education, housing or entrepreneurship.

This fact sheet This fact sheet explains how IDAs work, how they're funded and how Alabama can move forward with this innovative program.

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