How should I respond to panhandlers asking for money?

What are the better ways to respond to panhandlers? I live and work in a downtown area, and am often asked by strangers on the street for money. These requests vary in form from the brief but honest ("Spare some change?") to the manipulative and dishonest. My stock response is to say that I have no cash, which is almost always true, but somewhat dishonest in that my lack of cash is not my main reason for refusing to give. Explaining my real reasons -- I don't know who this person is, I don't know how he will spend the money, and I don't think giving people money helps reduce their reliance on handouts in the future -- seems overly harsh on someone who is obviously having a rough time of it already, and takes a long time to boot. I feel like I should acknowledge the request somehow, but I want to effectively disengage from the situation as quickly and safely as possible. Is my stock response inappropriate because it is dishonest? Would it matter if I claimed to have no cash on those rare occasions when I am in fact carrying cash? If I shouldn't be using my stock response, what can I say to quickly and safely disengage? Also, I get a lot of dubious stories about being stranded downtown without bus fare. I've often thought about carrying a few valid, single-use transit tickets with which to respond to such stories. It's something I can afford, and it would in theory limit how my charity gets used. Would this be a wise or safe course of action?