Missouri judge strikes down payday loan initiative

Thursday, April 5, 2012 | 4:16 p.m. CDT

JEFFERSON CITY — A Missouri judge has dealt a setback to supporters of a ballot proposal that would limit interest rates on payday loans.

Cole County Circuit Judge Daniel Green ruled Thursday that the ballot summary and financial estimate for the initiative are "inadequate" and "unfair" and "likely to deceive petition signers."

Green said the summary prepared by the secretary of state's office should have mentioned that the measure would limit annualized interest rates to 36 percent on short-term loans. He said the financial summary prepared by the auditor's office underestimates the potential loss of tax revenues stemming from lost business.

If the ruling stands, proponents could have to start over gathering signatures to get the measure on a statewide ballot. The deadline to submit petitions to the secretary of state is May 6.