In a recent development that could have significant implications for businesses in Washington state, discussions are underway regarding the fate of unclaimed funds from gift cards. While Washington state law ensures that gift cards do not expire, there has been an ongoing debate about what happens to the revenue generated from unclaimed balances. Unlike some states where these funds are required to be turned over to the government, Washington corporations have been able to retain these profits due to a loophole enacted by state legislators in 2004.
The issue of unclaimed gift card funds has gained attention as concerns have been raised about the fairness and transparency surrounding their treatment. Under the current law, businesses in Washington state can keep the revenue generated from unused or unclaimed gift card balances, which can add up to a significant amount over time. This has prompted discussions about whether businesses should be obligated to surrender these funds to the state.
The issue could be that there is much more money circulating than the state can ignore. At one time corporations were expected to earn about $3 million in unused funds. Now that number is more than $250 million, according to the Federal Security and Exchange Commission.
Proponents of the proposed change argue that unclaimed gift card profits should be redirected to the state, as is the case in many other states. They believe that these funds could be put to good use by the government, benefiting public services or being allocated towards initiatives that support the poor, teachers and children. Sen. Yasmin Trudeau said those funds should be added to the state’s general fund and spent on schools, or affordable housing projects.
On the other hand, opponents of the proposed change express concerns about the potential impact on businesses, particularly smaller establishments. They argue that requiring businesses to surrender unclaimed gift card profits could place an additional burden on their financial resources, potentially affecting their ability to operate and grow. ”Those who we know who have the most gift cards include Starbucks, Nordstrom, REI, and we look forward to engaging with them and others to make sure this is implemented in a way that works for the people of Washington and works for their businesses as well,” said Rep. Emily Alvarado.
