Today's Law As Amended


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AB-1011 Unclaimed property: interest payment.(2013-2014)



As Amends the Law Today


SECTION 1.

 Section 1540 of the Code of Civil Procedure is amended to read:

1540.
 (a) Any person, excluding another state, who claims to have been the owner, as defined in subdivision (d), of  an interest in  property paid or delivered to the Controller under this chapter may file a claim to the property or to the net proceeds from its sale. The claim shall be on a form prescribed by the Controller and shall be verified by the claimant.
(b) The Controller shall consider each claim within 180 days after it is filed to determine if the claimant is the owner, as defined in subdivision (d),  and may hold a hearing and receive evidence. The Controller shall give written notice to the claimant if the Controller  he or she  denies the claim in whole or in part. The notice may be given by mailing it to the address, if any, stated in the claim as the address to which notices are to be sent. If no address is stated in the claim, the notice may be mailed to the address, if any, of the claimant as stated in the claim. A No  notice of denial need not  be given if the claim fails to state either an address to which notices are to be sent or an address of the claimant.
(c) Interest (1)   shall not be payable on  The Controller shall add interest at the rate of 5 percent per year or the bond equivalent rate of 13-week United States Treasury bills, whichever is lower, to the amount of  any claim paid under this chapter. the owner under this section for the period the property was on deposit in the Unclaimed Property Fund. No interest shall be payable for any period prior to January 1, 2014. Any interest required to be paid by the state pursuant to this section shall be computed as simple interest, not as compound interest.  
(2) For purposes of this section, the bond equivalent rate of 13-week United States Treasury bills shall be defined in accordance with the following criteria:
(A) The bond equivalent rate of 13-week United States Treasury bills established at the first auction held during the month of January shall apply for the following July 1 to December 31, inclusive.
(B) The bond equivalent rate of 13-week United States Treasury bills established at the first auction held during the month of July shall apply for the following January 1 to June 30, inclusive.
(d) A former holder of property, who, pursuant to subdivision (b) of Section 1560, compensates the owner of property that has escheated and been remitted to the state, shall also pay interest as provided in subdivision (c) in addition to the value of the property. Upon payment of the principal and interest pursuant to this subdivision, the owner shall be deemed to have forfeited his or her interest in the escheated property and the former holder may seek and receive reimbursement from the Controller in the amount that the former holder paid to the owner of the escheated property. The request for reimbursement must be properly submitted in the form prescribed by the Controller.
(d) (e)  Notwithstanding subdivision (g) of Section 1501, for purposes of filing a claim pursuant to  For the purposes of  this section, “owner” means the person who had legal right to the property before  prior to  its escheat, the person’s heirs or estate representative, the person’s guardian or conservator, his or her heirs, his or her legal representative,  or a public administrator acting pursuant to the authority granted in Sections 7660 and 7661 of the Probate Code. An “owner” also means a nonprofit civic, charitable, or educational organization that granted a charter, sponsorship, or approval for the existence of the organization that had the legal right to the property before its escheat but that has dissolved or is no longer in existence, if the charter, sponsorship, approval, organization bylaws, or other governing documents provide that unclaimed or surplus property shall be conveyed to the granting organization upon dissolution or cessation to exist as a distinct legal entity. Only an owner, as defined in this subdivision, may file a claim with the Controller pursuant to this article. 
(e) (f)  Following a public hearing, the Controller shall adopt guidelines and forms that shall provide specific instructions to assist owners in filing claims pursuant to this article.
(f) Notwithstanding any other provision, property reported to, and received by, the Controller pursuant to this chapter in the name of a state agency, including the University of California and the California State University, or local agency, may be transferred by the Controller directly to the state or local agency without the filing of a claim. Property transferred pursuant to this subdivision is immune from suit pursuant to Section 1566 in the same manner as if the state or local agency had filed a claim to the property. For purposes of this subdivision, “local agency” means a city, county, city and county, or district.

SEC. 2.

 Section 12419.8 of the Government Code is amended to read:

12419.8.
 (a) The Controller may, in his or her discretion, offset any amount due a city, county, or special district  city or county  from a person or entity pursuant to paragraph (1), (2), or (4) of subdivision (c), and shall, at the request of the city, county, or special district,  city or county,  offset any amount due a city, county, or special district  city or county  from a person or entity pursuant to paragraph (3) of subdivision (c), against any amount owing the person or entity by a state agency on a claim for a refund from the Franchise Tax Board under the Personal Income Tax Law or the Bank and Corporation Tax Law, a claim for refund from the State Board of Equalization under the Sales and Use Tax Law, from winnings in the California State Lottery, or a claim filed by the owner, as described in subdivision (d) (e)  of Section 1540 of the Code of Civil Procedure, for payment of money from unclaimed property held by the state. Standards and procedures for submission of requests for offsets shall be as prescribed by the Controller. Whenever insufficient funds are available to satisfy an offset request, the Controller, after first applying the amounts available to any amount due a state agency, may allocate the balance among any other requests for offset.
(b) The Controller shall deduct and retain from any amount offset in favor of a city, county, or special district  city or county  an amount sufficient to reimburse the Controller, the Franchise Tax Board, the State Board of Equalization, or the California State Lottery for their administrative costs of processing the offset payment.
(c) This section shall apply only to any of the following situations:
(1) Where the amount has been reduced to a judgment.
(2) Where the amount is contained in an order of a court.
(3) Where the amount is from a bench warrant for payment of any fine, penalty, or assessment.
(4) Where the amount is delinquent unsecured property taxes on which a certificate lien has been filed for record in the office of the county recorder pursuant to Section 2191.3 of the Revenue and Taxation Code.
(d) For purposes of paragraph (4) of subdivision (c):
(1) Upon the tax collector’s request for taxpayer identification numbers required by the Controller’s procedures, the tax collector shall immediately notify the appropriate assessee, by registered or certified mail, that the request has been made for the purpose of intercepting refunds from the state government due the taxpayer, in order to offset the delinquent property tax obligation. The letter shall state that if the assessee does not pay the outstanding tax amount to the tax collector within 20 days, the required taxpayer identification number will be so provided.
(2) The tax collector shall not be named in any action that may be brought as a result of compliance with this subdivision.