In an agenda item placed by the City Attorney’s office, the Long Beach City Council approved an ordinance that places a one-year moratorium on “check-cashing facilities” in the Downtown area.  

The wording of the ordinance states that “Residents, Councilmembers and other individuals have expressed concern that the proliferation of ‘check cashing facilities’…have led to, or will lead to, the displacement of full service banking institutions in this locale, making access to traditional banking services difficult for certain economically disadvantaged segments of the City’s population.”

There are many ideological facets to this issue.

For the more conservative, check cashing facilities are an eyesore, but there is obviously a demand for these check cashing facilities amongst Long Beach’s “economically disadvantaged segments.”  If the poor want to take their checks to payday loan establishments, who is to say they can’t?  Val Lerch was a strong proponent of this idea.  

“I don’t think it’s the job of this council to regulate how our community spends their money,” said Lerch, who instead argued for an education program.

For the more liberal (of which the Long Beach City Council is composed of), check cashing facilities cater largely to the poor, and people use these to cash government checks (i.e. welfare/public assistance.  In addition, check cashing sites are also used for undocumented immigrants who receive paychecks, but do not want to, or can’t, open up a checking account at a normal bank.  This is a big constituency for the liberal members of the Council.

On the other hand though, it is part of the ideological debate of the left leaning members of the council to be able to regulate the market, and to direct people where they should or shouldn’t be spending their money.

There are a lot of facets of this check cashing craze, but the largest issue discussed last night was that everybody wants a moratorium in their area, and nobody wants it in their backyard.  Councilmember Schipske raised the concern that when check cashing stores will not be able to set up shop in Downtown, they may look to settle in other parts of the city (hurray for NIMBY/YIMBYism).

The City Council went the more liberal route, voting 5-2 in favor of this moratorium (Lerch and O’Donnell voting no, Uranga and Bonnie Lowenthal not present).