BILL ANALYSIS

Senate Research Center	C.S.S.B. 658
88R16111 KBB-F	By: Perry
	Jurisprudence
	3/27/2023
	Committee Report (Substituted)

AUTHOR'S / SPONSOR'S STATEMENT OF INTENT

Currently, attorneys who handle money for their clients must participate in the Interest on Lawyers' Trust Accounts (IOLTA) Program, by depositing these funds into an IOLTA bank account. IOLTA accounts insure that attorneys do not co-mingle client funds and that client funds can be adequately managed.

In rare cases, an IOLTA account can become abandoned if an attorney cannot locate a client. In these situations, attorneys turn over abandoned IOLTA accounts to the Comptroller of Public Accounts of the State of Texas's (comptroller's) office as unclaimed property.

The proposed legislation allows unclaimed IOLTA funds to be transferred from the comptroller to the Supreme Court of Texas's judicial fund to help support basic civil legal services.

(Original Author's/Sponsor's Statement of Intent)

C.S.S.B. 658 amends current law relating to the disposition of money from certain attorney accounts delivered to the comptroller as unclaimed property.

RULEMAKING AUTHORITY

Rulemaking authority is expressly granted to the Comptroller of Public Accounts of the State of Texas in SECTION 2 (Section 74.604, Property Code) of this bill.

Rulemaking authority is expressly granted to the Supreme Court of Texas in SECTION 2 (Section 74.604, Property Code) of this bill.

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Section 74.602, Property Code, as follows:

Sec. 74.602. USE OF MONEY. Creates an exception under Section 74.604.

SECTION 2. Amends Subchapter G, Chapter 74, Property Code, by adding Section 74.604, as follows:

Sec. 74.604. DISPOSITION OF MONEY DELIVERED TO COMPTROLLER FROM CERTAIN ATTORNEY ACCOUNTS. (a) Defines "IOLTA account."

(b) Provides that this section, except as provided by Subsection (c), applies to money delivered to the Comptroller of Public Accounts of the State of Texas (comptroller) under Section 74.301 (Delivery of Property to Comptroller) as:

(1) unclaimed or unidentified money in a client trust account established by an attorney or law firm; or

(2) money in an abandoned IOLTA account.

(c) Provides that this section does not apply to money paid or delivered to a reported owner by the comptroller under Section 74.503 (Waiver of Claim Requirement).

(d) Requires the comptroller, notwithstanding any other law, to deposit money to which this section applies to the credit of the basic civil legal services account of the judicial fund. Authorizes money deposited to the credit of the basic civil legal services account under this section, except as provided by Subsection (e), to be appropriated only to the Supreme Court of Texas (supreme court) for use in programs approved by the supreme court that provide basic civil legal services to indigent persons.

(e) Requires the supreme court, if the comptroller pays a claim for money deposited to the credit of the basic civil legal services account under Subsection (d), to reimburse the comptroller from the account for the amount of the claim. Authorizes the supreme court to use money deposited under Subsection (d) to reimburse the comptroller.

(f) Authorizes the comptroller and the supreme court to adopt rules necessary to implement this section.

SECTION 3. (a) Provides that the changes in law made by this Act apply to money described by Section 74.604(b), Property Code, as added by this Act, that was delivered to the comptroller under Section 74.301, Property Code, on, before, or after the effective date of this Act.

(b) Requires the comptroller, as soon as practicable after the effective date of this Act, to identify money described by Subsection (a) of this section that was delivered to the comptroller before the effective date of this Act and for which a claim has not been paid by the comptroller and that has not otherwise been paid or delivered to a reported owner by the comptroller under Subchapter F (Claim for Delivered Property), Chapter 74, Property Code, and deposit the money to the credit of the basic civil legal services account in the judicial fund in accordance with Section 74.604(d), Property Code, as added by this Act.

SECTION 4. Effective date: September 1, 2023.