Good news for Oregonians who get state assistance on the Reliacard

Last Spring we let you all know about what we thought was a big problem - unemployed Oregonians unable to easily access their money without major fees. Treasurer Westlund's office met with us to discuss the concerns we had with the state's ReliaCard program, and decided to re-open the contract.

Good news for any Oregonian who gets state assistance on the ReliaCard - you can now withdraw your money from your account, without paying fees, every week instead of just twice a month. This is a big win for the most vulnerable in our state. Check out the details in Treasurer Westlund's press release:

FOR IMMEDIATE RELEASE
Sept. 17, 2009
Contact: James Sinks 503-508-0737 (cell) James.Sinks@state.or.us

State Treasury negotiates better deal for Oregonians to lower fees for state-issued ‘stored value’ bankcards Reloadable bank cards increase convenience, save taxpayers millions, and reduce fraud

SALEM – Oregonians who receive child support, unemployment payments and state employee payroll via state-issued bank cards can save more money and gain added convenience, thanks to a new contract negotiated by the Oregon State Treasury.

As of Sept. 1, holders of the “stored value” cards issued through a program implemented at the Oregon State Treasury are able to withdraw money for free four times a month, twice from bank tellers and twice from automated teller machines (ATMs).

The previous contract allowed for a total of two free cash withdrawals monthly from either a bank teller or ATM.

In addition, money on the cards can still be tapped for free an unlimited number of times from grocery stores and other venues that accept Visa-branded debit cards, using the “cash back” option after a sale.

As a result, holders of the stored value cards have the ability to access funds on the card a number of ways without paying any fees.

“Every Oregonian will benefit,” said State Treasurer Ben Westlund. “People who are receiving payments will pay less in fees or nothing at all, and the State and taxpayers will continue to benefit from the cost-saving efficiencies of electronic banking.”

Those benefits include reduced postage costs because checks no longer need to be printed and mailed, which also translates to reduced opportunities for check fraud. The Oregon Employment Department has saved more than $5 million in check processing costs since implementing the card program in 2007.

As another benefit, the system will continue to protect vulnerable people who lack conventional banking services. In the past, those individuals were forced to go to expensive check-cashing establishments or similar services to get access to their money.

The 2007 Legislature reformed the payday lending industry in Oregon, but the revised rules still allow businesses to charge check-cashing fees that start at $5 per check. So, without the stored value cards, a person with no bank account and weekly checks could expect to pay a minimum of $20 a month just to get their money. (A schedule of allowable check-cashing fees is at http://dfcs.oregon.gov/checkcashing/maxfees.html)

If Oregonians have bank accounts, they can sign up for free direct deposit of their payments directly to their accounts. If they do not elect to use direct deposit, they are given a reloadable stored-value card that is used like a debit card. Payments are regularly credited to those cards.

The Oregon State Treasury, reacting to the request from labor union leaders including the Oregon AFL-CIO that cardholders get more free withdrawals, reopened negotiations with U.S. Bank about the Oregon cards.

“Treasurer Westlund is going to bat for Oregon workers,” said Tom Chamberlain, president of the Oregon AFL-CIO. “People who are receiving jobless benefits and child support will benefit from being better able to access their money without cumbersome fees. These changes help the most vulnerable in our state at a time when more and more families find themselves needing a little help to get by.”

The reloadable cards also help to increase financial literacy because they give people without bank accounts a way to get more comfortable with bank cards -- and to understand the conveniences and responsibilities that accompany them.

As of August 2009, there were more than 327,000 active stored value cards in this program, which is defined as cards that have been issued and had activity in the previous 90 days. Of those, more than 265,000 were issued by the Oregon Employment Department, almost 60,000 are from the Department of Justice for child support payments and 325 are from Oregon State Payroll for state employees.

In 2003, 23 percent of state payments were made electronically. In 2009, through August, that figure stands at 75 percent.

As was the case in the previous contract, cardholders also can check their balances an unlimited number of times for free. There are fees for people who use ATMs or bank tellers more than the monthly allowance of allowed two times apiece, for a total of four. Also, a cardholder can incur overdraft fees if he or she uses the card at a location that does not obtain a prior approval, and that transaction exceeds the balance on the card.

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