SRC-AXB H.B. 115 76(R)   BILL ANALYSIS


Senate Research Center   H.B. 115
76R7970  CAS-FBy: Smith (Harris)
Jurisprudence
4/15/1999
Engrossed


DIGEST 

Currently, a person who establishes a trust identifies the recipients of
the trust.  However, if those recipients die, or in the case of a
charitable entity, cease to exist, then another beneficiary may be
subsequently named by the trustee.  However, the subsequent beneficiary can
also be named without the agreement of, and without consulting the initial
trustee who established the charitable trust.  H.B. 115 establishes
procedures for the designation of a replacement charitable beneficiary.  

PURPOSE

As proposed, H.B. 115 sets forth provisions for the designation of a
replacement charitable beneficiary. 

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 Chapter 113A, Property Code, by adding Section 113.026,
as follows: 

Sec.  113.026.  AUTHORITY TO DESIGNATE NEW CHARITABLE BENEFICIARY. Defines
"charitable entity" and "failed charitable beneficiary."  Limits the
application of this section to include only an express written trust
created by an individual with a charitable entity as a beneficiary
(charity).  Sets forth provisions regarding the authority of the trust
instrument.  Authorizes the trustee of a trust to select a replacement
charity.  Sets forth requirements for replacement charities.  Requires the
trustee to consult with the settlor of the trust regarding a replacement
charity, if the settlor meets certain qualifications.  Sets forth
provisions for sending notice of the selection of a replacement charity to
the attorney general. Sets forth requirements for the condition of a
trustee and settlor who disagree on the replacement charity selection. 

SECTION 2.  Makes application of this Act prospective.

SECTION 3.  Emergency clause.
  Effective date:  upon passage