newjerseynewsroom.com

BY BOB HOLT

NEWJERSEYNEWSROOM.COM

Going out for an Easter dinner with your American Express gift card? It might be the last time you are able to do so, at least in New Jersey.

A New Jersey law enacted about two years ago allows the state to take any balance of gift cards not redeemed two years after their initial purchase, but retailers say complying would be too much expense and trouble.

As a result, American Express has taken their gift cards out of New Jersey retailers, and other companies are threatening to do the same.

According to an Associated Press report on Businessweek, New Jersey’s unclaimed property law requires gift card sellers to get zip codes from buyers so the state can claim any unused value after two years. Without the zip codes, the unused card goes back to the selling company or to the state where that company is headquartered.

New Jersey was looking at the unused gift card balances, along with travelers' checks and money orders to provide $79 million in added revenue for the 2011 fiscal year. Retailers sued the state about the law, and the case is now pending.

New Jersey Retail Merchants Association president Jon Holub said retailers are concerned about the expense and administrative processes involved in creating technology to track the buyer and amount of money left on each card, and reporting it to the state every year, according to NorthJersey.com.

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According to an Associated Press report in the Washington Post, the only way for New Jersey residents to buy American Express gift cards is directly from the company. An injunction against the collection of zip code information was lifted last month.

Holub expressed concerns about the potential “domino effect” among retailers if they are required to collect the zip code information.

Gov. Chris Christie says he is trying to close an $11 billion budget gap.