Comment: Lawmakers see pool of cash in unspent gift cards

The state’s current law is among the most consumer-friendly in the nation; lawmakers shouldn’t change it.

By Anthony Anton and Rachel Smith / For The Herald

If, like most people, you received a gift card or two this holiday season, would you want the state claiming your unspent balances if you don’t spend them fast enough?

What if the state said that taking gift cards was a way to protect you, that unspent balances would be better used for state programs, and if you wanted your card back, you would need to enter your information into a registry proving your gift card is yours?

This isn’t a punchline to a joke about lawmakers reaching straight into your wallet for cash: This year, lawmakers are proposing to take your unspent gift card after three years — and this plan is gaining momentum.

Current gift card law in Washington is among the most consumer-friendly in the nation — and has been for two decades. In the early 2000s, the Legislature unanimously passed a bill that our Democratic government signed into law guaranteeing that gift cards would never expire, that government would never seize gift card balances as “unclaimed property,” and that there would be no fees to buy or use them.

As a result, gift cards in Washington, like in most states, never lose their value. If you received a home improvement store gift card 15 years ago on your wedding day and found it in your garage yesterday, it can still be used to help pay for your teenager’s room makeover project tomorrow.

This is one reason that gift card use has exploded in popularity over time. Gift cards were the top gift among consumers every single year from 2006 to 2020, according to surveys by the National Retail Federation. In 2023, gift cards were second only to clothing as the most popular gift of the year, with 44% of consumers naming them as their gift of choice.

If gift cards weren’t appealing to consumers, consumers wouldn’t purchase them; to the tune of about $30 billion in total spending this year nationwide. “It is undoubtedly this sizable figure that most interests legislators who want to impose a de facto expiration date on your gift cards, classify unspent gift card balances as “abandoned” after this expiration date, and require the creation of a registry in order for consumers to reclaim them.

But this proposed change to state law would require consumers to provide personal contact information to the state when they receive a gift card — something that lawmakers must understand consumers are extremely uninterested in and are unlikely to do — resulting in gift card balances simply staying with the state as new revenue.

The proposal is further confusing to consumers because states commonly use unclaimed property laws to safeguard abandoned property and reunite it with its owners. Legally, they may not use these laws for the sole purpose of seizing abandoned property from its owners and using it as windfall revenue. And, objectively, states can’t do both: it’s not possible to seize a $50 gift card balance and both return it to its owner and use it to pay for public programs.

During this short session, we hope legislators will not spend their time and energy focused on proposals that are solutions in search of problems, and instead focus on what is on the doorsteps of all of our communities: fentanyl overdosing, organized retail theft and critical transportation projects — including a ferry system on the brink — with soaring price tags. All of these items need Olympia’s attention a lot more than your gift cards.

Don’t let anyone make decisions about the gifts you give or receive or tell you that you’d be better protected if your gift cards were taken from you to serve the public interest.

Lawmakers should set this legislation aside and let it expire; unlike gift cards in Washington.

Anthony Anton is president and CEO of the Washington Hospitality Association. Rachel Smith is president and CEO of the Seattle Metropolitan Chamber of Commerce.

This commentary originally appeared in The Seattle Times.

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