D.C. Alters Youths' Pay Method
Monday, June 16, 2008
More than 19,000 young people are set to begin working in the D.C. summer jobs program today, and this time city officials say they've figured out a way to be sure they get paid.
The city has instituted a Visa debit card system to help eliminate payday problems and reduce the fees that have arisen in the past, officials said.
But the new cards, while also offering greater purchasing convenience, will still carry a costly risk if workers are not careful about when and where they draw down their money.
Last year, instead of debit cards, the city issued electronic benefit transfer cards to summer workers. There were fees every time there was an ATM withdrawal, and many ATMs wouldn't accept the cards. At the start of last summer's program, nearly 600 workers couldn't access their wages.
City officials hope the new system will be glitch-free.
"There were just problems that would come up periodically" with the old system, said Lasana K. Mack, the city's deputy chief financial officer and treasurer.
This year, participants will receive their biweekly pay on a Visa debit card, which will bear their name and can be used to withdraw cash from ATMs or to make purchases wherever Visa cards are accepted, Mack said. No bank accounts will be necessary, nor will summer workers have to pay check-cashing fees, as some had to do in the past.
There also won't be any weekly maintenance fees or charges for store purchases.
The workers will also receive financial literacy training, according to Diana Johnson, a spokeswoman for the D.C. Department of Employment Services.
The electronic benefit transfer card "just doesn't give you the advantage of being able to buy something anywhere like the new Visa cards," Mack said. "They'll be able to access their account online, too."
But some ATM fees are still possible. Students can use the cards, which are issued by JPMorgan Chase, on the Allpoint ATM network to withdraw cash without any fees once each biweekly pay period, Mack said. For additional withdrawals, they will be charged the standard ATM fee.
ATMs outside the Allpoint network will also charge a fee.