Fort Worth Councilwoman Kathleen Hicks says she is angry that the City Council is considering a zoning-change request by the pawnshop industry that would allow pawnshops to rebuild in the event of a fire or natural disaster.

She says the zoning issue points to a far deeper problem: Many pawnshops also offer payday loans with high interest rates and fees charged to customers.

"People say they provide a much-needed service," Hicks said. "I beg to differ. They prey on people."

The payday loan business in Texas is unregulated, and Hicks says anything that promotes what critics call predatory lending is harmful to her southeast Fort Worth district, where nine of the 16 pawnshops are situated.

Councilman Frank Moss says he brought the issue to the council at the request of Fort Worth-based Cash America International and others that he says he can't remember. He says the issue is about zoning for pawnshops and not about payday loans.

He wants to reverse a 2006 vote that changed the zoning to legal but nonconforming. "We're saying, 'Allow them to be legal conforming,'" he said. Such a change would let them rebuild after a fire or disaster.

Hicks doesn't buy that. She says this is "politics at its very worst" and adds: "They try to divide the issues, but the issue is the same. Most pawnshops have payday-lending-shop operations inside."

The 2006 zoning change was supposed to reduce the number of businesses that have a potential negative impact on nearby neighborhoods. Tattoo and massage parlors were also included. But the revision under consideration mentions nothing about them. To be fair, Hicks says, the council ought to include the other businesses, too.

Moss says he shares Hicks' concern about "anyone who is charging unreasonable interest rates to low-income individuals." But he says that's not what this is about.

Payday loans are usually small loans with high interest taken out by consumers until their next paycheck. Customers are often poor, lack credit cards and are unable to secure low-interest loans at banks or other lending institutions.

Cash America, for example, charges a $20 fee on each $100 borrowed. Customers are allowed to extend the loan up to four times if needed, a process that tacks on more fees. Interest rates, if calculated for an entire year, can reach more than 1,000 percent. But payday lenders say that calculation is unfair because the loans often last for several weeks or less.

State Sen. Wendy Davis, D-Fort Worth, co-sponsored several bills in the Legislature last year that would have imposed regulations on the payday loan industry, but none got out of the Business and Commerce Committee.

During a hearing on Davis' bills last year, Leslie Pettijohn, the state's consumer credit commissioner, testified that no state agency has regulatory oversight of payday lending. According to a summary of the hearing distributed by Davis' office, Pettijohn said: "We don't have any jurisdiction [over complaints]. We often try to pass them to the Attorney General's office. They often try to send them back to us."

At that hearing, Davis recalls, the room was packed with industry lobbyists. Few consumers attended.

"It's the mighty against the weak, and as you can imagine, the mighty are winning out," Davis says.

State law was changed several years ago to allow payday lenders to operate as credit service organizations, which allows them to avoid state lending and usury laws. Because of this, critics say, Texas payday loans are among the most expensive in the nation.

A handful of cities have begun putting restrictions on payday lenders, but Fort Worth does not. Nationally, about 15 states have outlawed payday lenders. Other states have regulations, unlike Texas.

Cash America spends about $30,000 a year on political donations to Texas candidates, estimates Alex Vaughn, the company's vice president of governmental affairs. Cash America's vice president of government relations, William J. White, was appointed by Gov. Rick Perry to chair the Texas Finance Commission, which ensures that banks, savings institutions and consumer credit grantors operate as sound and responsible businesses. White's term expires this month.

Referring to that appointment last year, state Sen. Eliot Shapleigh, D-El Paso, said: "The fox is not in the henhouse. The fox owns the henhouse." Shapleigh introduced several bills with Davis trying to regulate the industry.

Cash America's Vaughn says that because White was appointed as the designated industry representative, it's unfair to paint his position as anything negative.

Predatory lending is an unfair term, Vaughn says, because customers are not forced to do business with payday lenders.

"Our customers are intelligent," he says. "They may not be the best in financial management, but they know the costs and the alternatives."

Last year, legislators estimated that Texas payday lenders annually lend about $2 billion and collect $400 million in fees. But those numbers are difficult to pin down since payday lenders are not required to report their numbers to the state, something one of Davis' bills would have changed.

The Austin-based Center for Public Policy Priorities has estimated that a $500 loan can end up costing a borrower $4,000 if it is not paid back immediately.

As for the Fort Worth zoning proposal, Davis says: "If I were still on the City Council, this is not something I would vote in favor of. But I respect that this is a local decision, and our decision makers are going to make a decision they think is right."

The council discussed the issue last week and will vote on the matter at a future meeting.

Hicks says she fears she is fighting for a lost cause on the local level but yearns for something better statewide: "I hope Sen. Davis has some luck getting stronger legislation against them, because right now there's nothing."

I asked Davis whether she plans to reintroduce her bills next year.

"Absolutely," she replied.