For Immediate Release
AUGUSTA - State Rep. Kerri Prescott has proposed legislation to amend Maine's gift card laws to relieve businesses of what she calls an "accounting nightmare."
LD 247, the bill by Rep. Prescott (R-Topsham), would remove the requirement that a merchant must remit 60 percent of a card's unclaimed amount to the state treasurer after two years of inactivity.
The proposal would change from two years to five years the time after which a gift card is deemed abandoned, but as discussions about the bill have evolved, an expansion to 10 years is under consideration. There also is discussion about the complete repeal of the requirement to remit part of the remaining value of a gift card, a practice known as escheatment.
"This bill looks to correct a law that unfairly hurts Maine businesses," Rep. Prescott said on March 3, testifying before the Joint Standing Committee on Judiciary. "Right now, Maine retailers, restaurants, inns and bed-and-breakfasts sell gift cards to their customers. Maine has a law stating that gift cards and gift certificates can never expire. However, if that gift card is not redeemed within two years, or after a two-year lapse in usage, the merchant has to send 60 percent of the unused value of the card to the State of Maine."
Rep. Prescott said the laws regulating abandoned property regarding gift cards pose an "accounting nightmare" for businesses. "Consider the impact on our local economy of tracking who uses gift cards and who does not," she told the committee. "This bill gives this committee an opportunity to help eliminate an unnecessary and burdensome regulation on Maine businesses. Let's allow business to be between the consumer and the business without government getting in the way."
Rep. Prescott said that because the law only applies to Maine-based businesses, not those based in other states, its impact is especially unfair. "Reny's, Kittery Trading Post and local restaurants are sending this money to the state, and that's just not right," she said. "The national businesses that have locations in Maine but are headquartered elsewhere comply with the laws in the state where they are based. This has created an expensive, unlevel playing field for Maine businesses."
The bill, titled "An Act to Amend the Gift Card Laws," has bipartisan support, with nine co-sponsors. Rep. Prescott, a third-term legislator, is the House chair of the Committee on Labor, Commerce, Research and Economic Development.
Maine House Republicans
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