Legislative Alert: WA H 2095 and WA S 5988 Introduced

This is to advise that the State of Washington has introduced companion bills addressing unclaimed gift cards.  House Bill 2095 and Senate Bill 5988 were prefiled on January 3, 2024, and January 4, 2023, respectively, and both were introduced on January 8, 2024. The bills seek to remove the gift card exemption from Washington’s Unclaimed Property Law.  In the preamble to both bills, the legislature states that removing the exemption for gift certificates “will reduce the incentive for large companies to adopt predatory or deceptive practices regarding gift certificate usage.”

Specifically, the changes to the unclaimed property law in these bills are as follows:

1. The definition of “Gift Certificate” is amended to include certificates that store or allow customers to earn loyalty points.
2. Gift certificates are added to the definition of “Property” and removed from the list of property types not included in the definition of “Property.”
3. Loyalty cards and gift certificates are removed from the definitions of “Stored Value Card” and “Virtual Currency.”
4. A definition of “Loyalty Points” is added and is defined to mean “a benefit to a consumer without direct monetary consideration under an award, reward, benefit, loyalty, incentive, rebate, or promotional program that may be used or redeemed only to obtain goods or services or a discount on goods or services.”
5. A new presumption of abandonment provision is added for Gift Certificates.  Gift certificates are presumed abandoned three years after becoming payable or distributable.
6. The net value of a gift certificate at the time of abandonment is the reportable amount.
7. Gift certificates for goods or services from paid membership programs which costs at least $50 annually are exempt from reporting.
8. Holders with a total revenue from the prior fiscal year of $100,000,000 or less are exempt from reporting gift certificates.
9. For all property, the threshold property value for sending due diligence is reduced from $75 to $50.

If enacted, the new law would apply to gift certificates issued or reloaded with funds on or after July 1, 2024.