Juneau -- The Alaska Senate Thursday passed the first measure of the second session of the 21st Legislature. Senate Bill 162, sponsored by Senator Robin Taylor (R-Wrangell), corrects a technical problem created by the Alaska Trust Act, and allows individuals to create perpetual charitable lead trusts.

"A typical perpetual charitable lead trust would pay all income to a charity for a term of 20 years before benefiting the trust creator's descendants" said Taylor. "The problem with the Alaska Trust Act is that it does not allow a person to create this type of trust. Since the passage of the act, many people have expressed a desire to create perpetual charitable lead trusts. This bill will allow them to do just that."

Alaskan charities may see increased donations as a result of this legislation. With the option of perpetual charitable lead trusts available, creators of the trusts could choose Alaskan charities as their beneficiaries.

"The Alaska Trust Act is the only legislation of it's kind in the United States, and it effectively repealed the old common law rule against perpetuities," said Taylor. "Under the perpetuities rule, trusts could not extend for longer than 90 to 110 years. The Alaska Trust Act changed the common law rule to allow financial trusts to continue in perpetuity if they meet the required guidelines."

The Alaska Trust Act creates a financial environment that is attractive to individuals in all 50 states that are interested in creating perpetual trusts, and could positively impact the Alaskan financial market by bringing in large financial trusts.

SB 162 now goes to the House for consideration.

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