04/29/2004 02:46 PM Senate L&C

        HB 517-SECURITY ACCOUNT BENEFICIARY DESIGNATION                                                                     
                                                                                                                                
CHAIR CON BUNDE announced HB 517 to be up for consideration.                                                                    
                                                                                                                                
MR.  JOSH   APPLEBEE,  staff  to  Representative   Tom  Anderson,                                                               
sponsor, said HB 517 permits  an investment management or custody                                                               
account with a  trust company or a trust division  of a bank with                                                               
trust powers to  have a beneficiary designation  take effect upon                                                               
the  death  of the  owner  of  the  account. Under  current  law,                                                               
securities   and  brokerage   accounts   have  this   beneficiary                                                               
designation take effect  upon the death of the  owner pursuant to                                                               
the Uniform Transfer On Debt  Security Registration Act. However,                                                               
the current definition  in Alaska is not broad  enough to include                                                               
investment management  or custody  accounts, which  are generally                                                               
used  by trust  departments  and banks.  This  problem cannot  be                                                               
solved   other  than   by  statute.   Several  states   including                                                               
California, Idaho,  Iowa, Minnesota  and Washington  have enacted                                                               
similar  legislation in  the last  three years.  HB 517  will now                                                               
allow these investment  products to avoid probate  by providing a                                                               
statutory authorization to use a  beneficiary designation to take                                                               
effect upon death. It will also  put bank trust departments on an                                                               
equal footing with brokerage firms.  There is wide spread support                                                               
for  this bill  including  Wells Fargo  and  the Alaska  Banker's                                                               
Association.                                                                                                                    
                                                                                                                                
CHAIR BUNDE  said that he  now had a  quorum, but wanted  to give                                                               
members some time to look at the bill.                                                                                          
   HB 517(title am)-SECURITY ACCOUNT BENEFICIARY DESIGNATION                                                                
                                                                                                                                
CHAIR CON BUNDE announced HB 517(title  am) to be back before the                                                               
committee.                                                                                                                      
                                                                                                                                
MR. JOSH  APPLEBEE recapped  that HB  517(title am)  allows trust                                                               
custody accounts  at a bank or  trust company to use  the time of                                                               
death  designation.  When  an  owner  of  an  account  dies,  the                                                               
beneficiary will take over at the time of death.                                                                                
                                                                                                                                
SENATOR  GARY  STEVENS  moved  to  pass  HB  517(title  am)  from                                                               
committee    with   attached    fiscal   note    and   individual                                                               
recommendations. Senators  Bettye Davis,  Gary Stevens  and Chair                                                               
Con Bunde voted yea; and HB 517(title am) moved from committee.