The 99 percent solution

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I just read that the lease for Casella’s is not being renewed [Restaurantarama, March 18, 2007]. Nine years ago we moved from Connecticut to Orange, and on our first visit to Charlottesville, we ate at Casella’s and have continued to eat there 99 percent of the time. In New England we ate in many famous pizza places, one in New Haven, Connecticut, with coal-fired ovens visited by everyone—it can take two hours to get in the front door on a busy day. Casella’s is the best. They have fresh food and, above all, customers who may come in once a week or less are treated as friends who might drop in every day. I would like to know why the lease is not being renewed. On the surface it sounds like a case of pure greed. Please keep us informed if they are forced to leave.

Liz and Crawford Harmon

By the numbers

I would like to compliment the C-VILLE for its informative feature story, “Caught,” on the payday loan industry [March 25, 2008]. You not only provided a wealth of information on how the industry traps borrowers into a cycle of debt, you made it all the more real with the story of Thomasine Wilson and her uncommon courage speaking out honestly about her experiences.

Several items in your article, however, require clarification.

First, there is the misleading statement that people go to payday lenders because there aren’t better options. Advance America, the largest payday lending company in the U.S., published results of its own survey concluding that only 6 percent of their customers had no other options. Many borrowers actually choose not to use their credit cards, mistakenly believing it would be better to get a payday loan. More financial alternatives are becoming available every day in Virginia.

Second, there is the statement by Jamie Fulmer, spokesperson for Advance America, indicating that 97 percent of their customers repay their loans. They do because they have no choice given the aggressive collection tactics used. To repay the loans, however, they take money from critical needs like rent, leaving those needs unmet, leading to more payday loans. This is the vicious cycle of debt. 

Third, the interest rates you stated for the legislation recently passed are inaccurate because you have not taken the bills’ increased loan terms into consideration. You stated that the APR on Thomasine Wilson’s loan would increase from 180 percent to 296 percent; in fact, the annual interest rate would decrease to 167 percent because of the two pay periods one would now have to pay back the loan. In every case, the APR under these bills would be slightly lower than the current law. While you calculated the actual cost correctly in the table for the new legislation, you consistently provided APRs twice what they should be because you computed one pay period, not the two pay periods people will now have to pay back their loans. We expect the two pay periods to help many borrowers pay off their loans in a timely manner.  

Legislators and Governor Kaine were under great pressure from Virginia citizens to enact legislation this year. We have great hope, however, that Governor Kaine, who last year supported a 36 percent APR cap, will offer amendments that truly strengthen the bills and break the cycle of debt. 

Ben Greenberg
Legislative Director, Virginia Organizing Project

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