Committee advances bill changing merchant-surcharge notice threshold after debate over cap

The Government Oversight Committee advanced House Bill 30 41 on a unanimous 19-0 vote after extended debate over how the state should treat merchant surcharges for card transactions.

Sponsor Floor Leader Josh West told the panel the bill is intended to let retailers recoup processing charges and fix a date in statute; an amendment he submitted also added an emergency clause. "Last year, we ran a piece of legislation that capped a surcharge on retailers at 2 percent," he said, adding the amendment would allow businesses to "recoup what they're being charged."

Members pressed on whether the measure changes existing law in ways that would let credit-card processors increase fees that get passed on to customers. Chairman Stegall clarified the statute at issue: retailers already may recover 100% of processing fees, but the law permits a 2 percent surcharge to appear on receipts without additional posted notice. "The cap has to do with where that notification is posted," Stegall said, explaining that raising the statutory threshold affects when a merchant must present an itemized line on the receipt.

Lawmakers discussed several numeric options for a cap — 3 percent, 3.5 percent and 4 percent — and debated enforceability and consumer impact. Representative Fugate warned that language changing "lesser" to "greater" in the statute could unintentionally allow very high processor charges to be passed through; after members read the proposed on-the-fly amendment aloud, Representative LePak withdrew it so staff could refine the wording ahead of floor consideration. "Rather than do something on the fly... leader West will get with staff and get the details worked out," the chair said.

The committee adopted the emergency clause and then approved the bill as amended, with Clerk recorded as declaring the vote 19 aye, 0 nay. The sponsor thanked the committee and said he would refine the statutory language before the bill reaches the full House.

What's next: Sponsor staff will redraft the disputed statutory phrasing and return the corrected language on the House floor. No final cap level was adopted in committee.