THE GIVE (AND TAKE) OF CARDS.

Byline: Sherri Buri McDonald The Register-Guard

CORRECTION (ran 12/19/2006): A front page story on Monday had incorrect information about gift cards at Gateway Mall in Springfield. During the holiday season, the mall is waiving the $2 per card purchase fee for businesses placing large orders. Individuals still pay the $2 fee.

With just a week left to shop before Christmas, gift cards that can be spent at shopping malls, stores and restaurants are looking more and more tantalizing as last-minute gifts.

In fact, those little bits of plastic will be the most popular gift this holiday season, with 66 percent of consumers planning to buy them, according to Deloitte's 2006 Annual Holiday Survey.

The National Retail Federation projects that gift card sales will hit nearly $25 billion this holiday season, up $6 billion over last season.

And why not? They're versatile, convenient and much easier to deliver than a bulky package.

"I'd rather get (people) something they would use," said Danielle Roberts, an 18-year-old Eugene resident who has purchased three gift cards to give as holiday presents. "They can get what they want instead of what I think they might want."

But the cards aren't all alike, and although many issuers have made their cards more consumer-friendly, some still come with fees and expiration dates that can diminish the card's value by the time the recipient is ready to spend it.

When people are spreading holiday cheer in the form of gift cards, they're probably not thinking about the $8 billion that research firm TowerGroup estimates consumers lose each year because of unredeemed, expired or lost gift cards.

To help separate the naughty gift cards from the nice ones, the Office of Consumer Protection of Montgomery County, Md., has published a gift card report for the past four years.

This year, the report analyzed 40 cards issued by retailers or restaurants and 10 issued by banks, and found that most retail cards have improved their policies, while the bank cards "have some anti-consumer fees and hocus-pocus' by claiming that the card never expires, despite charging a "dormancy" fee that can draw down the value of the card if it isn't used, said Eric Friedman, the office's acting director.

Out of the 40 retail cards Friedman's office studied, only two with stores in the Eugene-Springfield area - Blockbuster Video and Macy's - have an expiration date.

Other gift cards not included in the report have expiration dates, so make sure to ask when a card is purchased.

Twenty of the retail cards examined in the report stood out by offering the potential for replacement if lost or stolen, had the ability to be used online, and had no fees or expiration dates. Those with stores in the Eugene-Springfield area are Abercrombie and Fitch, Best Buy, Borders Books, Circuit City, Costco, the Gap, J.C. Penney, Kohl's, McDonald's, Old Navy, PetSmart, Sears, Starbucks, Target and Wal-Mart.

The bank cards, however, were a different story. All of them charged a fee at purchase, from $2 to $9.95, and expired - some as quickly as after six months. Nine out of the 10 bank cards deducted a monthly maintenance fee of $2 to $4.95 a month.

The fees led Consumer Reports magazine to advise consumers to consider giving a check instead of a gift card.

Some consumers are choosing to go that route to give the recipient the most flexibility possible.

"I'm giving money instead (of gift cards)," said Theresa Lamb, a shopper from Springfield. "That way they don't have to spend it at one store."

More details about the cards analyzed in the report can be found online at montgomery countymd.gov/consumer.

The office launched its report on gift cards because "it was a growing trend," Friedman said. "It was a huge segment of our marketplace, and it was rife with confusion, problems and possibly deception to consumers."

He figures that media exposure and the fear of federal regulation has helped "force the industry to clean itself up."

A third category of cards not covered by the report are those issued by shopping malls, which offer the advantage of being accepted by multiple retailers.

Locally, Valley River Center in Eugene and Gateway Mall in Springfield offer mall gift cards, which come with long lists of "terms and conditions" in small print. The Fifth Street Public Market and Oakway Center will issue gift certificates, which work like a check when presented to their retailers.

Valley River charges $2 to purchase its US Bank Visa-branded debit card. Merchants that accept Visa will accept the card, including those outside the mall, marketing manager Diana Bray said. In the 13th month after purchase, US Bank starts deducting a monthly $2 administrative fee.

But "the majority of people spend the card within six months of purchase," she said.

Gateway's General Growth Property gift card is issued by American Express. It is accepted by retailers that accept American Express. The mall is waiving the $2 purchase fee this holiday season, mall manager Ron Glover said.

Like Valley River's card, Gateway's card charges a monthly $2 service fee in the 13th month after purchase.

"We encourage you to use your GGP gift card soon," the issuer urges in its terms and conditions.

Both cards require the consumer to keep track of the available funds left on the card, either by checking with the mall office, online, by phone or by swiping the card into a reader at the mall. If the amount of the purchase exceeds the available funds on the card, the transaction will be declined. A consumer must know the exact amount left on the card to ask a merchant to "split payment," using the remaining funds on the card, plus some other form of payment.

Both malls report rising sales of their gift cards. Glover said Gateway is seeing a double-digit increase this year. Valley River is running 27 percent over last year's card sales, Bray said.

"We sell 500 to 600 a day, as opposed to 50 to 60 a day during the nonholiday season," she said. "Almost half of our entire sales volume of the cards for the year is in the month of December."

Last year, the mall rang up $70,000 to $80,000 in gift card sales on Dec. 23, "and we think the 23rd will be the biggest day again this year," Bray said.