Initiated Measure 21


Last week the Brennan Rock & Roll Academy in Sioux Falls announced that it would close its doors before Christmas. A letter from their board of directors said passage of a ballot initiative capping payday lending interest loans impacted the decision. The board added that the majority of donations to the nonprofit music academy came from Dollar Loan Center and, without that sort of funding, the nonprofit would have to be dissolved.

Steve Hildebrand, owner of Josiah's Coffee Shop in downtown Sioux Falls, has paired up with Steve Hickey to gather signatures for Initiated Measure 21 which caps payday lending rates in South Dakota at 36%. Hildebrand is a Democrat who worked on President Obama's campaign. Hickey is a Republican.

From Amendment U to Initiated Measure 21, Hildebrand discussed his thoughts on controlling the payday lending industry and deception in the ballot questions during his visit on Dakota Midday.

South Dakota Legislative Research Council

Two out of ten ballot measures up for vote in South Dakota deal with interest rates. Constitutional Amendment U establishes an 18 percent cap on interest rates in the state.

But there’s a catch.


According to the Attorney General’s explanation, if constitutional amendment U is passed any agreement with a lender may not charge more than 18 percent interest per year. That is if it’s a verbal agreement.

According to Consumer Credit Counseling of the Black Hills, if a loan isn’t agreed to in writing, it didn’t happen.

Kealey Bultena / SDPB

Two out of ten ballot measures up for vote in South Dakota deal with interest rates. Initiated Measure 21 caps interest rates at 36 percent.

Opponents of the measure say that cap would choke the industry.


A coalition of South Dakota churches and concerned citizens are backing a proposal to cap interest rates at 36 percent. Supporters say it would rope in payday loan companies that charge upwards of 500 percent on short term loans.