SB 65-RETIREMENT PLANS; ROTH IRAS; PROBATE  1:56:55 PM CHAIR COGHILL announced the consideration of SB 65. He described the bill as a continuing update of trust doctrine law and relayed that he was carrying the bill this year. 1:57:43 PM CHAD HUTCHINSON, Staff to Senator Coghill, stated that SB 65 has wide support from banks. It updates Alaska trust laws, which haven't been updated since 1997. He explained that when the statutes were enacted they put Alaska at the forefront and created commerce and jobs in a variety of fields including insurance, legal, trust and banking. However, since 1997 other states have enacted similar legislation and surpasses Alaska law. He opined that SB 65 will diversify the state's economic portfolio and make it highly competitive in the financial planning sector. It will generate revenue for the state by encouraging residents and nonresidents to plan their financial future and security in Alaska. The bill benefits everyone, he said. 2:01:15 PM CHAIR COGHILL noted that Marty Hester, David Shaftel, and Douglas Blattmachr were available to testify and answer questions. 2:01:44 PM DAVID SHAFTEL, Attorney, Anchorage, Alaska, stated that his law office focuses on estate planning and estate trust administration. He related that he has worked with a group of attorneys and trust officers since 1997 to recommend improvements to Alaska trust and estate laws. He explained that SB 65 amends the Uniform Principle and Income Act to conform to final IRS regulation; it amends the Alaska Uniform Transfer to Minors Act to continue management of the minor's assets beyond the age of maturity if he/she desires; it enacts a majority of rule in the retirement account area that provides protection for beneficiaries' interests; and it allows for the transfer of IRAs. In the area of life insurance, SB 65 clarifies that trustees of life insurance trusts can have insurable interests, and it relieves trustees of life insurance trusts of liability with respect to insurance policies that the clients have purchased. The bill also clarifies the remedies in the limited liability company and limited partnership area. There is also a provision new to Alaska law that addresses the disposition of human remains. As part of estate planning, a person can designate who will make those decisions using the form that is included under that amendment. In 1998 Alaska enacted a community property regime that minimizes capital gains taxes when property is sold by the surviving spouse. SB 65 contains provisions under the community property regime that clarify title matters and rules for recovering improper gifts. The bill also enacts decanting provisions for modifying trusts. He described SB 65 as an excellent bill. CHAIR COGHILL noted that four members of the committee heard a substantially similar bill last year. 2:08:17 PM DOUGLAS BLATTNACHR, President and CEO, Alaska Trust Corporation (ATC), Anchorage, Alaska, stated that ATC strongly supports passage of SB 65, but would like Sections 34 and 35 removed. They should be in a separate bill. CHAIR COGHILL stated his intention to introduce a committee substitute (CS) that does not include those sections, and provide an explanation. 2:09:44 PM BETH CHAPMAN, Attorney, Juneau, Alaska, said she practices primarily in the area of trusts and estates and she believes that SB 65 is in the best interest of Alaskans. It will help alleviate the need to go to court, particularly to respond to changes in circumstances with families. SENATOR WIELECHOWSKI noted that tab 8 of the bill packet has a legal opinion that says the bill could violate the single subject rule. He suggested the committee arrange to hear from an attorney to discuss that opinion, because the bill may have constitutional problems. MR. HUTCHINSON said he would provide a copy of the legal opinion that responds to that memorandum. SENATOR WIELECHOWSKI said he would like someone to go over the bill with him section by section before he votes on it. He agreed that it would be acceptable if that took place in his office. CHAIR COGHILL said he would make sure someone visited his office, but his intention was to introduce the bill today and delve into it on Wednesday. 2:12:35 PM CHAIR COGHILL held SB 65 in committee.