- Front Porch
MERIDEN — The Greater Meriden Chamber of Commerce and Meriden Economic Development Corp. boards are both upset by the City Council decision to lift the ban on check-cashing businesses.
At a lengthy City Council meeting last week, councilors agreed to allow the service at gas station/convenience stores over 1,500 square feet.
City Councilor Steve Iovanna, who voted against lifting the ban in April, but voted for it last week, said he can see arguments on both sides of the issue, but believes the market should be open to everyone.
“I don’t think we’ll see a proliferation of check-cashing places,” Iovanna said.
But opponents of lifting the ban say adding the service to such establishments does not promote economic development or financial literacy.
“Were residents in an outcry for this service?” asked Sean Moore, president of the chamber and MEDCO.
Only two city businesses currently offer check cashing since they had done it before the ban was in place and were grandfathered in. Now that the ban has been lifted, more businesses can join them.
Moore said the same customers who pay fees for check cashing are likely also paying the same businesses for money orders when there are better options in the community that cost significantly less.
“This is the antithesis of any economic development,” Moore said.
The boards of both the chamber and MEDCO unanimously disagree with lifting the check-cashing ban, Moore said.
Organizations including the Meriden-Wallingford United Way, the Boys and Girls Club and Girls Inc. offer financial literacy programs and discourage people from using check cashing, Moore said. There are even credit unions set up at the high schools that provide free checking, he said.
Moore said he does not understand the motivation behind the councilors who voted for the service and were passionate about making the change. Councilors Brian Daniels, Larue Graham, Bob Williams Jr., Matthew C. Dominello Sr., Iovanna, Walter Shamock and David Lowell voted to lift the ban. Councilors Cathy Battista, Miguel Castro, Daniel Brunet and Kevin Scarpati voted against lifting the ban.
In 2007, the City Council approved a zoning change that blocked the opening of new pawnshops, tattoo parlors and check-cashing businesses.
Earlier this year the owner of the Irving gas station at 978 Broad St. wanted to change zoning regulations to allow check-cashing as an accessory use. The Planning Commission thought the service would be used, said City Planner Dominick Caruso. Under regulations developed by the commission, check-cashing could only be offered as an accessory use at established gas stations/convenience stores over 1,500 feet. Signs for the service could be no more than two feet. Eventually the issue made its way to the City Council in April and councilors denied it, 6 to 4.
But Mayor Michael S. Rohde submitted a new resolution to eliminate the ban on check cashing and allow the service to be offered by any business with fewer restrictions.
The Planning Commission believed stricter regulation was needed, Caruso said.
“No one, including the staff, want it to be totally opened,” he said.
The commission wrote up a recommendation that included the same language as its previous recommendation, Caruso said. The service would be a benefit to the city, but should be limited to gas stations/convenience stores over 1,500 square feet.
The City Council voted on the same resolution last week that was defeated in April, but this time approved lifing the ban.
Shamock, who voted in favor of check cashing, said the vast majority of the state has the service, so why shouldn’t Meriden? He also said the city hasn’t been friendly to small businesses in the past and doesn’t think the city should curtail them from earning a few extra dollars by offering check cashing.
“I don’t see a problem,” Shamock said.
Iovanna said it’s not like a check-cashing business can just open. He said allowing an existing business to add the service isn’t a “horrible idea.”
While Iovanna said he also sees Moore’s point, he said the council can’t legislate financial literacy. He said he can’t make people take out checking accounts.
Rohde said thinks the entire issue is overblown and there’s nothing wrong with offering residents a choice. He said the service is cheaper than ATMs that are located in many businesses and they charge a larger fee.
Tami Christopher, director of Middlesex Community College, Meriden Center, said when she learned about the council opting to lift the ban she was surprised and disappointed.
“I don’t think it promotes positive economic development in the city,” she said.
Christopher teaches a freshman seminar class where she talks about financial literacy. Students learn about banking and the negative aspects of fee-based cash checking. Christopher said the research and findings on the service are easily located online.
“People already had this service available to them in Meriden,” Christopher wrote in a letter to the editor that appeared in Friday’s Record-Journal. “Expanding it sends the wrong message about the kind of community most responsible, civic-minded, tax-paying families in Meriden work so hard to support and encourage.”
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