Pending Legislation – States Take An Interest (in Interest)
It’s been a while since we’ve done an update of proposed unclaimed property laws that are pending in state legislatures around the country. Below are some of the more notable recent proposals. As always, these are just bills – proposed legislation – not laws. (For more information on how a bill becomes law, see here).
California – Senate Bill 495 – Would lengthen the dormancy period for safe deposit boxes from 3 years to 5 years, establish a “compliance program” for holders of unclaimed property, and require the Controller to pay interest on certain unclaimed property reclaimed by the rightful owner.
Ohio – House Bill 110 – Requires the state to pay interest on certain claimed unclaimed property.
Why the interest in interest? In Ohio’s case, its due to the Ohio Supreme Court’s decision in Sogg v. Zurz, in which the court ruled that “‘Unclaimed funds’ are not abandoned; they are the property of their owner. Accordingly, the state may not appropriate for its own use, against the owner of the underlying property, interest earned on that property.” California has had its own well-publicized disputes with claimants over the ability to reclaim the full value of abandoned property. It will be interesting (no pun intended) to see if either of these bills progress in the legislature.