SLS 201ES-27 ENGROSSED 2020 First Extraordinary Session SENATE BILL NO. 12 BY SENATOR FESI UNCLAIMED PROPERTY. Constitutional amendment to dedicate unclaimed property funds and to create the Louisiana Unclaimed Property Permanent Trust Fund. (2/3 - CA13s1(A)) (Item #10) (7/1/21) 1 A JOINT RESOLUTION 2 Proposing to add Article VII, Section 10(F)(4)(i) and Part V of Article VII, to be comprised 3 of Section 28, of the Constitution of Louisiana, relative to unclaimed property funds; 4 to provide for the creation of a special trust fund; to provide for the dedication and 5 credit of unclaimed property monies; to provide for the investment, administration, 6 and use of the monies in the special trust fund; to exempt the monies in the fund 7 from reduction in certain circumstances; to provide for certain reporting 8 requirements; to provide for appropriation of monies in the special fund; to provide 9 for an effective date; and to specify an election for submission of the proposition to 10 electors and provide a ballot proposition. 11 Section 1. Be it resolved by the Legislature of Louisiana, two-thirds of the members 12 elected to each house concurring, that there shall be submitted to the electors of the state, for 13 their approval or rejection in the manner provided by law, a proposal to add Article VII, 14 Section 10(F)(4)(i) and Part V of Article VII, comprised of Section 28, of the Constitution 15 of Louisiana, to read as follows: 16 §10. Expenditure of State Funds 17 * * * Page 1 of 5 Coding: Words which are struck through are deletions from existing law; words in boldface type and underscored are additions. SB NO. 12 SLS 201ES-27 ENGROSSED 1 (F) 2 * * * 3 (4) The provisions of Subparagraphs (1) and (2) of this Paragraph shall not 4 be applicable to, nor affect: 5 * * * 6 (i) The Louisiana Unclaimed Property Permanent Trust Fund, as 7 provided in Article VII, Section 28 of this constitution. 8 * * * 9 PART V. UNCLAIMED PROPERTY 10 §28. Louisiana Unclaimed Property Permanent Trust Fund 11 Section 28.(A) Creation of Fund. (1) Effective July 1, 2021, there shall be 12 established in the state treasury as a special permanent trust fund, the 13 Louisiana Unclaimed Property Permanent Trust Fund, referred to as the "UCP 14 Permanent Trust Fund". No appropriation shall be made from the UCP 15 Permanent Trust Fund. 16 (2) The purpose of the UCP Permanent Trust Fund is to ensure a source 17 of payment for claims made by owners of unclaimed property. The monies in 18 the fund are exempted from the requirements of Article VII, Section 9(B) of this 19 constitution requiring the allocation of money received by the state to the Bond 20 Security and Redemption Fund. The treasurer shall at least annually deposit in 21 and credit to the UCP Permanent Trust Fund the net amount of all monies 22 received as a result of the Uniform Unclaimed Property Act of 1997 or its 23 successor. 24 (3) Realized capital gains, dividend income, and interest income, earned 25 on the investments in the UCP Permanent Trust Fund, net of trust fund 26 investment and administrative expenses, shall be deposited into the State 27 General Fund. 28 (4) All monies shall be credited to the fund as provided in Subparagraph 29 (2) of this Paragraph until the balance in the UCP Permanent Trust Fund Page 2 of 5 Coding: Words which are struck through are deletions from existing law; words in boldface type and underscored are additions. SB NO. 12 SLS 201ES-27 ENGROSSED 1 equals the amount of the state's potential liability to unclaimed property 2 claimants as reported in the previous fiscal year pursuant to Paragraph (C) of 3 this Section. All money received above the state's potential liability to unclaimed 4 property claimants as reported by the state treasurer shall be deposited into the 5 State General Fund. 6 (B) Investment and Administration. The money credited to the UCP 7 Permanent Trust Fund pursuant to Paragraph (A) of this Section shall be 8 permanently credited to the UCP Permanent Trust Fund and shall be invested 9 by the treasurer. Notwithstanding any provision of this constitution to the 10 contrary, a portion of money in the UCP Permanent Trust Fund, not to exceed 11 fifty percent of the money in the UCP Permanent Trust Fund, may be invested 12 in equities. The legislature shall establish by law procedures for the investment 13 of such monies. The treasurer may contract, subject to the approval of the State 14 Bond Commission, for the management of such investments. Investment 15 earnings shall be available for appropriation to pay expenses incurred in the 16 investment and management of the UCP Permanent Trust Fund. 17 (C) Reports; Allocation. (1) Not less than sixty days prior to the 18 beginning of each regular session of the legislature, the state treasurer shall 19 submit to the legislature and the governor a report of the following: 20 (a) The balance of the UCP Permanent Trust Fund as of the close of the 21 prior fiscal year. 22 (b) The state's potential liability to unclaimed property claimants as of 23 the close of the prior fiscal year. 24 (2) Notwithstanding the provisions of Subparagraph (1) of this 25 Paragraph, not less than sixty days prior to the beginning of the 2022 Regular 26 Session of the legislature, the state treasurer shall submit to the legislature and 27 the governor a report of the following: 28 (a) The balance of the UCP Permanent Trust Fund as of January 1, 2022. 29 (b) The state's potential liability to unclaimed property claimants as of Page 3 of 5 Coding: Words which are struck through are deletions from existing law; words in boldface type and underscored are additions. SB NO. 12 SLS 201ES-27 ENGROSSED 1 the close of the prior fiscal year. 2 (3) If unclaimed property claims exceed receipts, the state treasurer shall 3 certify the amount needed to pay received claims and shall allocate sufficient 4 funds from the UCP Permanent Trust Fund to pay that amount. The state 5 treasurer shall also immediately notify the legislature and governor of the 6 amount transferred from the UCP Permanent Trust Fund and amount 7 remaining in the UCP Permanent Trust Fund. 8 (D) Private Property. Property received by the state pursuant to the 9 Uniform Unclaimed Property Act of 1997 or its successor and deposited into the 10 UCP Permanent Trust Fund is private property held in trust until a claim is 11 made for it by the owner. 12 Section 2. Be it further resolved that the provisions of the amendment contained 13 in this Joint Resolution shall become effective on July 1, 2021. 14 Section 3. Be it further resolved that this proposed amendment shall be submitted 15 to the electors of the state of Louisiana at the statewide election to be held on November 3, 16 2020. 17 Section 4. Be it further resolved that on the official ballot to be used at said election 18 there shall be printed a proposition, upon which the electors of the state shall be permitted 19 to vote YES or NO, to amend the Constitution of Louisiana, which proposition shall read as 20 follows: 21 Do you support an amendment to create the Louisiana 22 Unclaimed Property Permanent Trust Fund to preserve the 23 money that remains unclaimed by its owner or owners? 24 (July 1, 2021) (Adds Article VII, Sections 10(F)(4)(i) and 28) The original instrument and the following digest, which constitutes no part of the legislative instrument, were prepared by Jerry J. Guillot. DIGEST SB 12 Engrossed 2020 First Extraordinary Session Fesi Proposed constitutional amendment creates the UCP Permanent Trust Fund to be used solely for the payment of claims made by owners. Further, exempts the UCP Permanent Trust Fund from present constitution requirements relative to the Bond Security and Redemption Fund. Page 4 of 5 Coding: Words which are struck through are deletions from existing law; words in boldface type and underscored are additions. SB NO. 12 SLS 201ES-27 ENGROSSED Proposed constitutional amendment prohibits appropriation from the UCP Permanent Trust Fund. Proposed constitutional amendment requires the net amount of monies received pursuant to present law (Uniform Unclaimed Property Act, R.S. 9:151 et seq.) to be credited to the UCP Permanent Trust Fund. Further provides that realized capital gains, dividend income, and interest income, earned on investments in the fund, net of trust fund investment and administrative expenses, shall be deposited into the State General Fund. Proposed constitutional amendment requires the state treasurer to annually report the UCP Permanent Trust Fund balance and the state's potential liability for unclaimed property claims to the legislature and the governor. Further authorizes money to be deposited into the UCP Permanent Trust Fund until the balance in that fund equals the state's reported potential liability for all unclaimed property. Once this threshold is reached in the UCP Permanent Trust Fund, proposed constitutional amendment requires any additional money received to be deposited into the State General Fund. Proposed constitutional amendment authorizes the state treasurer to invest up to 50% of the balance in the UCP Permanent Trust Fund in equities. Requires the legislature to establish procedures for the investment of the funds and authorizes the treasurer to contract for the management of the investments. Proposed constitutional amendment authorizes the treasurer to transfer money from the UCP Permanent Trust Fund if claims for unclaimed property exceed receipts. Requires the treasurer to certify the amount needed to pay claims received and immediately notify the legislature and the governor of the new fund balance once he has transferred the money. Proposal constitutional amendment becomes effective on July 1, 2021. Specifies submission of the amendment to the voters at the statewide election to be held on November 3, 2020. (Adds Const. Art. VII, §10(F)(4)(i) and §28) Page 5 of 5 Coding: Words which are struck through are deletions from existing law; words in boldface type and underscored are additions.