2007 Legislation
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SENATE BILL NO. 1098 – Unclaimed property/funds/distribute

SENATE BILL NO. 1098

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Bill Status



S1098......................................................by STATE AFFAIRS
UNCLAIMED PROPERTY - Amends existing law to require that property from an
estate with no heirs or other claimants shall be paid to the Public School
Permanent Endowment Fund; to provide for distribution of funds received as
unclaimed dividends and interest paid by Idaho corporations to the Public
School Permanent Endowment Fund; to provide for recapture from the Public
School Earnings Reserve Fund if certain circumstances occur; and to require
that property from an estate in which an heir or claimant cannot be found
shall, after approximately five years, be paid to the Public School
Permanent Endowment Fund.
                                                                        
02/07    Senate intro - 1st rdg - to printing
02/08    Rpt prt - to St Aff
02/20    Rpt out - rec d/p - to 2nd rdg
02/21    2nd rdg - to 3rd rdg
02/26    3rd rdg - PASSED - 35-0-0
      AYES -- Andreason, Bair, Bastian, Bilyeu, Broadsword, Burkett,
      Cameron, Coiner, Corder, Darrington, Davis, Fulcher, Gannon, Geddes,
      Goedde, Hammond, Heinrich, Hill, Jorgenson, Kelly, Keough, Langhorst,
      Little, Lodge, Malepeai, McGee, McKague, McKenzie, Pearce,
      Richardson, Schroeder, Siddoway, Stegner, Stennett, Werk
      NAYS -- None
      Absent and excused -- None
    Floor Sponsor - Little
    Title apvd - to House
02/27    House intro - 1st rdg - to St Aff
03/07    Rpt out - rec d/p - to 2nd rdg
03/08    2nd rdg - to 3rd rdg
03/12    3rd rdg - PASSED - 58-7-5
      AYES -- Anderson, Andrus, Bayer, Bedke, Bilbao, Black, Block, Bock,
      Boe, Bolz, Brackett, Bradford, Chadderdon, Chavez, Chew, Collins,
      Crane, Durst, Edmunson, Eskridge, Henbest, Henderson, Jaquet, Killen,
      King, Kren, Labrador, Lake, LeFavour, Loertscher, Luker, Marriott,
      Mathews, McGeachin, Mortimer, Moyle, Nielsen, Nonini, Pasley-Stuart,
      Patrick, Pence, Ringo, Roberts, Ruchti, Rusche, Sayler, Schaefer,
      Shepherd(2), Shirley, Shively, Smith(30), Smith(24), Snodgrass,
      Thayn, Trail, Wills, Wood(27), Mr. Speaker
      NAYS -- Barrett, Hagedorn, Hart, Harwood, Shepherd(8), Vander Woude,
      Wood(35)
      Absent and excused -- Bell, Clark, Raybould, Ring, Stevenson
    Floor Sponsor - Black
    Title apvd - to Senate
03/13    To enrol
03/14    Rpt enrol - Pres signed - Sp signed
03/15    To Governor
03/20    Governor signed
         Session Law Chapter 97
         Effective: 07/01/07

Bill Text


                                                                        
                                                                        
  ]]]]              LEGISLATURE OF THE STATE OF IDAHO             ]]]]
 Fifty-ninth Legislature                   First Regular Session - 2007
                                                                        
                                                                        
                                       IN THE SENATE
                                                                        
                                    SENATE BILL NO. 1098
                                                                        
                                 BY STATE AFFAIRS COMMITTEE
                                                                        
  1                                        AN ACT
  2    RELATING TO ESCHEATED AND UNCLAIMED PROPERTY; AMENDING SECTION  14-113,  IDAHO
  3        CODE,  TO  REQUIRE  THAT  PROPERTY  FROM  AN ESTATE WITH NO HEIRS OR OTHER
  4        CLAIMANTS SHALL BE PAID TO THE PUBLIC  SCHOOL  PERMANENT  ENDOWMENT  FUND;
  5        AMENDING  SECTION  14-522,  IDAHO CODE, TO PROVIDE A CORRECT CODE CITATION
  6        AND TO CORRECT CODIFIER'S ERRORS; AMENDING SECTION 14-523, IDAHO CODE,  TO
  7        PROVIDE FOR DISTRIBUTION OF FUNDS RECEIVED FROM UNCLAIMED SHARES AND DIVI-
  8        DENDS OF IDAHO CORPORATIONS TO THE PUBLIC SCHOOL PERMANENT ENDOWMENT FUND,
  9        TO  PROVIDE  FOR RECAPTURE FROM THE PUBLIC SCHOOL EARNINGS RESERVE FUND IF
 10        CERTAIN CIRCUMSTANCES OCCUR AND TO MAKE TECHNICAL CORRECTIONS; AND  AMEND-
 11        ING  SECTION 15-3-914, IDAHO CODE, TO REQUIRE THAT PROPERTY FROM AN ESTATE
 12        IN WHICH AN HEIR OR CLAIMANT CANNOT BE FOUND  SHALL,  AFTER  APPROXIMATELY
 13        FIVE  YEARS,  BE PAID TO THE PUBLIC SCHOOL PERMANENT ENDOWMENT FUND AND TO
 14        MAKE TECHNICAL CORRECTIONS.
                                                                        
 15    Be It Enacted by the Legislature of the State of Idaho:
                                                                        
 16        SECTION 1.  That Section 14-113, Idaho Code, be, and the  same  is  hereby
 17    amended to read as follows:
                                                                        
 18        14-113.  UNCLAIMED  MONEYS  --  PAYMENT  INTO STATE TREASURY PUBLIC SCHOOL
 19    PERMANENT ENDOWMENT FUND -- ESCHEAT. After a final settlement of  the  affairs
 20    of  any  estate, if there be no heirs or other claimants thereof, the adminis-
 21    trator must pay into the state tax commission any and all moneys  and  effects
 22    reported  as unclaimed property as required by section 14-517, Idaho Code, and
 23    the procedure for distribution of abandoned property outlined in the unclaimed
 24    property act shall be followed which shall accrue and be  transferred  to  the
 25    public  school permanent endowment fund created pursuant to section 4, article
 26    IX, of the constitution of the state of Idaho.
                                                                        
 27        SECTION 2.  That Section 14-522, Idaho Code, be, and the  same  is  hereby
 28    amended to read as follows:
                                                                        
 29        14-522.  PUBLIC  SALE OF ABANDONED PROPERTY. (1) The administrator, within
 30    three (3) years after the receipt of abandoned property, shall sell it to  the
 31    highest  bidder at public sale in whatever city affords in the judgment of the
 32    administrator, the most favorable market for the property involved. The admin-
 33    istrator may decline the highest bid and reoffer the property for sale  if  in
 34    the judgment of the administrator, the bid is insufficient. If in the judgment
 35    of the administrator, the probable cost of sale exceeds the value of the prop-
 36    erty,  it  need not be offered for sale. Any sale held under this section must
 37    be preceded by a single publication of notice, at least  three  (3)  weeks  in
 38    advance  of sale, in a newspaper of general circulation in the county in which
 39    the property is to be sold.
 40        (2)  Securities listed on an established stock exchange must  be  sold  at
 41    prices prevailing at the time of sale of on the exchange. Other securities may
                                                                        
                                       2
                                                                        
  1    be  sold  over  the counter at prices prevailing at the time of sale or by any
  2    other method the administrator considers advisable.
  3        (3)  A person making a claim under this chapter  is  entitled  to  receive
  4    either the securities delivered to the administrator to by the holder, if they
  5    still  remain in the hands of the administrator, or the proceeds received from
  6    the sale, less any amounts deducted  pursuant  to  section  14-523(23),  Idaho
  7    Code,  but  no  person has any claim under this chapter against the state, the
  8    holder, any transfer agent, registrar, or other person acting for or on behalf
  9    of a holder for any appreciation in the value of the property occurring  after
 10    delivery by the holder to the administrator.
 11        (4)  The  purchaser of property at any sale conducted by the administrator
 12    pursuant to this chapter takes the property free of all claims of the owner or
 13    previous holder thereof and of all persons claiming through or under them. The
 14    administrator shall execute all documents necessary to complete  the  transfer
 15    of ownership.
                                                                        
 16        SECTION  3.  That  Section  14-523, Idaho Code, be, and the same is hereby
 17    amended to read as follows:
                                                                        
 18        14-523.  DISPOSITION OF MONEY RECEIVED. (1) All money received under  this
 19    chapter,  including  the  proceeds  from  the  sale  of property under section
 20    14-522, Idaho Code, shall be deposited in the unclaimed property account.
 21        (2)  An amount equal to the funds received from unclaimed shares and divi-
 22    dends of any corporation incorporated under the laws of  the  state  of  Idaho
 23    shall  be transferred from the unclaimed property account to the public school
 24    permanent endowment fund created pursuant to section 4,  article  IX,  of  the
 25    constitution  of  the state of Idaho. In the event that any funds are required
 26    to refund any funds deposited in the public school  permanent  endowment  fund
 27    under  this section or under section 14-113 or 15-3-914, Idaho Code, the state
 28    tax commission shall offset the amount of such refund against future transfers
 29    to the public school permanent endowment fund. In the event that  in  one  (1)
 30    fiscal  year  there are insufficient amounts to effect the offset, the balance
 31    shall be recaptured from the public school earnings reserve  fund  established
 32    under section 33-902A, Idaho Code.
 33        (3)  All  other money in the unclaimed property account is hereby continu-
 34    ously appropriated to the state  tax  commission,  without  regard  to  fiscal
 35    years,  for  expenditure  in accordance with law in carrying out and enforcing
 36    the provisions of this chapter, including, but not limited to,  the  following
 37    purposes:
 38        (a)  For  payment  of claims allowed by the state tax commission under the
 39        provisions of this chapter.
 40        (b)  For refund, to the person making such deposit of  amounts,  including
 41        overpayments, deposited in error in such account.
 42        (c)  For  payment of the cost of appraisals incurred by the state tax com-
 43        mission covering property held in the name of the account.
 44        (d)  For payment of the cost incurred by the state tax commission for  the
 45        purchase  of lost instrument indemnity bonds, or for payment to the person
 46        entitled thereto, for any unpaid lawful charges or costs which arose  from
 47        holding  any  specific property or any specific funds which were delivered
 48        or paid to the state tax commission, or which arose  from  complying  with
 49        this chapter with respect to such property or funds.
 50        (e)  For  payment  of amounts required to be paid by the state as trustee,
 51        bailee, or successor in interest to the preceding owner.
 52        (f)  For payment of costs of official advertising in connection  with  the
 53        sale of property held in the name of the account.
                                                                        
                                       3
                                                                        
  1        (g)  For  transfer  to  the general account fund as provided in subsection
  2        (34) of this section.
  3        (h)  For transfer to the inheritance tax account  of  the  amount  of  any
  4        inheritance  taxes  determined  to  be due and payable to the state by any
  5        claimant with respect to any property claimed by him under the  provisions
  6        of this chapter.
  7        (34)  At  the  end of each month, or more often, if it deems it advisable,
  8    the state tax commission shall transfer all money in  the  unclaimed  property
  9    account in excess of two hundred fifty thousand dollars ($250,000) to the gen-
 10    eral  account  fund.  Within sixty (60) days of making this transfer, it shall
 11    record the name and last known address, if available, of each person appearing
 12    from the holder's report to be entitled to the property. The record  shall  be
 13    available for public inspection at all reasonable business hours.
 14        (45)  All  money  received under this chapter, including the proceeds from
 15    the sale of property under section 14-522, Idaho Code, deposited in  the  gen-
 16    eral  account fund shall be retained by the state of Idaho for the purposes of
 17    this section and administered pursuant to this section for  a  period  of  ten
 18    (10)  years.  At  the  end  of  such  period, those moneys which have not been
 19    claimed and paid over or delivered as an allowed claim under this section  and
 20    section  14-524,  Idaho  Code,  shall become due and payable by escheat to the
 21    state of Idaho and become the property of the state of Idaho  without  further
 22    action on the part of the administrator.
                                                                        
 23        SECTION  4.  That Section 15-3-914, Idaho Code, be, and the same is hereby
 24    amended to read as follows:
                                                                        
 25        15-3-914.  DISPOSITION OF UNCLAIMED ASSETS. If an heir, devisee or  claim-
 26    ant cannot be found, the personal representative shall distribute the share of
 27    the missing person to his trustee if one has been appointed; or, if no trustee
 28    has  been  appointed,  shall file the report of abandoned property required by
 29    section 14-517, Idaho Code, and proceed to dispose of the property in the man-
 30    ner set forth in the "unclaimed property act," provided, however, that in  the
 31    event  no  person  appears to claim such property within eighteen one thousand
 32    eight hundred and twenty-seven (1,827) days, (approximately five  (5)  years),
 33    from the date of the appointment of the personal representative, the moneys or
 34    property  so  deposited  shall  accrue  and be set over to the general account
 35    transferred to the public school permanent endowment fund created pursuant  to
 36    section 4, article IX, of the constitution of the state of Idaho.

Statement of Purpose / Fiscal Impact



                       STATEMENT OF PURPOSE

                             RS 16917

This bill changes the distribution of funds received as
escheats (estates for which no heirs can be located) and as
unclaimed shares and dividends paid by Idaho corporations to
conform to the requirement of Article 9, Section 4 of the Idaho
Constitution.   That section requires that all such receipts be a
part of the Public School Permanent Endowment Fund.  This allows
the assets of those who pass from this life without heirs to be
retained as a perpetual memorial and provide an ongoing legacy of
income to Idaho schools.  Currently, as required by statute, the
State Tax Commission is distributing these funds to the General
Fund.


                          FISCAL IMPACT

The future annual impact of this change on the General Fund is
expected to be immaterial.  In fiscal 2008, assuming no claimant
steps forward, escheated estates of $3,894.98 are scheduled to be
transferred to the General Fund.  Over the last eleven years
(fiscal 1997 thru fiscal 2007), $351,425.60 from forty-nine
escheated estates and about $1,500 of unclaimed dividends and stock
were (or soon will be) transferred to the General Fund, an average
of approximately $32,000 per year.  

In separate legislation, the Board of Land Commissioners, in
its role as a fiduciary trustee of the endowment, is requesting
that the Public School Fund be made whole by restoring the
$351,425.60 of escheated estates.



Contact  
Name: Senator Brad Little
Phone: 332-1303

Representative Max Black
332-1265

Larry Johnson
Endowment Fund Insurance Board
334-3312


STATEMENT OF PURPOSE/FISCAL NOTE                          S 1098