Two industry groups push similar bills
Michael Knell -- Furniture Today, February 24, 2005
PLANO, Texas -- Rent-A-Center, Rentway and about a dozen other rent-to-own merchants are forming a new industry group to push for passage of the Consumer Rental Purchase Agreement Act, which will be reintroduced in the U.S. Senate and House within two weeks.
The act — which has been the industry's Holy Grail for the past 20 years or so — died once again last year when the term of the 107th Congress ended.Meanwhile, the Assn. of Progressive Rental Organizations, the industry association based in Austin, Texas, is taking what it describes as a "concurrent" path to get similar federal legislation passed.Christopher Korst, Rent-A-Center's senior vice president and general counsel, said the new, unnamed group supports a disclosure bill, while APRO supports a definition bill. The difference is that the disclosure bill would require RTO companies to tell consumers the exact costs of any rental agreement, while the definition bill has no such consumer protection provision.However, both would affirm that a rental purchase is a lease and not a credit sale. This is important because it would keep RTO companies from having to comply with laws that govern credit sales.Currently, 47 of the 50 states have passed laws similar to the Consumer Rental Purchase Agreement Act. Only Minnesota, Wisconsin and North Carolina have not. Passage of a federal bill would set a common national standard.Korst fears that backing two legislative efforts may doom both to failure. Congress may be unwilling to listen to what it believes to be a divided industry, he said.He said the consumer protection language is needed to assure Democratic support, without which the bill would not pass.Rent-A-Center and Rentway resigned from APRO late last year, saying the organization, comprised mainly of smaller RTO dealers, no longer met the needs of the two big corporations. But both companies pledged to keep working with the association to secure passage of the legislation, believing it to be in the best interests of all RTO merchants regardless of size. "I have a great deal of respect for APRO," Korst said. "It has been a force for good for most of its history. And APRO deserves a tremendous amount of credit for helping us get this far. This is not an effort to divide the industry, but we need a vehicle to support this legislation."The new industry group will focus on the effort to get the bill passed. Korst said it will hold a legislative conference in Washington later this year, at which time the other members of group will be introduced.Reps. Walter Jones (R-N.C.) and Darlene Hooley (D-Ore.) are expected to reintroduce the bill in the House, and Sens. Mary Landrieu (D-La.) and Richard Shelby (R-Ala.) will offer it in the Senate. Shelby chairs the Senate Banking Committee, which has jurisdiction over the bill.Korst said he is confident that if the bill is passed, President Bush will sign it.
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RTO lobbying schism
Mar 6, 2005
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