An apparatus is provided and includes a rotary encoder that comprises a stator, a rotor, and a controller. The stator has an opening adapted to surround a first portion of a rotatable shaft, a transmit region, and a receive region. The rotor has an opening adapted to surround a second portion of the rotatable shaft, an annular conductive region, and at least one conductor electrically coupled with the annular conductive region. The controller has an input coupled to the receive region and has an output coupled to the transmit region. The controller is configured to transmit a first signal on the output of the controller and to the transmit region of the stator, receive a second signal on the input of the controller and from the receive region of the stator, and determine, based on the second signal, a proximity of the at least one conductor to the receive region.