February 20, 2015
The proposal, which is being circulated by Rep. Jeremy Thiesfeldt of Fond du Lac and Sen. Stephen Nass of Whitewater, would set the interest rate on small claims awards at 12 percent a year. Currently, the interest rate on small claims awards is a much lower combination of 1 percent plus the prime rate at the time of the court award. The prime lending rate, which is generally a low interest rate used by financial institutions for short- and medium-term loans, was 3.25 percent at this writing.
But Thiesfeldt said in an email asking legislators to support the proposal that the current low interest rate, which was signed into law in 2011, hurts small businesses, landlords, counties and collection agencies because “the cost is now shifted from the debtor to the business or individual that was the victim of the crime. Current law gives scofflaws no incentive to settle their outstanding debts in a timely manner.”
Small claims court cases involve monetary disputes of $10,000 or less, often between small businesses and customers, or landlords and tenants. Interest is tacked on small claims awards from the time the court judgment is rendered until it is paid by the defendant.
The proposal is likely to draw support from business and apartment owners and operators, which contributed about $749,000 to all current GOP legislators, who control the legislature, including $4,540 to Thiesfeldt and $2,050 to Nass, between 2011 and July 2014.
Thiesfeldt’s top business interest contributors were insurance agent Ronald Schmitz, and his wife, Susan, of Fond du Lac, who contributed $1,450; Stephen Victor, of Fond du Lac, president of Fedco Electronics, $500; and Marysue Michels, of Brownsville, an employee at Rob’s Riverwood Salon and Spa, $500.
Nass’s top business interest contributors were Robert Westmont, of Madison, owner of Modern Specialty, $500; Mark Stinebrink, of Lake Geneva, owner of Lake Geneva Foods, $250; and Brian Knox, of Fort Atkinson, owner of W.D. Hoard & Sons, $250.