Can DC Bars Refuse To Accept Cash?

In Hospitality, Legislation by Richard Bianco

This is a confusing issue for bars and restaurant owners, that I have received a number of questions on. That is due in no small part to the extensive, but incomplete coverage of the Cashless Retailer’s Prohibition Act of 2020. The short answer is YES, owner’s can refuse to accept cash, for now.

This is how we get there. The Council passed the Act in December 2020. It became law after the requisite Congressional review period on March 16, 2021. The Act prohibits any retailer from refusing to accept cash, posting signs stating such a policy, or charging more for cash transactions. Although previous iterations of the law considered by the Council did not include bars/restaurants, this one does. The only exceptions are parking garages, internet retailers, and businesses that have a free, on-site cash converting device.

Although the law was approved in March 2021, by its express terms did take effect until the end of the Public Health Emergency. That happened in July. So now, months later, why is the prohibition not in effect?

It’s not apparent from the text of the law, but the Council approved it, subject to a subsequent a budget appropriation, which would pay the cost to actually enforce the law. According to the Council Committee Report, it will cost approximately $170,000 per year to implement. Unless and until the funds are made available to implement the law bars and restaurants can maintain cashless policies.

The “subject to appropriation” is an often used but rarely publicized legislative mechanism which allows the Council to reap the positive PR benefits of passing a high profile or popular law, but, which they do not have to go through the trouble of implementing. Such political gamesmanship makes compliance obligations unclear.

The law itself is far from perfect. By declaring cashless policies to be “unfair trade practices,” under the Consumer Protection Procedures Act, it opens up owners to potentially severe $5,000 per day fines for each day that a non-compliant policy is in place. That underscores the necessity for clear messaging to all retailers about what, and perhaps more importantly, when businesses must comply.

If you have any questions about the Cashless Retailer Prohibition Act or other regulatory compliance issues for bars and restaurants, I invite you to call us for assistance or use our online scheduling tool to set up an appointment.