Honorable Kevin Eltife, Chair, Senate Committee on Business & Commerce
FROM:
Ursula Parks, Director, Legislative Budget Board
IN RE:
SB1916 by Watson (Relating to the escheat of Unites States savings bonds.), As Introduced
The bill would add U.S. savings bonds as property to be escheated to the state of Texas and provide that U.S. savings bonds which are presumed abandoned, including bonds in the possession of the Comptroller and lost, stolen, or destroyed bonds registered to persons with last known addresses in Texas, would escheat to Texas three years after such bonds are presumed abandoned. The fiscal impact of this bill cannot be determined because it requires the Comptroller to file suit to receive a judgement that savings bonds have been escheated to Texas. Neither the result nor duration of such a suit can be predicted at this time. However, if the suit were successful Texas could receive initial revenue to unclaimed property of approximately $4,000,000 followed by yearly inflows of about $300,000.
The bill would amend Chapter 71 of the Property Code, regarding unclaimed property.
The bill would add Subchapter E, regarding escheat of U.S. savings bonds. The bill would add U.S. savings bonds as property to be escheated to the state of Texas. The bill would provide that U.S. savings bonds which are presumed abandoned, including bonds in the possession of the Comptroller and lost, stolen, or destroyed bonds registered to persons with last known addresses in Texas, would escheat to Texas three years after such bonds are presumed abandoned.
The bill would provide that within 180 days after the applicable three year abandonment period the Comptroller could commence a civil action for a determination that such savings bonds have escheated to Texas. If the court entered a judgement that the savings bonds have escheated to Texas, the legal title to and ownership of such savings bonds would vest solely in the State of Texas. The bill would specify a process to file a claim for savings bonds escheated to Texas.
The fiscal impact of this bill cannot be determined because it requires the Comptroller to file suit to receive a judgement that savings bonds have been escheated to Texas. Neither the result nor duration of such a suit can be predicted at this time. However, if the suit were successful Texas could receive initial revenue to unclaimed property of approximately $4,000,000 followed by yearly inflows of about $300,000.
The bill would take effect immediately upon enactment, assuming it received the requisite two-thirds majority votes in both houses of the Legislature. Otherwise, it would take effect September 1, 2015.
Local Government Impact
No fiscal implication to units of local government is anticipated.