Mandatory Cash Acceptance Update – Philadelphia Legislation & Athletic Venues
On March 18, the Governor of New Jersey signed a bill making his state just the second to require that certain businesses accept cash as a form of payment. DWT has previously detailed this bill, as well as pending legislation in a number of American cities that would likewise require retailers to accept cash. Since our previous post, Philadelphia has become the first major U.S. city to protect cash payments by law. Despite this growing trend, however, not all cities appear to be poised to pass such legislation.
Philadelphia’s new law includes some slight deviations from New Jersey’s model. For example, retailers selling to customers through a membership model like Costco do not fall within the scope of the legislation. Additionally, retailers where credit card holds are required for incidentals, such as rental-car companies and hotels, will not be required to accept cash (ironically, a 1984 Pennsylvania law was passed to protect unbanked consumers from this very practice – the Cash Consumer Protection Act reads, “it shall be unlawful for any person to refuse to rent or sell property or services to any individual for the reason that the individual does not possess a credit card”). To the benefit of several large e-commerce retailers, Philadelphia’s law also exempts “transactions at retail stores selling consumer goods exclusively through a membership model that requires payment by means of an affiliated mobile device application.”
Disregarding the national swing toward mandatory cash acceptance, as of March 10, the Mercedes Benz Stadium located in Atlanta only accepts credit cards, debit cards, and mobile payments. To address the significant concern of serving the unbanked and underbanked (a dominant argument of supporters of requiring cash acceptance), the stadium will have approximately ten machines that will exchange cash for a prepaid debit card. Similarly, Tropicana Field located in Tampa Bay has announced that it will become a cash free stadium as of the beginning of the Major League Baseball season this spring. Tropicana Field plans to allow patrons to exchange cash at various retails locations in the stadium and through roaming gift-card vendors. These large venues’ rollouts of cashless policies, while still attempting to accommodate those who prefer to use cash or who do not have access to credit or debit cards, are suggestive that these cities will not be introducing legislation in the near future that requires the acceptance of cash.
The above being said, Philadelphia and New Jersey passed such legislation despite concern from influential retailers, and New York City is actively considering legislation despite many significant and popular restaurants in the city that have gone cashless (many restaurants in the Danny Meyer/Union Square Hospitality Group portfolio, and the restaurants Sweetgreen, Dig Inn, Dos Toros, and Tender Greens, to name a few). Additionally, a number of chambers of commerce, retail federations, and even governmental officials have expressed concern about the budding mandatory cash acceptance trend. While the mayor’s office in Philadelphia pointed to poverty levels in the city as reason to sign the bill, a senior official in Philadelphia’s commerce department, lamenting the cashless ban, told the Wall Street Journal that “[m]odernization is going to happen with or without Philadelphia, and we want to be part of it.”
DWT will continue to monitor developments in this space with regard to ongoing legislative activities and industry trends, including the use of kiosks and machines to exchange cash for prepaid cards at athletic venues or otherwise.