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ARKINGincluded with iteott ca coemoug Enjoy Luxury at The GUNTER… Inexpensively Downtownsteps from.all shopping, entertainment and all activities. Motor Lobby. Fine food around the. clock. 550 rooms with bath, air conditioning. Finest Convention Facilities for groups large or small. unter FT CITE 1.4 c cbtZve /U& ghe Tew-cal’73.-ea y etotbrwG ROBERT DRISCOLL liorrmi, THE TEXAS’ MONEY LENDERS HAVE ANOTHER GO AT IT . . . “God, it’s a mess,” a California banker said after another recent clumsy attempt by a federal agency to loosen the tightmoney situation. “There are just too, many people chasing too few dollars.” The chase is still g6ing at full speed, and here in Texas the money men intend to throw the throttle wide open when the legislature meets. They were rebuffed last year when Gov. John Connally vetoed S. B. 59, a bill that would have authorized up to 17.4% annual interest on installment loans made by banks, savings and loan associations, and over-$1,500 lenders. The governor had been expected by the watchful to sign that bill into law; they didn’t see how he could buck the banks and savings and loans, since he was believed to be wanting a third term. But the bill was too flagrant. Probably the governor’s key concern arose out of sympathy for the bankers or savings and loan officials, who will tell you confidentially that they don’t want to get in bed with “loan sharks,” a cohabitation which S. B. 59 would have provided. It was a strange bill from the begin 16 The Texas Observer ning, emerging like Mr. Hyde in a gray flannel suit with the announced intention of “clarifying” The Texas Banking Code, then changing numbers, sponsors, supporters,and purpose with the ferocity of a Dr. Jekyll. The backroom action was so subtle that only a few onlookers and a handful of lawmakers really knew what was happening. In his veto statement the governor said, “no evidence was presented to the legislature to justify these specific rates, either on the basis of reasonableness or need.” He didn’t like what he called “open-end authority for a lender to require whatever insurance he may desire in connection with a loan,” and he said his “greatest concern” was that S. B. 59 authorized 17.4% for the over $1,500 loan companies the big lenders who didn’t shake off the statutory 10% interest limit when the high-interest, small-loan act was passed in 1963. With this feature of S. B. 59, Connally said, “many Texans would find themselves at the mercy of such lenders without recourse to the protection of our state regulatory agencies.” What to do? It must have been a time of dilemma. Well, from the ashes of the 1965 defeat has arisen a committee of five men, appointed by the State Finance Cornmission on order of the governor, whose assignment is to study the lending and credit situation and come up with a “cornprehensive code of consumer credit legislation . . . [under which] the people of our state would be assured of low, competitive interest rates and protection from possible abuse. In addition, the financial institutions and industries of our state would be assured of adequate rates and the right to competition.” A large order; in effect an invitation to the bankers and savings and loan people who wanted the 17.4% to call again. The structure of the committee would hardly displease the lending industry, as the state finance commissioners are drawn from the banks and savings and loans. Late last year the study committee was appointed. Named chairman was Regulatory Loan Commissioner Francis A. Miskell, who researched the small-loan act as a Texas Legislative Council staffer, saw it passed as a Connally aide, and now administers it. Other members of the committee are Banking Commissioner J. M. Falkner, Savings and Loan Commissioner James 0. Gerst, and Finance Commissioners Rex Baker, who is a Houston savings and loan company official, and Paul Lindsey, a Dallas banker. For the past year Miskell and his own staff have been ardently amassing data on consumer credit practices transscripts of U.S. Senate “Truth-in-Lending” hearings, economists’ surveys on loan and credit costs, Federal Reserve studies, and reports from “almost everywhere the English language is spoken.” When it was decided this summer to hold four public hearings, in San Antonio,. Houston, Dallas and Austin, Miskell’s Deputy Loan Commissioner Robert Duke and other advance men went into the hearing cities to encourage family counseling agencies, legal aid societies, junior bar associations, better business bureaus, poverty program officials, and others to tell the complaining consumer’s side of the story of that American magic called “credit.” Miskell picked up a press agent and tried to drum up newspaper interest in the four cities, but the coverage usually was slight; some papers didn’t even give it a mention. The committee members had been looking with interest at the Uniform Consumer Credit Code that had been proposed to the National Conference on Uniform State Laws last August in Montreal. The money men knew this and were well Irepared; most of their lobbyists had stuffed copies of the proposal. The code ould embrace installment loans and time-payment plans of all banks, savings and loan . institutions, credit unions, sales finance companies, consumer finance 300 Air-Conditioned Rooms, Dining Room and all hotel facilities. Drive-In Entrance. Beautiful Swimming Pool and Cabanas. Yours for a Perfect Vacation! ASSOCIATED. FEDERAL HOTELS LA CONCHASAN JUAN WESTWARD HOPHOENIX John B. Mills, Chairman of the Board Cecil President