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House raises merchant returned-check service charge after debated amendment
Summary
After floor debate and amendments, the House passed HB 2-56 adjusting the service charge a merchant may assess on dishonored checks; debate included anecdotal consumer experiences and questions about bank/collection practices and whether the increase reduces overall consumer costs.
The Utah House debated and passed House Bill 2-56 on Feb. 22, 1995, a measure that adjusts the merchant service charge permitted for dishonored checks. Members discussed a committee amendment, merchants' processing costs, consumer impacts, and whether banks and collection agencies should be required to resubmit checks before referral to collectors.
Floor discussion included anecdotal testimony about returned-check charges. Representative Atkinson described a personal experience where bounced checks led to multiple charges from banks and collectors and asked how the bill would address such situations; the sponsor explained the bill addresses the merchant's recoupment, not bank overdraft fees. Representatives urged consideration of whether merchants should be required to resubmit checks before referring them to collection agencies, and the sponsor said the groups involved had pledged to investigate bank and code changes and, if feasible, return with further legislation.
The House adopted an amendment that reverted a committee increase and clarified the dollar amount language in line with the original bill and then voted the bill out of the House. The clerk announced the passage with a roll-call tally recorded on the floor.
Next steps: HB 2-56 will be transmitted to the Senate for consideration. Members asked retail and banking stakeholders to continue work on processing and resubmission procedures to reduce hardship on isolated consumers.
