Legislature(2003 - 2004)
04/26/2004 09:01 AM Senate FIN
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* first hearing in first committee of referral
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+ teleconferenced
= bill was previously heard/scheduled
CS FOR SENATE BILL NO. 231(STA)
"An Act relating to unclaimed property; and providing for an
effective date."
This was the second hearing for this bill in the Senate Finance
Committee.
Co-Chair Wilken stated this bill, sponsored by the Senate Rules
Committee at the request of the Governor, "shortens the time period
after which certain unclaimed property is presumed to be abandoned
and must be transferred to the custody of the State. Senate Bill
231 conforms to the most current Uniform Unclaimed Property Act."
RACHEL LEWIS, Unclaimed Property Administrator, Division of
Treasury, Department of Revenue, testified this legislation would
shorten dormancy periods for unclaimed property. This, she
informed, would provide the State the opportunity to locate owners
of unclaimed property quicker, and would allow companies that hold
"uncashed" checks and banks with inactive accounts to "clean those
off their books" in a timely manner. She stated that holding
unclaimed property creates a liability for companies and banks and
that the State would become the active custodian for these assets.
She also noted that this legislation would allow assets to become
the property of the State sooner to the benefit of all residents.
She explained that these funds could be used for schools, road
projects and other programs until the owner submits a claim for the
assets.
Co-Chair Wilken amendment explanations
Amendment #2: This amendment changes the language in Section 5 on
page 3, lines 14 - 30 to read as follows.
Sec. 5. AS 34.45 is amended by adding a new section to read:
Sec. 34.45.175. Certain property distributed in insurance
company reorganizations. (a) The following property
distributable in the course of a demutualization or related
reorganization of an insurance company is deemed abandoned two
years after the date of demutualization or reorganization as
follows:
(1) money that remains unclaimed and the owner has
not otherwise communicated with the holder or its agent
regarding the property as evidenced by a memorandum or other
record on file with the holder or its agent;
(2) stock or other equity interest if
(A) the instruments or statements reflecting
the distribution are either mailed to the owner and
returned by the post office as undeliverable, or not
mailed to the owner because of an address on the books
and records of the holder that is known to be incorrect;
and
(B) the owner has not otherwise communicated
with the holder or its agent regarding the property as
evidenced by a memorandum or other record on file with
the holder or its agent.
(b) Property that is not subject to (a) of this section
is reportable as otherwise provided in AS 34.45.110 -
34.45.780.
Co-Chair Wilken moved for adoption and objected for an explanation.
Ms. Lewis noted that the legislation contains a definition of
demutualization that "did not fit the stylistic needs of Alaska
statutes." This amendment, she stated was drafted by the Department
of Law to better conform the definition to Alaska statutes.
Co-Chair Wilken removed his objection and the amendment was ADOPTED
without objection.
Amendment #3: This amendment inserts two new bill sections on page
8, following line 14 to read as follows.
Sec. 14. AS 34.45.320(d) is amended to read:
(d) the holder of an equity [OWNERSHIP] interest under AS
34.45.200 shall deliver a duplicate certificate, or other
evidence of ownership if the holder does not issue
certificates of ownership, to the department. Upon delivery of
a duplicate certificate to the department, the holder and a
transfer agent, registrar, or other person acting for or on
behalf of a holder in executing or delivering the duplicate
certificate is relieved of all liability, in accordance with
the provisions of AS 34.45.330 to every person, including a
person acquiring the original certificate or the duplicate of
the certificate issued to the department, for loss or damage
resulting to a person by the issuance and delivery to the
department of the duplicate certificate.
Sec. 15. AS 34.45.330(c) is amended to read:
(c) A holder who has delivered property [, INCLUDING A
CERTIFICATE OF AN OWNERSHIP INTEREST IN A BUSINESS
ASSOCIATION,] other than money to the department under AS
34.45.110 - 34.45.430 [,] may reclaim the property if it is
still in the possession of the department, without payment of
a fee or other charge, upon filing proof that the owner has
claimed the property from the holder.
New Text Underlined [DELETED TEXT BRACKETED]
Co-Chair Wilken moved for adoption and objected for an explanation.
Ms. Lewis explained this amendment reflects recommendations from
the Division of Legal and Research Services to address grammar and
punctuation.
Co-Chair Wilken removed his objection.
Co-Chair Green asked if this amendment would insert new language
into the bill.
Ms. Lewis replied that the Department of Law recommended against
utilizing "ownership" and "equity" in the same sentence and this
amendment therefore delineates the two words.
Co-Chair Wilken noted this amendment was submitted at the request
of the Division of Legal and Research Services.
Without objection the amendment was ADOPTED.
Co-Chair Green offered a motion to report SB 231, as amended from
Committee with individual recommendations and accompanying fiscal
note.
There was no objection and CS SB 231 (FIN) MOVED from Committee
with fiscal note #2 for $60,000 from the Department of Revenue.
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