7 On Your Side helps couple get gift card balance back in cash

SAN RAFAEL, Calif. (KGO) -- Millions of us received gift cards for the holidays, but research shows nearly $1 billion worth of them go unused every year.

Some of that money is stuck on cards that are only partially used.

7 On Your Side's Michael Finney has a tip for how to get more out of those gift cards.

How often does this happen to you -- you use a gift card but it still has a couple dollars left on it.

We can only guess most consumers throw it in a drawer, forget about it, lose it, or toss it out.

Don't do it -- by law you can redeem those cards for cash.

Spencer Seidler shows us pictures of the little Christmas village his girlfriend Marina made by hand. "She's crafty and likes to do little projects," he said.

They bought everything they needed at Michaels Arts and Crafts in San Rafael. Marina says she learned a lot about glitter, glue and also about consumer rights.

"We were checking out, her card was saying like $30," Spencer said.

The couple used a $30 Michaels gift card to buy the materials. After they paid, the card still had $1.53 left on it.

"So I asked the lady, hey, can we just get that $1.53 back as cash and she just straight up looked at me and she goes no we don't do that," Seidler said.

He told the clerk that state law requires retailers to give cash back on store gift cards worth less than $10 - that's to make sure consumers don't lose that leftover money.

Couldn't she check with her manager? "She looked at me and said I've asked my manager for cash back on gift cards and she always says no. And I was shocked at this point," he said.

Spencer and Marina left the store. It was just a small amount after all, but it bothered Spencer. "It's the principle," he said. "Suppose there's 10,000 people who have gift cards and everybody leaves a dollar or two on there. It's, you know, a lot of profits going to companies and people not being able to use their own money."

He contacted 7 On Your Side. We asked Michaels why it didn't refund the money. Right away, a manager called Spencer to apologize, telling us: "We are aware of the gift card law in California and have trained new hires and existing employees. Unfortunately, this incident was contrary to our company's policy and inconsistent with our statewide training. We are conducting an internal investigation to determine why Mr. Seidler was told he could not redeem the balance."

You can get cash back if the balance is under $10. California is one of 11 states that allow you to redeem low balance cards, but California's $10 threshold is highest of all.

As for that leftover $1.50? Spencer says they ended up using it after all for more paint.

Click here for a look at more stories by Michael Finney and 7 On Your Side.

Written and produced by Renee Koury.