California – BOE No Cash Pilot Program

SALT Report 2507 – The California State Board of Equalization released a copy of an informal issue paper that was distributed prior to a 2012 meeting in which the BOE discussed their plans to implement a “no cash” policy in all BOE district offices. The BOE stated that “a no-cash environment is not only the business trend of the future, but increases safety of both taxpayers and staff.”

In 2012, the BOE was operating a no cash policy on a trial basis in three district offices located in Oakland, Ventura, and San Diego. The pilot program ran for 90 days. However, due to the program’s success the no cash policy remains in effect at those offices and the BOE has expanded the no cash program to six additional district offices.

No Cash Pilot Program

During the 90 day pilot program, the three district offices that participated kept a log of all in-office payment transactions. The log detailed the number of people who attempted to use cash, the amount who ultimately paid using an alternative method, and those that left without making a payment.

If a taxpayer attempted to pay with cash the cashier would request that they pay with a credit card, a personal check, or a business check using a self-service kiosk. If a taxpayer was unable to pay using one of those methods, the cashier would provided them with directions to local businesses where they could purchase a cashier’s check or money order.

Feedback

The BOE claims that the feedback they received from the district personnel indicated that they were pleased with the program and wanted the program extended indefinitely. The office managers stated that the no cash policy increased efficiency by reducing the taxpayer’s wait time at a cashiering window. They also stated that there were fewer overages and shortages, as errors could be easily traced back to the payment. From the taxpayer’s point of view, the BOE stated that of the 12,000 taxpayers that came to the pilot offices, only 0.6% stated that they were unsatisfied with the program.

Economic Impact

If the no cash program is implemented statewide, the amount of staff that would be required to handle cashiering services could be reduced. The BOE stated that 10 full time cashiers could be transitioned to various full time collections positions. This could potentially increase their annual collections revenue by $2.2 million. Additionally, the BOE spends on average $80,000 per year for armored car services. By eliminating cash payments, the armored car services could be discontinued, which would result in additional savings.

The meeting that was held on May 31, 2012 resulted in the BOE determining the methods they would utilize to further study the no-cash program prior to implementing it statewide.

For Further Information

California State Board of Equalization – 2012 Informal Issue Paper, No Cash Policy

BOE Sales Tax Field Office Locations & Addresses

BOE 2010 Field Office of the Future Update