ZEM H.B. 2360 75(R)BILL ANALYSIS


CIVIL PRACTICES
H.B. 2360
By: Hilbert
4-10-97
Committee Report (Unamended)



BACKGROUND 

The Texas Uniform Transfers to Minors Act was amended in 1995 to raise the
age at which custodianships terminate from 18 to 21. Custodianships
created prior to the change are still required to terminate at age 18.
Some financial institutions have refused to accept new transfers to old
accounts because they believe the Uniform Transfers to Minors Act
prohibits them from doing so.  This legislation would clarify that donors
may make new transfers to pre-1995 custodial accounts. 

PURPOSE

As proposed, HB 2360 would amend the Texas Uniform Transfers to Minors Act
to allow donors to make new contributions into a custodial account created
prior to 1995, the termination date of which would remain age 18. 

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any
additional rulemaking authority to a state officer, department, agency or
institution. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Section 22, Chapter 141, Property Code (Section
141.022, Vernon's Texas Property Code), to provide that this chapter is
not applicable to additional transfers as described in Sec. 25 of the
chapter. 

SECTION 2.  Amends Chapter 141, Property Code (Section 141.001 et seq.,
Vernon's Texas Property Code) by adding Section 25 as follows:  

(a) Limits the scope of the section to transfers made after September 1,
1997 to custodianships created before September 1, 1995. 

(b)  Allows additional transfers to these custodianships to be mixed with
funds already in the custodianship.  Provides that the property of the
custodianship shall be transferred to the beneficiary at age 18 or the
beneficiary's estate if the individual dies before the attaining age 18. 

SECTION 3.  Effective date:  September 1, 1997. Applies prospectively;
savings clause.  

SECTION 4.  Emergency clause.