LEGISLATIVE FISCAL ESTIMATE
[First Reprint]
ASSEMBLY, No. 1211
STATE OF NEW JERSEY
221st LEGISLATURE
DATED: MARCH 24, 2025
SUMMARY
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Synopsis: |
Upgrades criminal penalties for use or possession of payment card scanning device; requires merchant to take reasonable safety measures to prevent scanning of payment card. |
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Type of Impact: |
Annual State expenditure and revenue increases; annual local expenditure increase. |
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Agencies Affected: |
Department of Law and Public Safety; County Prosecutors; the Judiciary; Office of the Public Defender; Department of Corrections; State Parole Board.
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Fiscal Impact |
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State Cost Increase |
Indeterminate |
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State Revenue Increase |
Indeterminate |
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Local Cost Increase |
Indeterminate |
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· The Office of Legislative Services (OLS) projects that the bill will result in indeterminate additional annual costs to the State because the bill upgrades criminal penalties for the use or possession of payment card scanning devices. The OLS does not have sufficient information on the potential increases in the number of convictions and terms of imprisonment resulting from the bill’s provisions and therefore is unable to estimate the costs to the State.
· The following State and local agencies would incur caseload and expenditure increases: a) the Department of Law and Public Safety may have to provide guidance and other information related to the bill’s provisions; b) county prosecutors would have to prosecute additional cases if the increased penalties create a reluctance on the part of the defendant to enter a guilty plea; c) the Judiciary would have to adjudicate additional cases; d) the Office of the Public Defender may have to represent additional low-income criminal defendants; e) the Department of Corrections would have to house more inmates for longer terms of imprisonment; and f) the State Parole Board would have to supervise the return to society of additional convicts.
· The State may receive indeterminate additional annual revenue from fines and penalties imposed on and collected from individuals convicted of the upgraded offenses and from other monetary penalties; however, the State’s ability to collect fines and penalties has historically been limited.
· The bill may result in increased one-time costs to the Division of Consumer Affairs in the Department of Law and Public Safety for its additional administrative responsibilities. Depending on the division’s resource allocation policies, the added workload may or may not augment State administrative expenditures.
BILL DESCRIPTION
This bill upgrades the criminal penalties for the use and possession of a scanning device and requires merchants to take reasonable safety measures to prevent payment card scanning.
The use of a scanning device, with the intent to defraud, is currently a crime of the third degree, but the bill provides that it is to be a crime of the second degree if a subsequent offense results in a theft of at least $50,000 or if the first offense and the subsequent offense results in a combined total theft of at least $50,000. A crime of the second degree is punishable by a term of imprisonment of five to 10 years, a fine of up to $150,000, or both.
The possession of a scanning device, with the intent to commit an unlawful act, is currently a crime of the fourth degree, but the bill provides that it is a crime of the third degree for a second or subsequent offense. A crime of the third degree is punishable by a term of imprisonment of three to five years, a fine of up to $15,000, or both.
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Assembly Bill No. 1211 |
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Current Penalty |
New Penalty |
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· The use of a scanning device, with the intent to defraud, is a crime of the third degree.
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· The use of a scanning device, with the intent to defraud, is a crime of the third degree; however, it is to be a crime of the second degree if a subsequent offense results in a theft of at least $50,000 or if the first offense and the subsequent offense result in a combined total theft of at least $50,000. |
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· The possession of a scanning device, with the intent to commit an unlawful act, is a crime of the fourth degree. |
· The possession of a scanning device, with the intent to commit an unlawful act, is a crime of the fourth degree for a first offense; however, it is to be a crime of the third degree for a second or subsequent offense. |
In addition, this bill requires merchants that accept payment cards to implement reasonable safety measures to prevent the use of scanning devices at any payment terminal in accordance with rules and regulations adopted by the Division of Consumer Affairs in the Department of Law and Public Safety. Under the bill, the division is required to 1) create rules and regulations to effectuate the provisions of this bill, including certain security measures for merchants, and 2) provide direction and oversight to merchants on complying with the provisions of this bill and for the development and distribution of informational materials regarding best practices that merchants are to implement to prevent the use of scanning devices.
FISCAL ANALYSIS
EXECUTIVE BRANCH
None received.
OFFICE OF LEGISLATIVE SERVICES
The OLS projects that the bill will result in indeterminate additional annual costs to the State because the bill upgrades criminal penalties for the use or possession of payment card scanning devices. The OLS does not have sufficient information on the potential increases in the number of convictions and terms of imprisonment resulting from the bill’s provisions and therefore is unable to estimate the costs to the State. Crimes of the second degree carry a presumption of incarceration for persons convicted of these crimes while, generally, a presumption of non-incarceration applies to first time offenders of crimes of the third degree and fourth degree.
The following State and local agencies would incur caseload and expenditure increases: a) the Department of Law and Public Safety may have to provide guidance and other information related to the bill’s provisions; b) county prosecutors would have to prosecute additional cases if the increased penalties create a reluctance on the part of the defendant to enter a guilty plea; c) the Judiciary would have to adjudicate additional cases; d) the Office of the Public Defender may have to represent additional low-income criminal defendants; e) the Department of Corrections would have to house more inmates for longer terms of imprisonment; and f) the State Parole Board would have to supervise the return to society of additional convicts. To the extent that the bill results in additional incarcerations, or incarcerations for longer periods of time, costs will increase for the Department of Corrections. Based on information provided by the department, the FY 2024 average annual cost for housing, ensuring security, and providing services to an incarcerated individual was $75,254, with an average marginal cost of housing one additional incarcerated person, accounting for food, clothes and wages, of $11.39.
The bill may result in increased one-time costs to the Division of Consumer Affairs in the Department of Law and Public Safety for its additional administrative responsibilities. Depending on the division’s resource allocation policies, the added workload may or may not augment State administrative expenditures.
The State may receive indeterminate additional annual revenue from regular and enhanced fines and penalties imposed on and collected from individuals convicted of the upgraded offenses and from other monetary penalties; however, the State’s ability to collect fines and penalties has historically been limited. The OLS notes that under the Consumer Fraud Act, an unlawful practice is punishable by a monetary penalty of not more than $10,000 for a first offense and not more than $20,000 for any subsequent offense. In addition, a violation can result in a cease and desist order issued by the Office of the Attorney General, the assessment of punitive damages, and the awarding of treble damages and costs to the injured.
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Section: |
Law and Public Safety |
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Analyst: |
Lead Fiscal Analyst |
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Approved: |
Thomas Koenig Legislative Budget and Finance Officer |
This legislative fiscal estimate has been produced by the Office of Legislative Services due to the failure of the Executive Branch to respond to our request for a fiscal note.
This fiscal estimate has been prepared pursuant to P.L.1980, c.67 (C.52:13B-6 et seq.).