SRC-AAA S.B. 887 75(R)   BILL ANALYSIS


Senate Research Center   S.B. 887
By: Harris
Jurisprudence
3-20-97
As Filed


DIGEST 

In 1995, the  Uniform Transfers to Minors Act was amended to raise the age
at which custodianships terminate from 18 to 21.  Custodianships created
prior to the amendment of the Act  are still required to terminate at age
18.  Some financial institutions have refused to accept new transfers to
old accounts because they believe the Act prohibits them from doing so.
S.B. 887 would amend the Uniform Transfers to Minors Act to allow donors
to make new contributions into a custodial account prior to 1995, the
termination date of which would remain age 18. 

PURPOSE

As proposed, S.B. 887 amends the Uniform Transfers to Minors Act to allow
donors to make new contributions into a pre-1995 custodial account,  the
termination date of which would remain age 18.  

RULEMAKING AUTHORITY

This bill does not grant any additional rulemaking authority to a state
officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Section 141.022, Property Code, to make a conforming
change. 

SECTION 2. Amends Chapter 141, Property Code, by adding Section 25, as
follows: 

Sec. 25.  ADDITIONAL TRANSFERS TO CUSTODIANSHIPS IN EXISTENCE BEFORE
EFFECTIVE DAY OF ACT.  Provides that this section applies only to
transfers within the scope of Section 3 made after September 1, 1997, to a
custodian of a custodianship established before September 1, 1995, under
the Texas Uniform Gifts to Minors Act (TUGMA).  Provides that this chapter
does not prevent a person from making additional transfers to a
custodianship described in Subsection (a) of this section.  Requires
certain custodial property to be commingled with custodial property of a
custodianship established under TUGMA.  Requires the additional transfers
to be administered and distributed on termination of the custodianship,
except that the custodian shall transfer the custodial property to certain
beneficiaries. 

SECTION 3. Effective date: September 1, 1997.
  Makes application of this Act prospective.

SECTION 4. Emergency clause.