New pawn shop rule revision could allow expansions in Rock Hill

03/23/2014 9:26 PM

03/23/2014 9:28 PM

New regulations proposed for pawn shops in Rock Hill could include an exception for existing pawn shops to expand during the next two years without being held to the new standards.

The Rock Hill City Council is expected to consider final approval of the new pawn shop regulations on Monday night. The proposed rules, which the council initially approved in February, will look slightly different for the second vote.

Council members have already agreed to grandfather in existing Rock Hill pawn shops to the new standards, which create stricter rules on where pawn shops can open in the city. The new rules group pawn shops with other businesses such as title loan and payday lending, debt collection and other small loan companies –– a move city officials say is needed to cut down on the number of alternative lending establishments in Rock Hill.

On Monday, the council will be asked to consider a provision in the new standards that would give Rock Hill’s five existing pawn shops up to one year to obtain necessary permits to build an expansion. After that, the shops would have up to one more year to complete construction.

Without the expansion provision, existing shops would still be allowed to stay open without following the new rules, as long as the business never closes for more than a six-month period.

But, the expansion provision will help Rock Hill business owners like Blake Teague of Teague’s Pawn on Cherry Road.

The Teague family has operated the shop for more than 20 years. After saving money for years, they bought a piece of land next to their pawn shop for a future expansion.

When city leaders signed off on new pawn shop regulations last month, the Teagues were concerned that the expansion plan could be in jeopardy.

If the City Council approves the expansion provision, Blake Teague said, he’ll be able to start and finish his expansion within two years. Since introducing the new pawn shop rules, city officials have been in touch with him and have been “fair” in offering to adjust the proposed rules to allow for existing businesses to expand, he said.

The new regulations include:

• A location restriction that prevents new pawn shops from operating within 300 feet of churches, homes, schools and public parks.
• A rule to keep new pawn shops from opening within 1,000 feet of other pawn shops or alternative lending companies such as title loan and payday lending businesses or debt collection companies.
• A requirement that new pawn shops only locate in “multi-tenant” retail areas of at least 30,000 square feet –– such as shopping centers –– or locate inside large businesses, such as grocery stores. This rule will keep stand-alone pawn shops from opening.

Heavy N.C. regulations push businesses south

While the new pawn shop rules easily earned City Council members’ favor last month, one Planning Commission member expressed concerns about the regulations during a meeting about two weeks ago.

While the new limits on pawn shops may curb the rapid growth of alternative lending companies in Rock Hill, commission member Jeff Greene said, “I think we have so many because our residents are using them and they’re profitable.”

City records show 53 businesses classify as alternative financial services. Nearly half of those are congregated on Cherry Road. Rock Hill officials have said that the city is seeing a spillover of alternative financial businesses because the industry is heavily-regulated by state laws in North Carolina.

Greene also took issue with the regulations singling out some types of businesses, saying, “We don’t limit gas stations; we don’t limit other businesses.”

The Planning Commission signed off on the new rules, with Greene dissenting. Monday’s council vote could give final approval to a pending ordinance already in effect in Rock Hill.

The pending ordinance has allowed Rock Hill employees for the past month to refuse issuing permits for new pawn shops that don’t meet the new rules.

When City Council members took up the issue in February, they were told the pending ordinance was needed to keep some interested business owners from opening new pawn shops in Rock Hill. Two of the interested business owners were considering Cherry Road locations –– one of which is now occupied by Nova’s Bakery. A third was looking at opening a pawn shop on Saluda Street.

When The Herald contacted two prospective pawn shop owners, they declined to comment.

Planning Commission members were told earlier this month that one future pawn shop owner had already began a “formal process” in seeking city approvals to open. That pawn shop, officials say, will not have to follow Rock Hill’s new regulations.

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