|
BILL # HB 2623 |
TITLE: |
|
SPONSOR: Biasiucci |
STATUS: As Amended by Senate APPROP |
|
PREPARED BY: Micaela Larkin |
|
HB 2623 makes changes to the Department of Revenue's (DOR)'s responsibilities for unclaimed property. The bill establishes a registration fee for locators of unclaimed property. The bill directs DOR to provide data in a searchable electronic or digital format to the locators.
Estimated Impact
We estimate that by expanding opportunities for unclaimed property locators to find owners of unclaimed property, the bill will increase the amount of unclaimed property returned to owners. This will, in turn, reduce the amount of unclaimed property proceeds that is deposited into the General Fund. The magnitude of the General Fund revenue reduction will depend on the impact of the locators on the return rate.
We assume that DOR's administrative costs will be covered by the registration fee and renewal fee that locators will pay.
We have not yet received DOR's estimate of the fiscal impact of the legislation.
Analysis
The state holds the unclaimed property in custody for up to 35 years and tries to return to the owner. Under current law, finders assist owners with claiming unclaimed property and may charge a fee of up to 30% of the value of recovered property held by DOR for more than 24 months. The bill establishes locators in statute, sets out requirements for such locators, and permits registered locators to receive unclaimed property account information for all unclaimed accounts as outlined in the bill. We assume that DOR will set the registration and renewal fees at a level sufficient to offset its annual costs.
This analysis assumes that locator entities are incentivized to find owners of unclaimed property and will increase the amount of returned property by contacting and signing up owners as clients or motivating owners to submit a claim. The amount of unclaimed property returned to owners in a year compared to current returns or the amount of refund claims processed by DOR, however, cannot be predicted in advance.
Statute directs the unclaimed property to different statutory recipients and the remainder to the General Fund. In FY 2022, DOR returned $47.0 million, or 21.5% of $218.1 million in unclaimed property. DOR transferred $124.0 million to the General Fund in FY 2022.
There may also be additional costs or operational changes associated with implementing the bill's changes to the unclaimed property confidentiality statute and the provision directing DOR to provide the unclaimed property data in a searchable electronic or digital format to the locators. We do not have an estimate for any such possible costs.
(Continued)
Local Government Impact
None
4/24/23