NJ Could Get Direct Savings Through Direct Deposit [AUDIO]
Call it New Jersey government's version of looking under the seat cushions for loose change.
Assembly lawmakers are pushing a bill that would require all state workers to use direct deposit for their state paychecks. The legislation sailed through the Assembly unanimously in June, but stalled in the State Senate amid concerns for employees without bank accounts.
"When I heard the concerns of the Senators regarding the impact on folks without bank accounts I realized that during our Budget hearings we heard about a solution to this very concern - that the Department of Labor had already implemented," says Assemblyman Declan O'Scanlon, one of the bill's sponsors. "During the hearings Commissioner (Hal) Wirths spoke about a paperless program they implemented for recipients of unemployment and disability benefits. I made a mental note then that their system could be the solution to obstacles to going paperless for state employees."
Assemblyman Ruben Ramos is the measure's prime sponsor.
He says, "This common sense measure brings the State into the 21st century. We simply cannot afford the administrative costs associated with mailing checks when there are more efficient alternatives."
The paperless effort is already underway in the Department of Labor, where paper checks are no longer issued to recipients of unemployment or disability.
Since moving to the paperless format, the Department of Labor has received no complaints from recipients. Those workers without bank accounts can receive their checks on debit cards which are usable anywhere.
"The option of a debit card allows everyone to go paperless and protects those employees without bank accounts from being unduly burdened," explains Ramos. "This blueprint can work for our bill without having to change the language of the legislation."
O'Scanlon says, "I am confident that not only will this program work but that it will become a model for other states considering similar programs. This bill promotes efficiency and affordability while allowing employees without bank accounts to go paperless. It's a win-win."
A fiscal analysis of the bill by the non-partisan Office of Legislative services estimates that by 2015 the state could save over half-a-million dollars a year by requiring direct deposit. It may be a cliche, but it's also true; the lawmakers feel every little bit helps.
"It starts off small," explains Ramos. "We can make it permissive for all of the counties, municipalities and boards of education, then you're talking millions of dollars across the State of New Jersey."