State Street Escheat delay no gift to retailers, critics charge

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A bill giving retailers four more years to collect the ZIP codes of gift card holders — and five years for the state to assume the unused value of those cards — received different responses from business groups.

A bill giving retailers four more years to collect the ZIP codes of gift card holders — and five years for the state to assume the unused value of those cards — received different responses from business groups.

The New Jersey Food Council backed the measure, but the New Jersey Retail Merchants Association opposed it.

Retail Merchants Association President John Holub had backed the bill when it would have stopped state escheatment, the practice of assuming the unused gift-card balances. That position was reversed when negotiations, including with administration officials and legislators, led to the delay, not the repeal, of escheatment.

“It’s been unfortunately turned on its head, and it’s implementing the most onerous provisions of a bill that we sought to repeal,” Holub said.

Food Council President Linda Doherty said in a statement that the bill was a “balanced solution.”
“It turns an onerous gift card law and makes it one of the better escheat policies in the country,” Doherty said.
Treasury spokesman Andrew Pratt pointed out that the bill adds consumer protections, including allowing consumers to receive cash from retailers for card with less than $5 in value remaining, bars card issuers from adding fees after the card is sold and guarantees that consumers can reclaim unspent balances from the state.

“It was designed to be a law that takes into consideration the interests of consumers and the needs of a business community that is still recovering from recession,” Pratt said.

Assemblyman Paul D. Moriarty (D-Turnersville) was originally a sponsor of the bill, but took his name off of the legislation after it was amended. He was the only legislator to vote against it.

“It was completely contrary to what I was advocating for,” Moriarty said. “If you’re the retailers, this bill is better than what was there. But I guess if you’re sentenced to death, then life in prison looks good.”

Moriarty said the changes were about Gov. Chris Christie refusing to admit he was wrong. “This is the governor trying to find an exit strategy to a policy that is a total failure,” Moriarty said. He noted that Christie won’t be in office when escheatment starts, which could take as many as nine years.

“Come on, this is crazy,” Moriarty said. “The governor can never say, hey, this wasn’t a great idea. I mean everybody makes mistakes. Does he think that if anyone admits a mistake, that means they’re a flawed human being? We’re all human beings.”