EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
Underlining indicates amendments to bill.
Strike out indicates matter stricken from the bill by amendment or deleted from the law by
amendment.
Italics indicate opposite chamber/conference committee amendments.
*sb0561*
SENATE BILL 561
C1, C5 (5lr1220)
ENROLLED BILL
— Judicial Proceedings/Economic Matters —
Introduced by Senators Hershey and Mautz
Read and Examined by Proofreaders:
_______________________________________________
Proofreader.
_______________________________________________
Proofreader.
Sealed with the Great Seal and presented to the Governor, for his approval this
_______ day of _______________ at __ ______________________ o’clock, ________M.
______________________________________________
President.
CHAPTER ______
AN ACT concerning 1
Corporations and Associations – Electric Cooperatives – Nonescheat Capital 2
Credits 3
FOR the purpose of providing that certain unclaimed money held by an electric cooperative 4
and due to a past member is not considered abandoned property; authorizing an 5
electric cooperative to use this money only for certain purposes; and generally 6
relating to electric cooperatives and nonescheat capital credits. 7
BY repealing and reenacting, without amendments, 8
Article – Commercial Law 9
Section 17–304(b) 10
Annotated Code of Maryland 11
(2013 Replacement Volume and 2024 Supplement) 12
BY repealing and reenacting, with amendments, 13 2 SENATE BILL 561
Article – Commercial Law 1
Section 17–304(g) 2
Annotated Code of Maryland 3
(2013 Replacement Volume and 2024 Supplement) 4
BY repealing and reenacting, without amendments, 5
Article – Corporations and Associations 6
Section 5–601(a) and (c) and 5–605 7
Annotated Code of Maryland 8
(2014 Replacement Volume and 2024 Supplement) 9
BY adding to 10
Article – Corporations and Associations 11
Section 5–650.1 12
Annotated Code of Maryland 13
(2014 Replacement Volume and 2024 Supplement) 14
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 15
That the Laws of Maryland read as follows: 16
Article – Commercial Law 17
17–304. 18
(b) Any stock or other certificate of ownership, or any dividend, profit, 19
distribution, interest, payment on principal, or other sum held by a business association for 20
or to a shareholder, certificate holder, member, bondholder or other security holder, or 21
participating patron of a cooperative is presumed abandoned 3 years after the later of: 22
(1) The date the holder is deemed to no longer have a valid address for the 23
owner of the property; or 24
(2) The date the owner last communicated with the business association 25
regarding the property if: 26
(i) It is held by a business association organized under the laws of 27
or created in this State; 28
(ii) It is held by a business association doing business in this State 29
but not organized under the laws of this State, and the records of the business association 30
indicate that the last known address of the person entitled to it is in this State; or 31
(iii) It is held by a business association not doing business in this 32
State and not organized under the laws of this State, but the records of the business 33
association indicate that the last known address of the person entitled to it is in this State. 34
(g) This section does not apply to [any]: 35 SENATE BILL 561 3
(1) ANY stock or other intangible ownership interest enrolled in a plan that 1
provides for the automatic reinvestment of dividends, distributions, or other sums payable 2
as a result of the interest unless the records available to the Administrator of the plan 3
show, with respect to any intangible ownership interest not enrolled in the reinvestment 4
plan, that: 5
[(1)] (I) The holder is deemed to no longer have a valid address for the 6
owner of the stock or other intangible ownership interest; or 7
[(2)] (II) The owner has not within 3 years communicated in any manner 8
described in subsection (c)(2) of this section; OR 9
(2) NONESCHEAT CAPITAL CR EDITS, AS DEFINED IN § 5–650.1 OF THE 10
CORPORATIONS AND ASSOCIATIONS ARTICLE. 11
Article – Corporations and Associations 12
5–601. 13
(a) In this subtitle the following words have the meanings indicated. 14
(c) “Cooperative” means a corporation that: 15
(1) Is organized under this subtitle; or 16
(2) Becomes subject to this subtitle in the manner provided in this subtitle. 17
5–605. 18
A cooperative, nonprofit, membership corporation may be organized under this 19
subtitle for the purpose of supplying, promoting, and extending the use of electricity. 20
5–650.1. 21
(A) IN THIS SECTION, “NONESCHEAT CAPITAL C REDITS” MEANS MONEY : 22
(1) DUE TO ANY PAST MEMBE R OF A COOPERATIVE I N RETIREMENT 23
OF CAPITAL ALLOCATED ON A PATRONAGE BASIS TO THE ACCOUNT OF TH E PAST 24
MEMBER FOR AMOUNTS R ECEIVED AND RECEIVAB LE BY THE COOPERATIV E IN 25
EXCESS OF OPERATING COSTS AND EXPENSES FROM THE DATE OF THE 26
COOPERAT IVE’S INCORPORATION IN T HE STATE; 27
(2) FOR WHICH AT LEAST 5 YEARS HAVE PASSED SI NCE THE CREDITS 28
WERE RETIRED ; AND 29 4 SENATE BILL 561
(3) THAT HAS NOT BEEN CLA IMED BY THE PAST MEM BER. 1
(B) A COOPERATIVE MAY USE NONESCHEAT CAPITAL C REDITS ONLY TO: 2
(1) ASSIST MEMBERS O F THE COOPERATIVE IN ACCORDANCE WITH 3
THE POWERS GRANTED T O THE COOPERATIVE UN DER § 5–607 OF THIS SUBTITLE ; 4
OR 5
(2) MAKE DONATIONS TO NON PROFIT, CHARITABLE ORGANIZAT IONS 6
APPROVED BY THE COOP ERATIVE’S BOARD OF DIRECTORS . 7
(C) NOTHING IN THIS SECTI ON MAY B E CONSTRUED TO RELIE VE A 8
COOPERATIVE OF THE O BLIGATION TO REFUND NONESCHEAT CAPITAL C REDITS ON 9
APPLICATION OF A PAS T MEMBER. 10
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect 11
October 1, 2025. 12
Approved:
________________________________________________________________________________
Governor.
________________________________________________________________________________
President of the Senate.
________________________________________________________________________________
Speaker of the House of Delegates.