Sponsors of a Senate bill that would have barred the growing practice of merchants assessing surcharges on debit card transactions pulled the bill yesterday after it was amended to bar all ATM surcharges.

The amendment was added as a so-called poison pill to induce the death of the debit card surcharge ban, according to Tim Dore, chief lobbyist for the CU Association of Colorado, which supported the original measure. “It created a whole political stir,” he told Credit Union Journal yesterday.

The credit union-backed effort comes as merchants all over the country are adding surcharges to their debit card transactions – as much as $3. Credit unions are being called to ask why members’ transactions have added charges on them, according to Dore, who said credit unions in other states are calling Colorado with similar observations.

Once the ATM surcharge ban was added to the bill the sponsors agreed to delay any action on the measure until May 13, the day after the annual legislative session ends.

Colorado law specifically bars surcharges on all credit card transactions, but not on debit card transactions, as the law was written before the proliferation of debit cards. The proposal, which also was backed by the Colorado Bankers Association, would have specifically barred debit card surcharges too.

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