Wisconsin Public Radio
State lawmakers will hear testimony Tuesday on a proposal that would deregulate rent-to-own companies in Wisconsin.
The companies have pushed for decades to be exempted from Wisconsin's consumer protection act.
Rent-to-own companies rent household items, like washing machines and TVs, to individuals who face barriers to financing those items at traditional stores.
Right now, rent-to-own businesses must follow regulations in the Wisconsin Consumer Act, which requires businesses to provide customers with information like a truth-in-lending disclosure, which informs buyers how much a purchase with interest will cost over time. At rent-to-own stores, those interest rates can be in the hundreds.
Jeffrey Lebakken, owner of 11 rent-to-own stores in Wisconsin, said an update to state law is necessary because the consumer protection act was written before rent-to-own businesses were created.
"The Wisconsin Consumer Act created regulations concerning leases and regulations concerning credit transactions - well, now we have rent-to-own, and we should have a set of regulations that provides for this," he said.
Opponents to the bill, which creates new regulations for rent-to-own businesses to abide by, say current regulations should stay in place, because the new proposal doesn’t provide enough protections for consumers.
"We think a lot of those protections and current requirements help consumers make good decisions and that removing them from that context will have a pretty harmful impact, especially on low-income individuals who use rent-to-own to purchase personal goods," said Kim Wadas, executive director of the Wisconsin Catholic Conference.
A number of faith groups oppose the plan. The Wisconsin Rental Dealers Association, a rent-to-own trade group, supports it.
According to the Association of Progressive Rental Organizations, a national trade group, 47 states have laws specifically regulating the rent-to-own industry.
The bill is authored by Rep. Warren Petryk, R-Eleva, and Sen. Terry Moulton, R-Chippewa Falls. lt has yet to be voted on in a state Assembly or Senate committee.
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