Rent A Center, Rent Way and a significant number of
independent Rent to Own dealers, representing a total of about 4,500 rental
locations in the United States, will form a coalition to continue support of the Consumer
Rental Purchase Agreement Act (Disclosure Bill). Christopher Korst, Rent A Center Senior Vice
President and General Counsel said the as yet un-named group will hold it's
first organizational meeting later this month. Among other things, the Coalition
will plan a Legislative Conference to be held later this year.
According to Korst, the Coalition has no desire to form a competing trade
association, but the companies involved feel an organized effort is necessary due to APRO's (Association of
Progressive Rental Organizations) recent
announcement that the trade association would no longer
actively pursue federal legislation that contains minimum disclosure
requirements - opting instead for a "Definition Bill" stating simply that a rent
to own transaction is a lease. APRO developed the Definition Bill approach after
Rent A Center and Rent Way resigned from the association in October, 2004.
Defining Rent to Own as a transaction separate and apart from retail has always been the
holy grail of legislative efforts at all levels of government. But, say experts,
a bill devoid of consumer protections will be difficult, if not impossible to
Ron Waters, former APRO Director of Legislative Affairs, now an
independent industry lobbyist, said "This has been tried before. The Rental
Purchase Agreement Act started out as a definition bill." Waters
explained that it was Congressional leadership from both sides of the isle
that insisted on the addition of consumer protections such as minimum
disclosure requirements. Waters added that stripping out those consumer
protections will remove Democratic support from the bill and vastly decrease the
likelihood of passage. "Without Democratic support, this bill will not pass," he
Both the Definition Bill supported by APRO and the Disclosure Bill supported by most rent to own dealers since 1985,
have big up-sides.
Business owners involved for years in the effort to bring national consistency to
regulations tell RTO Online that, if passed, APRO's Definition Bill
would be a god-send. But they fear sending mixed signals to Washington.
Jeff Lebaken, owner of Lebaken's Rent to Own in Wisconsin, a state where Rent to
regulated as a credit sale said "It's not about which legislation is better. Two separate tracks
will flip the train." Lebeken believes that one industry supporting two
mutually exclusive pieces
of legislation sends a message that there is a lack of unity.
APRO President Shannon Strunk is adamant in his belief that two separate
efforts by the same industry may actually
improve the odds of favorable legislation. Strunk, APRO Executive Director Bill Keese, and General
Counsel Ed Winn traveled to Washington D.C. last week to gauge opinions on the
Definition Bill strategy. Strunk told RTO Online their objective was 3 fold. "We
specifically went to Washington to make sure our strategy was viable, that it
wouldn't interfere with anything we've done in the past or any other efforts
occurring at the same time. We feel 100 percent certain from the answers we
got that we will not be interfering." Strunk declined to name the
representatives with whom the group met. Instead saying they met with "Seven
offices." He added the meetings included Representatives, Senators and staff.
In an interview Tuesday, Christopher Korst expressed deep concern about the
future of favorable Rent to Own legislation if two separate bills are put
"If the bill [APRO is] proposing had any chance whatsoever of passing, you might
look at this differently, but it doesn't," he said. "What it does have is a significant
likelihood of confusing people on Capitol Hill about what the rent to own
industry really wants." Korst added that a Definition Bill will be viewed as an
attempt to remove consumer protections negotiated by the industry over the past
decade. "For 12 years, we've
all been going to Washington, meeting with [congressional] staffs and coming
4-square behind the the Disclosure Bill that provides benefits to rental dealers
in the form of a definition, and also benefits consumers in the form of
disclosures and other protections," said Korst. He added that trying to
introduce a Definition Bill to a different committee may cause other more
problems. "Both [Chairman] Shelby and [Chairman] Oxley are going to object very
strenuously to any attempt by any part of this industry to end-run their
committee," he said.
The newly formed Coalition expressed a desire to work
together with APRO on legislation. "On a number of occasions we have indicated our desire
to work with APRO on a single bill and not against each other, " said Chris Korst. "I would hope that we can do that the future." As of press time, no such
agreement has been reached.
RTO Online is the official channel for Rent-to-Own Industry News and the
only independent source of news for the rent-to-own, rental-purchase,
lease-purchase trade. RTO Online (Rent to Own Online) represents the choice
of the entire RTO Industry for trusted information, as it happens.
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