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Commission recommends ban on cashless retail

Wednesday, January 29, 2020 by Ryan Thornton

Human Rights Commissioner Garry Brown noticed recently that more and more businesses across the nation are going cashless in order to make doing business safer, cleaner and more efficient.

But for millions of people without bank accounts or with limited access to banking services – disproportionately people of color and those over 65 – the trend toward cashless business is a serious concern, said Brown.

“I would hope that we’re all for inclusive commerce instead of preferred customers,” Brown said. “It’s one thing for something that costs thousands of dollars like a car, as opposed to maybe a pack of gum; if you go into a 7-Eleven and they’re not going to take a dollar, to me that’s a problem.”

Although there are currently just a few cashless establishments in the city, Brown wants the city to get ahead of the issue before it becomes more common. He brought a recommendation to the commission Monday evening asking City Council to ban cashless business for physical retail establishments with five or more employees.

New York City Council voted last week to ban cashless establishments for similar reasons. Last year, Philadelphia, San Francisco and New Jersey became the first jurisdictions to join the state of Massachusetts in banning cashless retail.

Commissioner Courtney Santana said cashless businesses only make life more difficult for unbanked people who already often lose a percentage of their paychecks through check cashing fees. “Why are we penalizing communities of color and those who don’t have as much as we do?”

Commissioner Nathan White, who is bringing the commission a resolution related to equitable banking access next month, gave his enthusiastic support. “Even though we’re stepping into the business realm, Texas can’t mess with us on it because it’s literally legal tender; it’s printed on the tender that you have to take it.”

The official position of the federal government is that private businesses are free to accept or not accept cash unless state law dictates otherwise. The Federal Reserve defines legal tender as currency valid for all debts, public charges, taxes, and dues, but not necessarily for private goods or services.

Some commissioners voiced concern that the recommendation could be interpreted as having the effect of inhibiting free commerce. Commissioner Isabel Casas said some small local shops may have unique reasons, such as safety, for not wishing to keep a lot of cash on hand.

After reaching out to local cashless enterprise Tiff’s Treats, Santana said safety was not its reason for phasing out cash; it was about following the trend toward electronic and mobile app-based payment systems, she said.

To protect very small and vulnerable local businesses, White made a friendly amendment to exclude businesses with fewer than five employees from the ban. Under this language, the ban would apply to “every physical, public-facing retail establishment with five or more employees.”

Chair Sareta Davis proposed adding language recognizing that under city code some businesses may be legally eligible to an exception to the ban if it is shown to have a disparate impact on their establishment. Brown said the clarification was not necessary and did not accept the amendment.

The recommendation passed unanimously, in a vote of 11-0.

Clarification: Following this report, Tiff’s Treats reached out to the Monitor, directly contradicting what Santana had stated at the commission’s meeting last week. According to a public relations specialist with Tiff’s Treats, company records showed no account that Santana had been in communication with the company’s chief financial officer or other management. The company’s representative also stated that Santana’s claim that the company did not list safety as one of their reasons for going cashless was entirely wrong. Instead, the representative said safety for store employees and delivery drivers is the primary reason that the company chose to do without cash. The Monitor was unable to get in touch with Santana for a follow up on the issue, but the Tiff’s Treats representative claimed the company’s CEO was recently able to connect with Santana to discuss the matter. (This clarification was also published as a whisper on February 4, 2020.)

This story has been corrected. A previous version of the story reported the vote as 10-1. Photo: Mybloodtypeiscoffee [CC BY 4.0].

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