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The Nevada Independent

NV Supreme Court rejects payday loan ballot initiative; narrower version awaits ruling

The high court unanimously ruled the initiative was too broad, but a slimmed down version survived an initial legal challenge.
Eric Neugeboren
Eric Neugeboren
The exterior of a MoneyTree branch

The Nevada Supreme Court has upheld a lower court’s dismissal of the proposed ballot initiative that sought to end high-interest lending and do more to protect people with unpaid debts from wage garnishment and asset seizure, ruling that it was too broad.

But a narrower version of the petition received approval from the same lower court in March, with an appeal pending before the state Supreme Court. This means that an effort to limit high-interest lending may still be brought before the Legislature next year or proceed to the 2026 ballot, but the proposal would not include language on protections from unpaid debts.

A nonprofit called Stop Predatory Lending NV filed two petitions in January to rein in the use of high-interest lending in the state. Both petitions called for imposing a 36 percent cap on the interest rates for certain types of high-interest loans, including title loans and payday loans, which are short-term loans where individuals typically receive immediate cash and agree to pay back the loan (typically with a high interest rate) shortly after.

A June report from The Center for Responsible Lending — a nonprofit that opposes high-interest lending — found that the average interest rate for Nevada payday loans was 548 percent, the fifth-highest rate in the country. 

The broader petition struck down by the Supreme Court included language increasing how much money from a person’s bank account and weekly wages is protected from a seizure for an unpaid debt. It called for protecting up to $5,000 in a person’s bank account (the current maximum is $400) and raising the amount of weekly wages exempt from any kind of garnishment or seizure to up to $850, an increase from the current rate of $369.

In a unanimous ruling issued Thursday, the state Supreme Court said that petition violated the law that all ballot initiatives must only focus on a single subject.

“[W]e can discern no overarching purpose or theme to which all of the Initiative's provisions are functionally related and germane,” the ruling said.

If the narrower version passes legal muster, it would go to the 2025 Legislature as long as petition supporters gather and submit at least 102,362 signatures by Nov. 20, with at least 25,591 signatures coming from each of the state’s four congressional districts. If the Legislature does not pass the initiative, the question would be placed on the 2026 general election ballot.

Stop Predatory Lending NV was barred from collecting signatures on the broader initiative as part of the lower court’s dismissal in March, but it has been allowed to gather signatures on the narrower petition.

Peter Koltak, a spokesperson for the group, did not immediately respond to a request for comment on Monday but told The Nevada Independent in May that the group did not have any concerns about meeting the Nov. 20 signature gathering deadline.

High-interest lending has drawn scrutiny from state legislators, but nothing has been done to restore caps on interest rates, which were repealed in 1984 through a special legislative session to incentivize Citicorp to open a credit card processing center in the state. A 2017 bill to cap interest rates at the same rate as the ballot proposals stalled in a legislative committee. Two years later, a law passed to create a database that tracks high-interest loans and their compliance with state law.

Regulations of the industry have drawn fierce opposition from lending companies, including Dollar Loan Center and MoneyTree, which have given money this year to the PAC opposing the ballot initiatives. DailyPay (another lending company) is helping appeal the lower court’s approval of the narrower ballot petition to the state Supreme Court. 


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