BILL ANALYSIS Ó
SB 495
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Date of Hearing: July 13, 2011
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
SB 495 (Fuller) - As Amended: July 5, 2011
Policy Committee:
JudiciaryVote:10-0 (Consent)
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill makes several changes to the Unclaimed Property Law
(UPL), which is administered by the State Controller.
Specifically, this bill:
1)Extends, from 18 months to seven years, the minimum time
period that property of no commercial value must be held by
the controller under the UPL.
2)Provides statutory authorization for a compliance program,
which was funded in the 2011-12 Budget Act, for the controller
to identify holders of unclaimed property who are not in
compliance with specified filing reports.
3)Makes several technical changes clarifying criteria for
escheat, property held by a fiduciary, and property holder
reporting requirements.
FISCAL EFFECT
Minor annual costs to the controller for additional storage
associated with the extended period to hold property with no
commercial value.
COMMENTS
1)Background . The UPL requires that funds held by a business
association in various accounts or in safe-deposit boxes
escheat to the state after a designated period of time, if the
apparent owner fails to take any actions to claim the property
or otherwise correspond with the holder of the property. This
SB 495
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can happen for a variety of reasons, but is most often due to
a death, relocation, or transfer of property to an heir or
relative having little or no knowledge of the account. At a
certain point, usually after three years of non-activity or
abandonment, the business holder reports to the controller and
the property escheats to the state. The UPL also specifies the
amount of time the controller must retain the property before
selling or disposing of it, assuming the rightful owner cannot
be located.
2)Purpose . According to State Controller John Chiang (sponsor),
his office receives numerous complaints about property that
was turned over too quickly to the state or which the state
disposed of too quickly as property with "no commercial
value," even though that property had great sentimental value
to the owner. Extending the minimum time for holding such
property will benefit owners, as many important legal or
personal documents do not have commercial value and were
previously destroyed before owners had the opportunity to
claim their property.
The compliance program was authorized in this bill was funded
in this year's budget-$528,000 for 5 three-year limited term
positions. The controller's office estimates that the program
will result in additional revenues of $5 million in 2012-13
and $11.7 million in 2013-14.
Analysis Prepared by : Chuck Nicol / APPR. / (916) 319-2081