Legislature(2007 - 2008)BELTZ 211
03/22/2007 09:00 AM Senate STATE AFFAIRS
| Audio | Topic |
|---|---|
| Start | |
| HB117 | |
| SB92 | |
| SB115 | |
| SB16 | |
| SB33 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | SB 16 | TELECONFERENCED | |
| + | HB 117 | TELECONFERENCED | |
| += | SB 33 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| = | SB 92 | ||
| = | SB 115 | ||
SB 115-GIFT CARDS
9:13:28 AM
CHAIR MCGUIRE announced the consideration of SB 115. There is a
concern in combining the term "certificate" with "gift card" and
so there should be a definition of both in the bill. There also
was a question about the value of a gift card remaining into
perpetuity or not.
9:14:57 AM
MARIT VAN DORT, Staff to Senator McGuire, said leaving the value
in perpetuity strikes a nice balance between providing consumer
protection and giving business owners the choice of issuing gift
cards. Alaska is making money off of the unclaimed property, and
there is no reason to limit it. She said Rachel Lewis noted that
the law isn't being changed; gift cards are just being added.
Instead of going through the Attorney General's office, a person
can go to the Department of Revenue website and get the value of
a gift card back if it has been reported as unclaimed property.
If someone held a gift card for a long time and the business had
not recorded it as unclaimed property, the person with the gift
card can tell the business to honor it or threaten to report the
business to the Department of Revenue.
9:17:24 AM
CHAIR MCGUIRE said a business is required to report an aggregate
of $750 worth of unclaimed property. The bill doesn't change
that, but it includes gift cards. Whether a consumer buys a gift
card or a product, "the business can choose, at that point in
time, to calculate it for however they want into their profit
statements. Later, if they decide, put it off the books and
three years later report it as unclaimed property." If the
business has reached an aggregate $750, it is required to report
the unclaimed property, giving the consumer the right to get
that money back. "I think that's a really nice consumer
protection to have in Alaska." She noted elderly consumers, and
"somebody has given their money toward that gift to you, so it
still ought to have a value." This is a nationwide movement, she
noted. The bill also eliminates fees and interest. Merchants
have no obligation to issue gift cards, she said, but she
believes they will because of the money they can make from them.
9:19:54 AM
SENATOR GREEN said one store has racks of cards from different
venders, so either the store receives a cut from selling the
card or it must add a fee.
MS. VAN DORT said unless the gift card is issued from a bank,
the fees will not be allowed.
SENATOR FRENCH said Carrs has $50 Nordstrom gift certificates,
so there must be an agreement that Nordstrom gets $48 of those
dollars, for example, and Carrs gets $2.
CHAIR MCGUIRE said the two companies can make those
arrangements, but the consumer won't be required to pay more.
"So when you buy the $50 card at the checkout stand, you get 50
bucks worth of merchandise. What happens between Nordstrom and
Carrs is not impacted by this."
9:21:40 AM
SENATOR GREEN said right now a person will pay about $6.50 in
fees for a $150 gift card.
CHAIR MCGUIRE said the merchants will have to make that
decision. She offered that it has been extremely valuable for
Nordstrom and others to make gift cards available. She got a
card and got the full value, she added, but the bill is
necessary because of an increasing trend to tack on fees that
the consumer pays.
9:23:10 AM
SENATOR GREEN said the businesses should be alerted in case they
want to testify. Gift cards are convenient, she stated.
CHAIR MCGUIRE suggested reaching out to Carrs and Kroger and
having them come and talk about the gift card structures.
9:24:21 AM
MS. VAN DORT said gift certificates are defined in statute under
gift cards, "so we cannot add gift certificate in there because
we would have two terms meaning the same thing."
CHAIR MCGUIRE said the committee sees the gift card and gift
certificate differently, although they do the same thing.
TERRY BANNISTER, Attorney, Legislative Affairs, said a different
term, like "gift device", could be used to cover certificates
and cards, but right now gift card is the main definition and it
is used throughout the bill. Adding gift certificate, "we would
have a separate term being used, but gift card covers it." The
title uses the term gift certificate because "we're affecting
gift certificates; we're changing the names and all that, and
that's why I was trying to be very careful to say: oh, we're
talking about gift certificates to the extent that we're kind of
replacing the terminology with gift cards. So we wanted to
notify everybody that we were addressing this." She said on page
1, line 5, the section title should be corrected to read gift
card and credit memos, and that could be done by the revisor.
"Whenever we delete something or change a term we try to
evaluate whether or not we need to alert people to tell them
that this has been affected."
9:27:04 AM
CHAIR MCGUIRE said prior to this bill, gift certificate was
defined and not gift card. "So now the question is whether you
define them both separately, or whether you replace the term
gift certificate with gift card, or whether we call it a gift
device."
SENATOR STEVENS asked how it differs from a credit memo, and he
gave an example of selling something to a second-hand store in
return for credit in the store.
MS. BANNISTER said she will have to check the uniform act to see
how credit memo is defined. She assumes that wouldn't fit, but
it could be included under gift card. It seems to be a totally
different item, she stated. "It is not affected by the bill;
we've left it as it is."
9:29:24 AM
SENATOR BUNDE said there is no simple issue that we can't
convolute. The bill is focused on the new phenomena of gift
cards, "and I would say that gift certificate is a distinction
that doesn't make a difference." He said, "Go ahead with the
card," which is electronic and is used like a credit card. Some
merchants charge a fee for using a credit card, he noted.
CHAIR MCGUIRE said her inclination is to keep the bill as is,
but also to make the technical change. She offered Amendment 1,
as follows:
Page 1, line 5:
Delete "certificates"
Insert "cards"
Hearing no objection, Amendment 1 carried.
9:31:08 AM
SENATOR GREEN said she doesn't see where a gift certificate is
defined under gift card. It looks like it only applies to gift
cards, she stated.
MS. BANNISTER said gift card is a broad definition, and it means
a device-any kind of device. It could be a certificate. By its
terms, the gift card definition includes gift certificates.
SENATOR FRENCH said line 26 defines the device as including an
electronic card but doesn't say it could be a hand-written piece
of paper issued by a store.
MS. BANNISTER said, "You may want to do that." The language uses
the term "includes," so it is not limited to an electronic card.
9:33:17 AM
CHAIR MCGUIRE suggested the following: includes a paper
certificate or an electronic card.
9:34:20 AM
CHAIR MCGUIRE asked about any other material that a certificate
could be written on besides paper. "Should we just say
certificate?" There may be another kind of material, and she
noted a business card made out of metal.
SENATOR FRENCH said he liked using the term "paper."
MS. BANNISTER said since the language starts with "includes," it
does not exclude a metal certificate.
CHAIR MCGUIRE offered Amendment 2, as follows:
Page 2, line 26, following "includes":
Insert "a paper certificate or"
Hearing no objection, Amendment 2 carried.
SENATOR FRENCH moved SB 115, as amended, from committee with
individual recommendations and the attached zero fiscal note.
There being no objection, CSSB 115(STA) moved from the Senate
State Affairs Committee.
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