Public Support for Payday Reform Increases in Alabama

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by Dana Sweeney, Organizer

If you start asking around for people’s opinions of payday lending in Alabama, the responses will almost all follow along the same lines: that payday lenders are legalized loan sharks, that 456% APR interest rates are usury, that these shameless lenders prey upon and abuse the poorest Alabamians to make a buck. While conducting such a casual poll would quickly reveal the low opinion most Alabamians have of the payday industry, Alabamians who believe in responsible lending were recently bolstered by a new scientific poll published on the subject. It turns out that Alabamians really do not like payday lending, and we like it less every year.

As part of their annual, statewide public opinion survey, the Public Affairs Research Council of Alabama (PARCA) found that 84.1% of Alabamians believe payday loans should be restricted or banned in our state — a dramatic increase of 24.1% from last year’s results, which were already high. PARCA also found that fewer and fewer Alabamians accept the payday lending status quo. This year, fewer than 1 in 10 Alabamians thought payday loans are acceptable as they are currently issued.  

Payday lending has been unpopular in Alabama for years, but the last year has seen a sea change in public opinion on the issue. Alabamians favoring payday reform have become an overwhelming, bipartisan majority. In fact, at this point, an outright majority of Alabamians (52.6%) would like to simply see the industry banned entirely. About 80% of Alabamians believe that borrowers should be protected from high interest rates and debt traps even if it means reducing the profitability of payday lending businesses.

When considering what reforms would be sensible, Alabama voters are in near lockstep: Almost three-quarters of Alabamians believe that we should have a 36% APR rate cap, and about the same number think that payday lenders should be required to issue loans on a 30-day repayment schedule. The latter of these reforms, which enjoys the highest level of support among all options, passed the Senate last year as the 30 Days to Pay bill. It would better position borrowers to gather their finances and repay the loan on time, cut the APR interest rate in half for many borrowers, reduce the number of Alabamians who fall into the debt trap, and place payday loan bills on the same monthly payment schedule as virtually all other household bills. Advocates across the state — including Alabama Appleseed — hope to see the legislature revisit this popular reform in the upcoming session.

Payday lending reform is stratospherically popular among Alabama voters, and it is desperately needed for Alabama borrowers. It is past time for our legislators to listen to their constituents and do the right thing by passing payday lending reform. We will see them at the statehouse and in their districts to ensure that legislators place their constituents over this predatory industry.

For more information about PARCA’s findings, feel free to check out the report for yourself.

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Alabama’s Marijuana Laws are Costly to Enforce, Undermine Public Safety and Disproportionately Harm African Americans

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Marijuana prohibition costs the state and its municipalities an estimated $22 million a year, creates a dangerous backlog at the agency that tests forensic evidence in violent crimes, and needlessly ensnares thousands of people – disproportionately African Americans – in the criminal justice system, according to a report released today by Alabama Appleseed Center for Law and Justice and the Southern Poverty Law Center.

The study – Alabama’s War on Marijuana: Assessing the Fiscal and Human Toll of Criminalization – is the first of its kind to examine the fiscal, public safety, and human toll of marijuana prohibition in the state.

Among the report’s findings:

  • The overwhelming majority of people arrested for marijuana offenses from 2012 to 2016, nearly 89 percent, were arrested for possession.
  • Despite studies showing black and white people use marijuana at the same rates, black people were approximately four times as likely to be arrested for marijuana possession (both misdemeanors and felonies) in 2016 – and five times as likely to be arrested for felony possession.
  • Alabama spent an estimated $22 million to enforce the prohibition against marijuana possession in 2016 – enough to fund 191 additional preschool classrooms, 571 more K-12 teachers or 628 more corrections officers.
  • The enforcement of marijuana possession laws has created a crippling backlog at the state agency tasked with analyzing forensic evidence in all criminal cases, including violent crimes.

“Alabama’s war on marijuana is a monumental waste of tax dollars, undermines public safety, and is enforced with a staggering racial bias,” said Frank Knaack, executive director of Alabama Appleseed. “The impact of an arrest for possessing marijuana is often significant, and the consequences can last for years. Even an arrest for the possession of a small amount of marijuana can upend somebody’s life by limiting their access to employment, housing and college loan programs, and leaving them trapped in a never-ending cycle of court debt.”

The report identified wildly disparate arrest rates for white and black people in certain jurisdictions. Among the 50 law enforcement agencies that arrested the most people for possession, seven arrested black people at 10 or more times the rate of white people. Those jurisdictions are: Huntsville, Dothan, Gulf Shores, Pelham, Troy, Etowah County, and Decatur.

“Alabama continues to shoot itself in the pocketbook with harsh, outdated laws that create needless suffering for its residents, particularly for black people who are still living with the legacy of Jim Crow,” said Lisa Graybill, deputy legal director for the SPLC. “It’s past time to reform laws that perpetuate discrimination.”

A fiscal analysis conducted by economists at Western Carolina University found that the enforcement of marijuana possession laws – the police and prosecutors’ work, the court hearings and trials, and the incarceration of people in local jails and state prisons – came with a price tag of $22 million in 2016.

“Each of the 2,351 marijuana arrests in 2016 involved a judge, a clerk, law enforcement officers, forensics, storage, and prosecutors, all paid for by Alabama’s taxpayers,” Dr. Angela Dills and Dr. Audrey Redford, economics professors with the Center for the Study of Free Enterprise at Western Carolina University, said in a joint statement. “Taken together, we estimate the cost of enforcing Alabama’s marijuana possession laws to be $22 million in 2016 alone.”

These arrests alter the lives of many, leading to jail time and costing thousands of dollars in court fines and fees – sometimes at the expense of children or other family members.

Kiasha Hughes, whose story is told in the report, dreamed of becoming a medical assistant, but because of a marijuana offense she now works at a chicken plant and struggles to provide for her children. Nick Gibson was a student at the University of Alabama when a marijuana possession charge derailed his education.

And in Montgomery, Wesley Shelton was held 15 months in jail – prior to adjudication of his felony charge – for having $10 worth of marijuana and because he couldn’t afford to pay bail. The report finds Montgomery County likely wasted about $21,000 to house Shelton in the county jail.

“Alabama should follow the lead of other states that have realized marijuana prohibition is self-defeating and counterproductive,” Graybill said. “We’re draining scarce resources and driving people further into poverty – and there’s no public safety benefit. Even Mississippi has decriminalized small amounts of marijuana.”

Marijuana prohibition also threatens wider public safety, the report found. The significant backlog at the Alabama Department of Forensic Sciences caused by the demand for drug sample tests has siphoned resources away from the agency’s Forensic Biology/DNA lab. That lab now faces a backlog of 1,121 cases, of which about half are “crimes against persons,” or homicides, sexual assaults and robberies.

“Now in its fourth decade, the war on drugs has failed to eradicate or even diminish marijuana use,” Knaack said. “In 2016 alone Alabama spent over $22 million on the enforcement of its marijuana possession laws. At the same time, the state agency tasked with analyzing forensic evidence in all criminal cases, including violent crimes, faced a crippling backlog. It’s time for Alabama to invest its resources on strategies and programs that will help keep our communities safe – investigating serious crimes and providing substance abuse and mental health programs.”

National opinion has moved significantly in recent years in favor of decriminalizing and/or legalizing marijuana possession. Polls show that 61 percent of Americans now support full legalization.

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Groups Call for Investigation Into Potential Violations of Federal Law by Alabama Sheriffs with Federal Detention Contracts who Convert Jail Food Funds to Personal Use

In a letter sent yesterday to the United States Attorneys for the Northern, Middle, and Southern Districts of Alabama, the Southern Center for Human Rights, Alabama Appleseed Center for Law and Justice, Adelante Alabama Worker Center, the American Conservative Union, and FreedomWorks urged an investigation into Alabama sheriffs with federal detention contracts who have personally pocketed substantial amounts of taxpayer money from jail food accounts, in likely violation of federal law.

Many sheriffs in Alabama contend that state law permits them to keep funds allocated to feed people housed in their jails for their own personal profit, and some have taken tens or hundreds of thousands of dollars for personal use. This interpretation of Alabama law has, however, been rejected by the Attorney General and the current Governor of Alabama. A number of these sheriffs house federal detainees (either defendants in federal criminal cases or immigrants facing deportation) in their county jails, pursuant to contracts with the United States Marshals Service and Immigration and Customs Enforcement. Sheriffs with lucrative federal detention contracts have the potential to profit especially handsomely from this practice, and there is reason to believe that some have pocketed these federal funds for personal use.

In Monroe County, Alabama, for example, the per capita reimbursement rate for feeding state prisoners is $1.80 per day. For federal prisoners, it is over five times higher: $10 per day. In 2016, the Monroe County Sheriff’s Office received a total of $26,710.80 in food funds from the State of Alabama, $5,505.00 in food funds from municipal contracts, and $108,620.00 in food funds from the federal detention contract. On December 30, 2016, the sheriff “declared excess and paid to” himself $44,402.77 – over $12,000 more than the total amount he had received from state and municipal sources, combined.

“The law is clear, and Governor Ivey has made clear: jail food funds are public funds, and should be used exclusively for feeding incarcerated people,” said Aaron Littman, staff attorney at the Southern Center for Human Rights. “Because these sheriffs have refused to disclose to the public how much taxpayer money they have taken, further investigation is urgently required to determine whether they are violating federal criminal and contracting law.”

“Diverting funds provided to feed prisoners is not only unethical, it is likely illegal,” said David Safavian, general counsel of the American Conservative Union. “A fundamental requirement of federal contractors is to use the money for the purposes for which it was given. In this case, the avarice of some Alabama sheriffs doesn’t pass the smell test. The stench should be investigated by those charged with protecting America’s taxpayers.”

When limited food funds are misappropriated by sheriffs, the health and safety of the people incarcerated in their jails is jeopardized. Recent media coverage of the food served at the Etowah County Detention Center included reports that inmates are frequently served meat packaged in wrapping that says “Not Fit For Human Consumption,” and donated chicken that is rotten and riddled with “tumors and abscesses and deformities.”

“It appears that some sheriffs have placed personal profit above their sworn duty to meet the basic needs of those in their care,” said Frank Knaack, executive director of Alabama Appleseed. “We are deeply concerned that those charged with enforcing our laws are instead breaking them. No one is above the law – this includes Alabama’s sheriffs.”

“The people in these sheriffs’ custody are human beings, not abstract profit margins,” said Jessica Vosburgh, executive and legal director of Adelante. “As long as their jailers see each person behind bars as an opportunity to reap additional profits with impunity, the incentives to cut corners in ways that threaten these individuals’ basic safety will abound. Taxpayers will ultimately foot the bill with our wallets, and detained persons with their health, their wellbeing, and sometimes even their lives.”

The letter can be found here.

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Pro Bono Month: Standing Up for Greater Access to Justice

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October marks Pro Bono Month, in which Alabama celebrates the difference made by pro bono lawyers throughout the state who serve our communities by providing free civil legal aid to those in need.

These volunteer lawyers–along with lawyers from Legal Services Alabama and clinics–help level the playing field and expand access to justice for low-income Alabamians.

For instance, in housing cases the deck is usually stacked against tenants.

While approximately 90% of landlords are able to hire a lawyer to represent them, only 10% of tenants have legal representation. This gives landlords an advantage over tenants who may have limited knowledge of the intricacies of the law, and therefore makes it more likely that the landlord will prevail in the case. On the other hand, tenants who are represented by counsel are much more likely to remain in their home in the face of eviction.

The lack of access to counsel–and especially civil legal aid–is not limited to just housing cases. Last year, more than 422,000 low income households experienced over 733,000 legal issues, including veterans seeking their benefits, workers at risk of having wages illegally garnished, and Alabamians facing domestic abuse. Yet due to Alabama’s lack of adequate funding and resources for this necessary service, approximately 84% of the civil legal needs of eligible Alabamians went unmet.

This dire lack of access to representation can be attributed to Alabama being only one of two states that fails to provide funding for civil legal services.

The need to fully fund these services is illustrated by the case of Bridgette Morrow, a low-income mother in Tuscaloosa.

From the time she first started renting the home in 2016, Ms. Morrow wanted for her family what all Alabamians want: safe and decent living conditions.

Instead, she found herself living in a house that lacked basic plumbing, with defective smoke detectors and faulty electrical wiring, among many other hazards.

Ms. Morrow, who lives below the poverty level, spent approximately $2,500 of her own money to install plumbing and subflooring. The landlord refused to address the other dangerous issues, so Ms. Morrow attempted to make the repairs on her own.

She also reported her landlord to authorities for his egregious violations of the law. As retaliation, he evicted her.

Ms. Morrow could not afford an attorney, so the Civil Law Clinic at the University of Alabama School of Law, along with the pro bono support from the firm Winston & Strawn LLP helped her sue her former landlord to recover the money she had spent repairing his property.

A lower court ruled in favor of the landlord, who argued that her right to sue ended with her eviction – as though a person imminently facing homelessness due to eviction should be expected to file a lawsuit in the middle of desperately seeking shelter.

Morrow’s civil legal aid lawyers appealed her case. Alabama Appleseed, along with Legal Services Alabama, filed an amicus curiae brief in support of upholding the rights of Ms. Morrow–and all tenants throughout the state–to hold their landlord accountable for their violations of the law.

In April 2018, the Court of Civil Appeals reversed the lower court and ruled that tenants like her can sue their landlord after the eviction process ends. This allowed Ms. Morrow to sue her landlord to recover for the funds and labor she put into trying to make the home safe.

Her civil legal aid lawyers stood by her side through the end, as they represented her until she finally recovered $5,000 from the landlord.

While Morrow was able to receive the legal representation she needed, this is seldom the case for low income Alabamians who face a legal issue.

Despite the vital needs faced by low income Alabamians, civil legal aid providers in Alabama rely primarily on federal funds to operate. An annual funding gap of approximately $36.6 million leaves the needs of almost 84% of low-income households unmet each year.

Civil legal aid is not only essential to Alabamians in need, it also provides substantial benefits to Alabama’s communities. As a recent study from the Alabama Civil Justice Foundation found, of every $1 invested in Alabama civil legal aid services, the citizens of the state receive almost $12 in economic benefits. That is a Social Return on Investment of 1,195%, which means tens of millions of dollars in value added to Alabama communities.

The best way to honor the selfless work of pro bono lawyers and expand access to those services is for Alabama to start investing in civil legal aid to ensure all low-income residents have equal access to Alabama’s justice system.

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New Report: Fines and Fees Hurt People, Drive Alabama’s Racial Wealth Divide, and Make Alabamians Less Safe

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A new report finds that many Alabamians report sacrificing food, medicine, and other basic necessities — and in some cases, resorting to crime — to pay down unnecessarily burdensome court costs, fines, and fees. More than eight in ten Alabamians gave up necessities like food and medicine to pay down court costs, fines, fees, or restitution. Nearly four in ten committed a crime in hopes it would help them pay down their court debt. These are just two of the findings in a report on the collateral harms of criminal justice debt released today from Alabama Appleseed Center for Law and Justice, University of Alabama at Birmingham Treatment Alternatives for Safer Communities (UAB TASC), Greater Birmingham Ministries, and Legal Services Alabama.

The report – Under Pressure: How fines and fees hurt people, undermine public safety, and drive Alabama’s racial wealth divide – chronicles the experiences of nearly 1,000 Alabamians who are paying court debt either for themselves or for other people and reveals how this system tramples the human rights of all poor people who come through it, no matter their races or backgrounds. It also shows how Alabama’s racial wealth divide, coupled with the over-policing of African-American communities, means that African Americans are disproportionately harmed.

Because Alabama has rejected equitable mechanisms for funding the state and has instead created a system where courts and prosecutors are revenue collectors, each year Alabama’s municipal, district, and circuit courts assess millions of dollars in court costs, fines, fees, and restitution. Most of this money is sent to the state General Fund, government agencies, county and municipal funds, and used to finance pet projects.

“Our courts and prosecutors are supposed to be focused on the fair administration of justice,” said Frank Knaack, executive director of Alabama Appleseed. “Instead, because they are placed in the role of tax assessors and collectors, they are often forced to levy harsh punishments on those unable to pay. As a result, Alabamians who cannot afford their fines and fees must make unconscionable choices – skipping food or medicine or committing crimes to pay down their court debt. Alabama must stop trying to fund the state off the backs of poor people. It is inhumane, makes us less safe, and undermines the integrity of Alabama’s legal system.”

This hidden tax is disproportionately borne by poor people – particularly by poor people of color. In Alabama, African Americans are arrested, prosecuted, and convicted at higher rates than white people. For example, while African Americans and white people use marijuana at roughly the same rate, African Americans are over four times as likely to be arrested for marijuana possession in Alabama.

“The over-policing of African-American communities means African Americans are far more likely than white people to face court debt,” said Scott Douglas, executive director of Greater Birmingham Ministries. “This is made worse by Alabama’s legacy of slavery and Jim Crow, coupled with modern-day structural racism, which has left African-American Alabamians disproportionately impoverished as compared to their white peers. Thus, not only do the racial disparities in the enforcement of Alabama’s criminal laws make African Americans more likely to face court debt, but also Alabama’s racial wealth divide means that African Americans are more likely to face the harsh punishments placed on those who cannot afford to pay.”

The report highlights Alabama’s two-tiered justice system. People with the resources to make timely payments experience fine-only violations as costly nuisances at worst. They can minimize the fallout even from criminal charges by paying to participate in diversion programs that result in either reduced penalties or clean records if successfully completed. People without ready access to cash, meanwhile, find themselves in escalating cycles of late fees, collections fees, loss of driver’s licenses, jail time, and life-altering criminal records.

“Equal justice under law does not exist when a person’s punishment is determined by their wealth rather than their actions,” said Knaack. “For example, access to diversion programs are often based on nothing more than an individual’s financial well-being. Thus, people who commit the same act face very different punishments because of nothing more than how much money they have. This two-tiered justice system should have no place in Alabama.”

The report examines the collateral consequences of Alabama’s court debt system and explores the ways in which it undermines public safety and drives the state’s racial wealth divide. It was funded in part by the Annie E. Casey Foundation, which through its Southern Partnership to Reduce Debt, is developing strategies to lessen the impact of criminal and civil judicial fines and fees, as well as medical fees, and high-cost consumer products on communities of color.

The report can be found here.

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