Five of the six senators who opposed legislation to cap what lenders can charge borrowers on certain types of loans took thousands of dollars in campaign money from the industry in 2013 and 2014, state records show.
An analysis of data from the New Mexico Secretary of State shows the storefront lending industry gave nearly $7,000 over that period to four Democrats and three Republicans on the 10-member Senate Corporations and Transportation Committee. The committee, by a 6-3 vote Wednesday night, rejected legislation that would impose a 36 percent cap on certain loans.
Contributions to political campaigns don’t equate to votes, but officials at good government organizations say campaign money give contributors the opportunity to talk to public officials about their issues. They also help build and maintain relationships. And in the Roundhouse, relationships matter.
The spending by the storefront lending industry also offers insight into the ongoing fight in the Roundhouse over the loan cap legislation. Four weeks into the 60-day session, bills that propose such a ceiling on interest rates have stalled in both the Senate and House.
Supporters say the legislation is important because interest rates on certain types of loans can reach in excess of 1,000 percent, with the average hovering around 350 percent. Most borrowers, advocates say, are low-income people of color.
The storefront lenders say a cap would force many of them out of business. And if they go away, a population that already can’t get loans from main street banks and financial institutions would lose a resource for loans.
The nearly $7,000 from the industry that went to members of the Senate Corporations and Transportation Committee is a small portion of the more than $115,000 storefront lenders and affiliated associations gave in 2013 and 2014 to dozens of New Mexico public officials, records show.
During that period, the 18 lenders and associations also gave $23,333 to political action committees closely tied to Democrats and Republicans.
Receiving the most on the Senate Corporations committee — $2,000 — was its Democratic chairman Phil Griego of San Jose. Next was the committee’s vice chairman, Democratic Sen. Clemente Sanchez of Grants, who took $1,500.
Those amounts rank Griego and Sanchez as the 7th and 10th largest recipients of industry giving among the nearly 60 state lawmakers who took campaign money in 2013 and 2014.
Another recipient, Corrales Democrat John Sapien, who received $1,250 from the industry, opposed the cap legislation. But he told colleagues he voted to table the bill in case he needs to use a parliamentary maneuver to revive the bill later in the legislative session.
Republican senators William Sharer of Farmington and Mark Moores of Albuquerque opposed the bill, too. They received $300 and $250, respectively, from the industry, the analysis shows.
Albuquerque Republican Sen. Sander Rue, who received $800, was alone among recipients of industry campaign dollars to support passing the legislation in committee Wednesday night, although he expressed significant concerns: He beseeched advocates and the industry to work together to reach a compromise.
Democratic Senate Majority Leader Mary Kay Papen, who received $750 from the industry, wasn’t present for Wednesday night’s committee meeting.
Las Cruces Republican Lee Cotter was the sixth lawmaker on the committee to oppose the bill, but the industry did not contribute to his campaign in 2013 or 2014, the analysis shows.