Sponsor Statement for HB 417

"An Act Relating to the Unclaimed Property of Persons Dying Intestate."

Under current law, when there are assets from an estate for which there was no will and there are no known heirs, the state has certain responsibilities and procedures for determining whether there are heirs to the estate. If no living heirs are located, the assets pass to the state. House Bill 417 provides that certain community organizations in the municipality in which the decedent last lived may apply for these assets if the state has had possession of them for a period of five years and no one has come forward to claim them. If no community organization applies for the assets, they become the property of the state.

If only one organization applies, the Department of Revenue will give the estate to that organization. If there is more than one organization that qualifies and applies, they may agree to share the property. If the organizations do not agree to share, then the appropriate local government—either the city or borough—will identify the applicant that provides its services the most broadly throughout the municipality.

In order to qualify, a community organization must be located in the city in which the decedent lived, or in the borough if the decedent didn’t live in a city. It must also be a nonprofit corporation exempt from federal taxation, be operated exclusively to provide services promoting the well being of the residents of the municipality, and have been in existence for at least three years.

Under HB 417, the state’s only additional responsibility will be to publish a notice in the municipality in which the decedent lived stating that the decedent died intestate and that no heirs have been identified. It is the responsibility of the community organization to investigate whether it may be qualified to receive the estate and to apply for it.

Generally, when an individual dies intestate with no heirs, the size of the estate is not large from the state’s perspective. However, the funds from the estate could be used by a community organization to greatly benefit the community at large. House Bill 417 provides a mechanism by which these organizations can apply for an estate, without causing the state undue expense or administrative time.

HB417ss:3/2/98