If Sen. Barbara Leff has her way, Arizona will join the ranks of about half a dozen other states that regulate fees charged on gift cards.

But while California, Connecticut, Maine, Massachusetts and New Hampshire have rules to limit the fees retailers may charge or when or how expiration dates kick in, Ms. Leff, R-11, wants to make the rules a lot simpler: no fees at all and the balances are good forever.

“If you buy a $50 gift card, it should be good for $50 forever,” said Ms. Leff, chair of the Senate Commerce and Economic Development Committee.

Gift certificates in some form have been a staple of modern retailing for decades, but it’s only been in the last several years that the plastic gift card version has been available. Rather than buying a paper certificate that a gift giver gives to a recipient, the giver instead buys a card with a magnetic stripe on it that has an electronic record of the dollar value. If the recipient uses less than the amount of the card on a visit to the retailer, the remaining balance remains recorded in the data on the magnetic stripe.

More recently, a number of retailers have been charging a “dormancy” fee, typically about $1 to $1.50 a month, although most dormancy fees don’t begin to kick in until the card has been unused for 12 to 24 months. In some cases, owners of gift cards must use the entire balance by a certain period or it expires.

Among the major retailers offering gift cards are Best Buy, Toys R Us, K-B Toys and Kmart. Restaurant and specialty food sellers, including Olive Garden, Red Lobster and Starbucks, also are big gift card sellers.

Bain & Co., a Boston-based commerce consulting and research firm, is anticipating that gift card sales will total as much as $45 billion this year, with that total doubling in just three years.

Cards Have Accounting Costs

Michelle Ahlmer, executive director of the Arizona Retailers Association, said it’s unreasonable to expect retailers don’t incur any expenses in offering gift cards. Most of the fees go to the cost of issuing the cards and keeping track of balances.

John P. Feldman, a Washington, D.C. attorney whose specialties include advertising and marketing, agreed that gift cards have promotional and accounting costs.

He said the efforts of individual states to regulate fees and expiration dates are helping to drive up those costs, because retailers either have to tailor a card to a specific state or not offer them.

Ms. Leff isn’t convinced.

“The retailers are getting the money up front, and have what amounts to an interest-free loan until the balance is used,” Ms. Leff said.

Arizona Attorney General Terry Goddard doesn’t dispute that retailers incur some costs in offering gift cards, so he’s proposing that, rather than eliminate the fees, retailers should be required to do a better job disclosing fees and expiration dates to the buyer and ultimately, to the recipient. —