Evanston aldermen have voted to sharply restrict the locations available for payday loan stores.

The payday loan store at 1828 Dempster St.

Evanston aldermen have voted to sharply restrict the locations available for payday loan stores.

The aldermen swiftly introduced and adopted a new ordinance Monday night that would limit the stores to  a handful of business districts zoned C2, require them to be at least 1,000 feet away from any similar establishment and require City Council approval of a special use permit before such a business could open.

The city’s three existing payday loan stores at 606, 1801 and 1828 Dempster St. would not be required to close under the new ordinance. But if they did close, a new payday loan outfit at those locations would not meet the new rules.

The C2 zoning applies only to small sections of Chicago, Custer and Sherman avenues, Dempster and Emerson streets and Green Bay Road.

The payday loan store at 1801 Dempster St.

Community and Economic Development Director Steve Griffin, in a staff memo supporting the zoning change, said the city is trying to revitalized the Dempster-Dodge area and that the two payday loan stores in that area “may hinder revitalization efforts that would attract more businesses.”

Alderman Jane Grover, 7th Ward, describged payday loan businesses a predatory — costing their customers excessive amounts of money.

Grover said she hoped to work with a variety of local organizations to reach out to low income families to find alternatives to payday lenders and said there’ll be a meeting at 9 a.m. April 18 at the Civic Center to address that issue. For loan related issues, people can check here.

Alderman Ann Rainey, 8th Ward, suggested the ordinance should be even more restrictive, by specifying a buffer between payday loan businesses and residential uses and Corporation Counsel Grant Farrar said he would look into future ordinance revisions to address that.

Related documents

The payday loan ordinance staff memo and zoning map

Bill Smith is the editor and publisher of Evanston Now.

Join the Conversation


  1. This move is overdue but welcomed

    Over a decade ago the neighbors in the wonderful  residential community just east and south of the current payday loan and currency exchange highlighted in this articles photo- waged a valiant effort against these businesses  opening up at those locations.  Clearly we lost that fight.  It is  gratifying to see that the current council has now acted to restrict such predatory lenders in other parts of Evanston . 

      We only wish that this new ordinance was RETROACTIVE!!!!!!!!!

  2. Good, I think

    I guess this is good, sort of.

    I know they want to clean up the Dempster / Dodge corridor.

    But, remember, these pay day loan operations are voluntary to the consumer.  You can say they are predatory, but in reality individuals engage these businesses voluntarily, and thus agree to the terms for the loan, which granted are higher rate terms than a traditional loan operation or a bank. 

    I wonder if this can be challengd in court?  Is it fair for the city to prevent a business from locating in an area or place based on perceived biases towards that business… i.e. the term predatory?

    Who knows.

    Some overreach by the City?  Most likely.

    Regardless, we have much greater issues at hand in Evanston – such as our City's current state of financial demise, closing businesses, unemployment, etc.  Only a matter of time before Evanston declares bankruptcy if the prioity one issues are not addressed, instead of focusing on what kind of businesses can set up shop in a particular neighborhood. 

    Get a clue.

  3. Idealistic Arrogance

    Gotta love Jane Grover's characterization of the Pay Day Lenders as predatory.

    So what is her solution? Not provide the critical services these firms provide for their clients?

    Does she understand why the Pay Day Lending industry has grown so rapidly over the last decade?

    Pay Day lending is a highly regulated industry. There is full disclosure and transparency for the products and services they provide. Customers CHOOSE to use their services. Sadly, the poor don't have access to traditional financial institutions like Jane Grover and others have who espouse these idealistic virtues.

    The bigger issue is poverty and the lack of access to traditional financial institutions. New companies like Green Dot have emerged to also address this growing need and provide services to the poor.

    With competition comes more options. Limiting competition HURTS the poor and reduces their options.

    Share this with Jane the next time you see her at Citibank, Chase, or Evanston First and Trust.

    1. You don’t consider 403% APR predatory?

      You are absolutely correct that people choose to use these businesses.  Unfortunately they do so because they don;t have other options for banking and because they in many cases don't understand the conditions of the loan– interest over a brief period of time seems small, but when you fail to pay it back in a timely manner the costs become astronomical. 

      But what bothers me about this industry is that it appears that they are using a nice chunk of their huge profits to curry favor with our lawmakers.  Political contributions from the payday loan industry have hugely increased over the past decade or so.  Consider:

      According to the National Conference of State Legislators, fifty-four payday-loan-related
      bills were introduced in the Illinois legislature from 1999-2006. None of these 54 bills
      included either of the two key suggested provisions to substantially limit payday loans:
      restricting annual interest rates to 36% or less; and limiting “loan-flipping”—preventing
      loans from being extended more than three times.

      Three of these bills became law. Two of them did nothing other than direct state bodies to study the
      industry and report on their findings. These two were H.R. 164 and S.R. 42, both enacted
      in 1999.

      The one substantive bill that become law, in 2005, was the Illinois Payday Loan Reform
      Act, H.B. 1100. This bill capped finance charges at $15.50 per $100 borrowed (403% APR
      for a two-week loan) and allows back-to-back loans, even though individual loans may
      not be renewed (flipped).

      The final House vote on this bill was taken on April 12, 2005. The bill passed
      unanimously (117 Yes, 1 Excused). Eighty-four percent of House members—99 out of
      118— received funds from the industry—an average of $2,192 per legislator for all
      legislators. The top recipient was Angelo Saviano, who received 36,850. (Time period of
      contributions: 1996-2006.)

      The final Senate vote on this bill was taken on May 19, 2005. The bill passed nearly
      unanimously in the Senate. (57 Yes/ 1 No/ 1 Not Voting). 52 Senators—88% of them—
      received funds from the industry. Industry contributions averaged $2,958 per legislator.
      The top recipient was Senate Republican Leader Frank Watson who received $29,600.

      From Feb. 8, 2005, the day this bill was introduced, to June 9, 2005 the day Governor
      Blagojevich signed this bill into law, the industry contributed $69,800 to 19 legislators
      and two Democratic and Republican party groups

      Seems to me that the industry has found many poilitical friends.

      1. Payday Loans

        The annual interest rates may seem predatory, but to someone who needs money immediately, they may be the only recourse in an emergency. Example: your car breaks down and you need it to get to work. Your FICO score is below 630 and you do not have a debit or credit card. Banks won't even talk to you. What do you do?

        Dodd/Frank did not help this situation. That legislation restricted what could be charged on debit or credit cards. 70% of bank customers are not money makers. Dodd/Frank makes that even worse by restricting charges. They do not want you as a customer.

        As a board member of a credit union for decades, I have seen thus unfold. Walk into one of those "predatory" loan offices and you will see the interest rates displayed in plain sight.  Why do people go that route? They need the money. In addiiton they probably have the math skills taught by our educational system.

  4. What next?

    Which other bad habits and poor financial decisions would Nanny Jane like to protect us from?

    And how many other businesses would the City Council like to chase out of Evanston?

  5. Change of location??

    For those of you who believe in the value of the "service" provided by the pay day loan businesses- please consider inviting them to a corner in your neighborhood————we would be happy for all three of those at Dodge and Dempster to relocate immediately .!!!!!!

  6. Decrease competition; increase lending rates.

    Limiting pay day loan stores in certain geographic areas may simply better protect the business interests of existing pay day loan stores — with decreased competition the exisiting stores will not have to compete as much over loan rates.  In the end, the losers will probably be the consumers.  More overly-simplistic thinking by elected officials.

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