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Story Archives: 'They want their check'
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|'They want their check'|
Late last year, the Louisiana Department of Revenue began distributing debit cards to individuals who are owed money from the state instead of utilizing the long-held practice of mailing them a check.
Individuals who are owed state income tax refunds are the primary recipients of the debit cards. Anyone who is due a refund of $6,999 or less, get's a debit card. Refunds of $7,000 or more are paid the old fashioned way, or with a check.
Administered by Chase Bank, the debit cards are called MyRefund cards. Chase Bank doesn't make money on providing the debit cards to the Department of Revenue to distribute, but the bank can make a little something – let's call it the juice or the vig – on interest income on balances on the cards. That's seems only fair since Chase Bank doesn't get paid for providing the debit cards to the state.
It makes you wonder, though. How much money does Chase Bank expect to earn in interest income collected on tax refunds that belong to Louisiana income tax payers? How much money will Chase Bank collect in swipe fees and ATM fees?
Better yet, how was Chase Bank awarded the deal to provide the debit cards to the Department of Revenue? Was it a no-bid contract? Did the Department of Revenue properly advertise for bids so banks from throughout Louisiana could compete for the debit card business?
Those are fair questions that need to be answered.
According to a state official, the Department of Revenue moved to distributing debit cards in lieu of checks because it's less expensive than printing and distributing checks. I suppose kudos are in order to the Department of Revenue for getting creative in seeking ways to save taxpayer dollars.
But apparently there exists some Louisianians who don't much care for those debit cards, and they've let their state representatives know it. We know that to be true thanks to comments that surfaced Monday during a hearing of the House Appropriations Committee.
Even the committee's chairman, Rep. Jim Fannin, expressed his displeasure with the debit cards.
"It's a gimmick in my mind, and I'm troubled with the gimmick," said Fannin, D-Jonesboro.
Rep. Roy Burrell, D-Shreveport, said some folks who received the debit cards in the mail threw them in the trash. Apparently Burrell's constituents were confused, thinking the debit cards represented offers from credit card companies.
Rep. Patricia Smith, D-Baton Rouge, suggested that income tax filers were being charged exorbitant fees to use the debit cards, specifically at ATMs that don't belong to Chase Bank. Imagine that. A bank wants to get paid for providing a service to an individual who uses a product that originated at a competitor bank.
Yet, perhaps Rep. James Armes, D-Leesville, appropriately captured the mood of income tax filers when he said, "They want their check."
Don't we all.