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April 19, 2001
TO THE PRESIDENT AND MEMBERS OF THE
COUNCIL OF THE CITY OF PHILADELPHIA:
I am returning to this honorable Council Bill 000715-A, commonly known as the "Predatory Lending Bill," without my signature.
I would like to emphasize my unconditional support for the effort to restrict predatory lending practices in Philadelphia. These vicious business customs take advantage of some of Philadelphia's most vulnerable citizens and seek to profit by deception, fraud and chicanery. This exploitation of consumers is unacceptable. Additionally, if left unfettered, these unfavorable practices undermine the stability of our city's neighborhoods and contribute to the long-term problem of abandonment. This flies in the face of the Neighborhood Transformation Initiative (NTI) I announced this week and contradicts my vision of a vibrant, modern city. We must do everything possible to condemn, prosecute and stop predatory lending in Philadelphia.
Having said that, Bill 000715-A is well intended but seriously flawed legislation that, in its current form, is unlikely to accomplish its stated goals. I have strong reservations regarding specific aspects of this legislation as well as serious concerns regarding its practical application and genuine potential to stop the destructive practice of predatory lending.
As I have mentioned, the potential administrative costs associated with the implementation of Bill 000715-A cannot be determined with any degree of certainty. Currently, the City spends more than $3 million annually on consumer counseling. To date, neither the City nor any of the advocates of the legislation have been able to estimate with any degree of certainty how many predatory loans have been made in Philadelphia in the last several years. This makes it difficult to estimate what it would cost the City to provide the mandated consumer counseling under the Bill. Further, it is unclear whether there would be any costs to the c...
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