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The Retail Advocate

The Retail EmployerDecember 2007

News

Who speaks for your business's legislative needs? New organization helps Virginia retailers

Here’s good news for Virginia retailers: The Retail Merchants Association (RMA) and the Retail Alliance (RA) have created a new legislative arm. The Virginia Retail Federation LLC (VRF) will serve independent, franchise, regional and national retailers throughout Virginia.

Historically, the RMA has served Greater Richmond, and the Retail Alliance has served Greater Hampton Roads. Now the RMA and the RA are geographically expanding their coverage areas to serve all of Virginia’s retailers. Read more >>

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Local Issues

False Alarm Ordinance Amendments

City of Richmond proposes amendments to its False Alarm Ordinance. For a copy of the draft ordinance call Adrian Edmondson at 662-5500.

Amendments to Henrico County Sign Ordinance

The Henrico County Board of Supervisors approved amendments to the Counties' sign ordinance at their November 27th Board meeting. The amended ordinance will allow for additional signage within regional shopping centers. Click here for the approved ordinance.

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State Issues

2008 General Assembly Pre-filed Legislation

If you have any questions concerning the pre-filed legislation call George Peyton at 662-5505.

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Federal Issues*

* © 2007. NRF Enterprises, Inc. used with permission.

Wisconsin next up in smoke ban debates

A ban on smoking in Minnesota's bars and restaurants started Oct. 1 and has affected local businesses, according to some bar owners. With Illinois' ban going into effect Jan. 1, Wisconsin's border establishments have become somewhat of a haven for smokers -- but with that state considering a ban, it might not last long. USA TODAY (12/9)

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Nevada smoking ban creates confusion

In the year since the passage of the Nevada Clean Indoor Air Act, which bans smoking in many businesses that sell food, restaurants and taverns have been working out ways to follow the law without losing customers. Some establishments are getting around the no-ashtray aspect of the law by using substitutions such as shooter glasses, and some are separating their food and drinking businesses. The rules have proven to be so confusing that law enforcement officers have admitted to being unsure how to enforce them. Los Angeles Times (free registration) (11/19)

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N.J. debates allowing increased retail alcohol licenses

New Jersey legislators on Monday heard arguments surrounding a bill that would allow more convenience stores and supermarkets to carry liquor, wine and beer in the state, but did not vote on the measure. The Senate committee didn't indicate whether the bill, which is supported by several supermarkets, would be discussed again before the legislative session ends Jan. 8. The Star-Ledger (Newark, N.J.) (12/4)

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Fifteen states mull over trans fats bans

Fifteen states are considering legislation that would ban or restrict trans fats, but none of the bills have been passed into law so far this year. The National Restaurant Association says it is not against phasing out trans fats but disagrees with bills that include "inflexible bans with unrealistic timetables." The New York Times/Associated Press (11/27)

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White House plans to rework stance on illegal hires

The Bush administration is temporarily backing off a push to enforce new rules punishing firms for hiring illegal immigrants, papers filed last week in federal court indicate. The motion asks a federal district court judge to suspend the case until late March to allow the Department of Homeland Security to rework the rule and further study its possible impact on small business. The White House said it believes the amended rule would "fully address the court's concerns." The New York Times (11/25)

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SSA won't send no-match advisories until 2008

The Social Security Administration has decided not to send any letters this year advising employers of discrepancies in employees' SSA data. Mark Hinkle, a spokesman for the agency, says the SSA could resume sending the legally permissible notices next spring. Nation's Restaurant News (free registration) (11/15)

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Lawyers: SSA decision not to send no-match letters is temporary

Immigration lawyers are saying that the Social Security Administration's decision to not send mandated no-match letters to employers in 2007 is likely just a delay. The decision "at least gives restaurant owners a brief reprieve," said Carolyn Richmond, an attorney with Fox Rothschild. "We're not sure, but it is off at least until the spring. That is the best we can tell." FastCasual.com (11/19)

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Consumer Reports Calls Unused Gift Cards 'Easy Money' for Retailers

Consumer Reports magazine caused concern among retailers who sell gift cards this week when it ran a full-page ad in the New York Times claiming that unused gift cards amount to "easy money" for retailers.

"Dear Shopper," the ad in Tuesday’s paper said. "Last year, shoppers like you were out $8 billion because of unused, lost or expired gift cards. Easy money for retailers. Lost money for you. Yours truly, Consumer Reports."

The ad then urged readers to visit the magazine’s web site, www.consumerreports.org, where an article headlined "Avoid Gift Card Pitfalls" described the cards as "loaded with fees, expiration dates and other hassles."

The article cited a survey conducted by the Consumer Reports National Research Center that found 27 percent of those who received a gift card in 2006 had not used them either because they had forgotten about them, lost them, didn’t have time to shop, couldn’t find anything to buy or the cards had expired. The article cited a report from Boston-area research firm TowerGroup that estimated the value of unused gift cards at $8 billion for 2006, or about 10 percent of the $80 billion in gift cards sold last year.

Despite the emphasis on retailers in the ad, the article made a distinction between gift cards issued by retailers and those issued by banks, saying bank-issued cards "often saddle recipients with fees, expiration dates, and other gotchas. Retail cards generally aren’t as troublesome but some of them lose value or expire if you don’t use them quickly, depending on laws and regulations in your state." Unlike bank-issued cards, there is usually no charge to buy a retail gift card "because retailers make their money not on the cards themselves but on the products and services that customers buy with them," the magazine said.

NRF was nonetheless concerned by the image painted by the ad, and proactively worked through the news media to clarify that retailers don’t see a windfall from unused gift cards.

"We agree with Consumer Reports—consumers need to redeem those gift cards," NRF Vice President for Industry Public Relations Scott Krugman said during a live interview on CNBC. "Here’s where we disagree: they’re saying that money left on the table by consumers is going into retailers’ pockets. They know nothing could be further from the truth. The fact of the matter is a retailer doesn’t count the sale of a gift card until it is actually redeemed for merchandise."

The ad ran the same day NRF released its annual survey on gift card spending during the holiday season, which found consumers plan to purchase $26.3 billion in gift cards this November and December, up 6 percent from last year.

In addition to a news release on the results of the gift card spending survey, NRF issued a fact sheet explaining how gift cards working and offering tips for consumers buying cards. Among other facts, the document noted that 92 percent of the nation’s top retailers no longer have expiration dates or dormancy fees associated with gift cards, and that accounting rules don’t allow retailers to count gift cards as a sale until they are redeemed. Among other tips, NRF has long urged consumers to understand individual retailers’ policies before buying cards.

Like Consumer Reports, NRF urges consumers to spend gift cards quickly. Aside from any expiration dates imposed by retailers or banks, some states apply "abandoned property" laws to gift cards, claiming the money for the state treasury if cards go unused for as little as two to three years.

For more information, contact NRF Vice President and Government and Industry Relations Counsel Maureen Riehl at (202) 626-8121.

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New York moves to collect Internet sales tax

Under a new policy supported by New York Gov. Eliot Spitzer, e-commerce retailers such as Amazon.com will be required to collect sales tax on all purchases made from New York state. E-retailers must follow the same standard that the U.S. Supreme Court set for mail-order vendors and are required only to collect sales tax on purchases in states where they have a physical presence. New York is claiming that commonly used affiliate programs give companies like Amazon.com a legal physical presence in their state. The New York Sun (11/14)

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