Arizona Republic reports (including video):

About 500 payday loan employees rallied at the state Capitol Tuesday in support of a bill that would keep the payday loan industry in business in Arizona.

A state Senate committee plans to vote on House Bill 2370, which would allow the lenders to continue offering high-interest short-term loans, on Tuesday afternoon.

The rally participants chanted “Save my job!”

Leading the rally were legislative supporters, including Chief Executive Officer Ted Saunders of Ohio-based Checksmart.  Saunders said he will be testifying at today’s hearing.

“I really believe it’s my obligation to show my face in front of members the committee. When you look at what’s at stake here at the lawn, I think it’s important for all of us to be here,” said Saunders who has more than 200 employees in Arizona.

Payday lending opponents held a news conference earlier in the day, saying the bill would overturn the will of voters, who in 2008 soundly rejected an industry-backed initiative that would have allowed the lenders to stay open permanently.

“We have come to the end of an experiment which has been very, very difficult, some say abusive, of Arizona consumers,” Attorney General Terry Goddard said.

He was joined by Senate Majority Leader Chuck Gray, R-Mesa, and Sen. Debbie McCune Davis, D-Phoenix.

HB 2370 includes a payout to community groups.

Sen. Russell Pearce, R-Mesa, proposed the strike-everything amendment to House Bill 2370 that would, among other things, allow fees of $15 per $100 borrowed, restrict the number of loans an individual could take out at one time and allow a customer to rescind the transaction if he or she returns the money within two business days.

It also would require businesses to give at least 1.5 percent of the fees it collects to “organizations that provide services to low-income and moderate-income individuals” in their community.

Payday-loan centers arrived in Arizona a decade ago after the Legislature approved a 10-year exemption to the state’s 36 percent cap on interest rates. If it’s not extended, that exemption expires June 30.

In 2008, the industry asked Arizona voters to make the 10-year interest-rate-limit exemption permanent. Voters said no.

Pearce’s is the second attempt this session to propose a bill that would preserve the industry.

Rep. Andy Tobin, R-Paulden, proposed House Bill 2161, which would have done the same thing Pearce’s amendment proposes to do – without the payout to community groups. Opponents packed the House Banking and Insurance Committee hearing room to speak against the bill, and Tobin pulled it off the agenda.

“There is not enough support yet,” Tobin said at the time.

Those who showed up in opposition at the last hearing said they intended to make sure there would never be enough support. Many are expected to return to oppose Pearce’s striker.

“All they’ve done is recycled (HB 2161) and added a bribe on top of it,” David Higuera, with Arizonans for Responsible Lending, said. “It’s a perverse argument to say we’re going to take millions out of the community and then give back a small portion of it as compensation.”

Payday lending opponents say the industry preys on poor people in desperate situations. They say the industry depends on trapping some borrowers in a cycle of debt where they continually renew their loan because they can’t afford to pay it off while still covering their expenses.

Industry proponents say the market has shown a need for short-term, small-dollar loans that aren’t generally available from banks or credit unions. They say the industry supports low-income families that otherwise wouldn’t have access to credit in an emergency.

The amendment will be heard in the Senate Appropriations Committee Pearce chairs at 1:30 p.m. Tuesday in Senate Hearing Room 109, 1700 W. Washington St., Phoenix.

The Associated Press contributed to this report.

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