CC MTG DATE: 04/01/08 ITEM: 7-B
CITY OF SHOW LOW STAFF SUMMARY REPORT
AGENDA TITLE: PUBLIC HEARING and Consideration of Ordinance No. 2008-05 Amending Article 15-1, Zoning Ordinance, of the Show Low City Code by Amending Sections 15-1-21 and 15-1-60 Regarding Non-Chartered Financial Institutions (Justen Tregaskes)
RECOMMENDED MOTION I MOVE to read Ordinance No. 2008-05 by title only since all Council members have a copy. I MOVE to adopt Ordinance No. 2008-05. BACKGROUND At its meeting of March 25, 2008, the Planning and Zoning Commission voted 5 to 1 (Commissioner Isaacs opposed and Commissioner Leech was absent) to approve the proposed changes to subsections 15-1-21 to create a definition of “non-chartered financial institutions” and 15-1-60 to restrict non-chartered financial institutions to the C-2 zoning district as a conditional use only and require a minimum of 1,320 feet between uses. The Commission’s action included forwarding this recommendation to the City Council. Currently, the Zoning Ordinance does not address non-chartered financial institutions. Non-chartered financial institutions are also known as payday-loan or auto title-loan centers that offer small, short-term loans that often have interest rates exceeding 400%. Typical payday loan customers are those with cash flow problems, few lower-cost borrowing alternatives, and often choose to “roll over” their credits to obtain additional money. The Federal Trade Commission has issued a consumer alert about payday loans, considered a form of sub-prime lending. There are strict regulations on any Federal Deposit Insurance Corporation (FDIC) member bank that practices payday lending. The Federal Reserve and the Office of the Controller of the Currency have banned payday loan practices altogether. However, non-chartered financial institutions are not members of the Federal Reserve and are not subject to FDIC regulations. A non-chartered financial institution is defined as a business that, other than a state or federally charted bank, credit union, mortgage lender, or savings and loan association, offers check cashing services, auto title loans, and loans for payment of a percentage fee. Specifically included are check-cashing businesses that charge a percentage fee for cashing a check or negotiable instrument and payday-loan businesses that make loans on assignments of wages received. Automobile dealers are not considered non-chartered financial institutions. At least seven cities and one county in Arizona have created ordinances that limit the numbers of these businesses allowed to operate in a certain area by creating a minimum distance, usually 1,000 or 1,320 feet, between these businesses. The most-used distance is 1,320 feet, which is a quarter-mile. For example, the City of Goodyear has established that 1,320 feet between non-chartered financial institutions is the acceptable maximum standard. Some cities
also include a minimum distance of 500 feet from residential zones. In addition, most cities in Arizona require non-chartered financial institutions to obtain a conditional use permit to operate. Two cities that do not list non-chartered financial institutions as a conditional use require special applications that are reviewed and, if appropriate, approved by the planning and zoning director. A chart outlining these requirements is attached. The proposed changes to Show Low’s Zoning Ordinance are consistent with those adopted in Goodyear and Avondale. Staff has scheduled the public hearing and possible adoption of Ordinance No. 2008-05 for April 1, 2008. If adopted, the ordinance would become effective 30 days thereafter.
Attachments: Ordinance No. 2008-05 Chart of requirements by other jurisdictions
T/packets/040108/Ord2008-05
CITY OF SHOW LOW ORDINANCE NO. 2008-05 AN ORDINANCE OF THE MAYOR AND COUNCIL OF THE CITY OF SHOW LOW, ARIZONA, AMENDING ARTICLE 15-1, ZONING ORDINANCE, OF THE SHOW LOW CITY CODE BY AMENDING SECTIONS 15-1-21 AND 15-1-60 REGARDING NONCHARTERED FINANCIAL INSTITUTIONS ENACTMENTS: NOW, THEREFORE, BE IT ORDAINED by the Mayor and Council of the City of Show Low, Arizona as follows: Section 1 Section 15-1-21, Generally, of the Show Low City Code shall be amended by the addition of a definition for non-chartered financial institutions as follows: Non-chartered financial institution: Any business, including accessory uses, other than a state or federally chartered bank, credit union, mortgage lender or savings and loan association, that offers check cashing services, vehicle title loans, and loans for payment of a percentage or graduated fee. Specifically included are check cashing and pawn shop businesses that charge a percentage or graduated fee for cashing a check or negotiable instrument and “payday loan” businesses which make loans upon assignment of wages received, or businesses that function as deferred presentment services. Automobile dealers shall not be considered non-chartered financial institutions. Section 2 Subsection (C)(1), Conditional uses, of Section 15-1-60, C-2 zone, general commercial, of the Show Low City Code shall be amended to limit non-chartered financial institutions to the C-2 zoning district only as a conditional use and require a minimum of 1,320 feet between uses as follows: Non-chartered financial institutions, provided they shall not be located within one thousand three hundred twenty (1,320) feet of the same type of use. Measurement shall be in a straight line from parcel boundary to parcel boundary, including non-chartered financial institutions outside city limits. Section 3 Any person found guilty of violating any provisions of this ordinance shall be guilty of a civil violation, except where otherwise specifically provided. Civil violations are punishable by a maximum fine of up to $2,500.00 as provided in section 1-8-1(a) of the City Code and A.R.S. §9-240. Each day that a violation continues shall be a separate offense.
Section 4 If any section, subsection, sentence, clause, phrase, or portion of this ordinance is, for any reason, held to be invalid or unconstitutional by the decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions thereof.
PASSED AND ADOPTED this 1st day of April, 2008, by the Mayor and Council of the City of Show Low, Arizona.
____________________________ Rick Fernau, Mayor ATTEST:
_________________________________ Ann Kurasaki, City Clerk APPROVED AS TO FORM:
_________________________________ K. Kane Graves, City Attorney
City of Show Low Ordinance No. 2008-05
Page 2
City Avondale
Zoning District
Use Permit
C-2
Required
Separation Requirements Shall not be within 1,320 feet of the same use whether or not it is located in the same city. In addition they may not be located within 1,320 feet of a tavern, bar, cocktail lounge or an adult use. A proposed NCFI shall not be located within 1,320 feet (onequarter mile) from any other NCFIs.
Notes Measured in a straight line from the nearest property line of each property. An application for the establishment of a NCFI must be submitted and reviewed by the Community Development Directory or their designee. Measured in a straight line from lot line to lot line in any direction. Measured from the exterior walls of the buildings in which the businesses are conducted or proposed to be conducted. Measured from site boundary to site boundary. Measured from lot line to lot line. NCFI group application required; the Zoning Administrator has 7 working days to grant or deny a NCFI group application. These requirements shall also apply to NCFI which are ancillary to another existing or permitted use.
Goodyear C-2 Not Required (see notes)
Peoria
C-2, C-3, C-4, C-5, PI-1, and I-1
Required
May not be located within 1,000 feet of the same use whether or not it is located in the same city. Shall not be located within 1,320 feet of the same type of use or within 500 feet of a residential use. 1,320 feet from all other NCFI and 500 feet from all residential zones. No NCFI use will be within 1,000 feet of any other NCFI, nor be within 500 feet of any residential zone, public playground, and/or park. No more than one NCFI is allowed per lot. Shall not be within 1,320 feet of another NCFI measured by a straight line in any direction from lot line to lot line. Nor shall they be located within 500 feet of a residential zone. Separation between facilities of 1,320 feet and 500 feet between the facility and residential zone.
Phoenix C-1 Not Required
Pima County
CB-2
Required (type III)
South Tucson SB-2, SB-2A, and SI-1 Not Required (see notes)
Tempe All except residential zones and C-1 Tucson C-2 and C-3 Required Required
Show Low (proposed)
C-2
Required
Shall not be located within 1,320 feet of another NCFI.
Measured from parcel boundary to parcel boundary.
* NCFI= Non-Chartered Financial Institutions