The New Jersey legislature is expected tovote this week on a bill that would amend the law passed in 2010which requires retailers selling gift cards to gather zip codesfrom buyers and escheat unused balances to the state after twoyears.
While Senate Bill 1928 would not eliminate the need to collectdata, it would push out the date of compliance for another fouryears. It would also extend the time at which a card would beconsidered abandoned from two years to five years. The text of thebill can be found here.
While it looks like the bill would make it through the legislature,there is no guarantee that the governor will not veto it. GovernorChris Christie already has expressed an unwillingness to considerthe retailers’ point of view, saying that he was willing to letretailers leave the state rather than consider any changes to thelaw.
Christie may find that retailers leaving is exactly what happens.As part of our annual closed-loop benchmark survey, MercatorAdvisory Group asked retailers if they would stop selling giftcards in New Jersey if the law remained unchanged. Almost twothirds of respondents said that they would stop selling cards inthe state if the law remained unchanged. Companies such as AmericanExpress, and distributors such as InComm and Blackhawk Networkshave already said that they will stop selling cards in NewJersey.
Source:Mercator Advisory Group
Mercator estimates indicate that New Jersey gift card loads byretail customers could total as much as $600 million annually. So,the economic impact could be significant if all these retailerswere to pull out.
While retailers had some input into the drafting of the new law, itremains to be seen how they would react to any change that may beenacted. As legislators, the governor, and lobbyists proceed, theyshould be aware that retailers have plans of their own, and arewatching to see how things turn out.
