House Bill 25-1224 Introduced

A Bill for an Act

• Page 1, Line 101Concerning modification of the "Revised Uniform Unclaimed

• Page 1, Line 102Property Act".

Bill Summary

(Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://leg.colorado.gov.)

The bill modifies the "Revised Uniform Unclaimed Property Act" (RUUPA) as follows:

• Sections 1, 2, 5, and 6 clarify the treatment under RUUPA of legacy preneed contracts, which are preneed contracts for funeral services entered into before August 10, 2022;
• Sections 2, 3, and 7 modify the definition of virtual currency, specify that virtual currency is presumed abandoned 3 years after the latest indication of interest by its apparent owner of the virtual currency, requires a holder of unclaimed property that is reporting unclaimed virtual currency to the state treasurer (administrator) to liquidate the virtual currency within 30 days of filing the report and remit the liquidation proceeds to the administrator, and specifies that the owner of the virtual currency has no recourse against either the holder or the administrator for any gain in value of the virtual currency after liquidation;
• Section 4 shortens the period for which a holder required to file must retain records from 10 to 6 years;
• Section 8 requires a holder that pays money to the administrator to file a claim for reimbursement from the administrator of the amount paid within 2 years of remitting and reporting the money paid;
• Section 9 reduces the amount of time after a duty of a holder of unclaimed property arises that the administrator has to commence an action, proceeding, or examination with respect to the duty from 10 years to 6 years;
• Section 10 clarifies the authority of the administrator with respect to the sale or other disposition of unclaimed thinly traded securities;
• If the administrator determines that a county or a municipality owns unclaimed property in the possession of the administrator, section 11 authorizesthe administrator to issue a warrant to or transfer the property to an operating account of the county or the municipality;
• Section 12 authorizes the administrator to require a person making a claim for unclaimed property to supply nonpublic and nonredacted documents to prove ownership of the property;
• Section 13 reduces the maximum amount of compensation allowed to be paid under an agreement to recover or assist in recovering an unclaimed overbid transferred to the administrator from either 30% or 20% of the amount of the overbid depending on when the agreement is entered into to 10% of the amount of overbid without regard to when the agreement was entered into; and
• Section 14 repeals a statutory exemption from RUUPA for a local government that is a holder of property and satisfies specified conditions because few local governments have met the specified conditions.

• Page 3, Line 1Be it enacted by the General Assembly of the State of Colorado:

• Page 3, Line 2SECTION 1.  In Colorado Revised Statutes, 10-15-111.7, amend (2) introductory portion and (3) as follows:

• Page 3, Line 310-15-111.7.  Disposition of unclaimed preneed funeral

• Page 3, Line 4contracts - unclaimed property trust fund. (2)  Except as otherwise

• Page 3, Line 5specified in section 38-13-201 (1)(m) for a legacy preneed

• Page 3, Line 6contract, as defined in section 38-13-102 (13.5), a preneed contract for funeral services is unclaimed at the earlier of the following:

• Page 3, Line 7(3)  Except as otherwise specified in section 38-13-406 (1)

• Page 3, Line 8for a legacy preneed contract, as defined in section 38-13-102

• Page 3, Line 9(13.5), for purposes of this section, the amount reportable for an

• Page 3, Line 10unclaimed preneed contract is the amount paid by the purchaser

• Page 3, Line 11contract buyer to the contract seller, less selling costs not to exceed

• Page 3, Line 12fifteen percent of the total preneed contract price, liquidated damages, and contractual offsets, as authorized by law.

• Page 3, Line 13SECTION 2.  In Colorado Revised Statutes, 38-13-102, amend

• Page 3, Line 14(32) introductory portion, (32)(c), and (32)(d); and add (5.5), (13.3), (13.5), and (32)(e) as follows:

• Page 3, Line 1538-13-102.  Definitions. As used in this article 13, unless the context otherwise requires:

• Page 3, Line 16(5.5)  "Cryptocurrency" means a digital currency in which

• Page 3, Line 17transactions are verified and records are maintained by a

• Page 3, Line 18decentralized system using a blockchain rather than by a centralized authority.

• Page 3, Line 19(13.3)  "Legacy preneed contract" means a preneed

• Page 3, Line 20contract, as defined in section 10-15-102 (13), including both a

• Page 4, Line 1preneed contract for funeral merchandise and services and a

• Page 4, Line 2preneed contract for cemetery merchandise and services, that was entered into before August 10, 2022.

• Page 4, Line 3(13.5)  "Legacy preneed contract beneficiary" means, for

• Page 4, Line 4any legacy preneed contract entered into on or after July 1,

• Page 4, Line 51967, any person specified in the legacy preneed contract upon

• Page 4, Line 6whose death a final resting place, merchandise, as defined in

• Page 4, Line 7section 10-15-102 (1), or services, as defined in section 10-15-102 (16), shall be provided, delivered, or performed.

• Page 4, Line 8(32)  "Virtual currency" means a any type of digital

• Page 4, Line 9representation of value, including cryptocurrency, that is used as

• Page 4, Line 10a medium of exchange, unit of account, or a store of value, but that does

• Page 4, Line 11not have legal tender status as recognized by the United States. The term does not include:

• Page 4, Line 12(c)  A loyalty card; or

• (d)  A financial organization loyalty card; or

• Page 4, Line 13(e)  A gift card.

• Page 4, Line 14SECTION 3.  In Colorado Revised Statutes, 38-13-201, amend (1)(l) and (1)(m); and add (1)(l.5) as follows:

• Page 4, Line 1538-13-201.  When property presumed abandoned. (1)  Subject

• Page 4, Line 16to section 38-13-210, the following property is presumed abandoned if it

• Page 4, Line 17is unclaimed by the apparent owner during the period specified in this section:

• Page 4, Line 18(l)  Except as otherwise provided for unclaimed utility deposits

• Page 4, Line 19under section 40-8.5-106, a deposit or refund owed to a subscriber by a utility, one year after the deposit or refund becomes payable; and

• Page 4, Line 20(l.5)  Any virtual currency held or owing by any banking

• Page 5, Line 1organization, corporation, custodian, exchange, or other entity

• Page 5, Line 2engaged in virtual currency business activity, three years after

• Page 5, Line 3the latest indication of interest in the property, as described in

• Page 5, Line 4section 38-13-210 (2), by the apparent owner of the virtual currency; and

• Page 5, Line 5(m) (I)  All other property not specified in this section or sections

• Page 5, Line 638-13-202 to 38-13-208 and 38-13-213 to 38-13-220, including the

• Page 5, Line 7reportable amount of a legacy preneed contract as set forth in

• Page 5, Line 8section 38-13-406 (1), the earlier of three years after the owner first has

• Page 5, Line 9a right to demand the property or the obligation to pay or distribute the property arises.

• Page 5, Line 10(II)  For purposes of subsection (1)(m)(I) of this section and

• Page 5, Line 11notwithstanding section 10-15-111.7 (2), the owner of a legacy

• Page 5, Line 12preneed contract first has a right to demand the property, the

• Page 5, Line 13obligation to pay or distribute the property arises, and the

• Page 5, Line 14three-year presumptive abandonment period for the legacy preneed contract commences on the earlier of:

• Page 5, Line 15(A)  The confirmed date of death of the legacy preneed contract beneficiary; or

• Page 5, Line 16(B)  In the absence of knowledge of the death of the

• Page 5, Line 17legacy preneed contract beneficiary, the presumed date of

• Page 5, Line 18death, which is the date on which the legacy preneed contract

• Page 5, Line 19beneficiary reaches one hundred seven years of age. The date of

• Page 5, Line 20death of the legacy preneed contract beneficiary can be

• Page 5, Line 21obtained through any source, including a declaration of death,

• Page 5, Line 22a death certificate, the United States social security

• Page 5, Line 23administration or other governmental death records, or other equivalent resource.

• Page 6, Line 1SECTION 4.  In Colorado Revised Statutes, 38-13-404, amend (1) introductory portion as follows:

• Page 6, Line 238-13-404.  Retention of records by holder. (1)  A holder

• Page 6, Line 3required to file a report under section 38-13-401 shall retain records for

• Page 6, Line 4ten six years after the later of the date the report was filed or the last date

• Page 6, Line 5a timely report was due to be filed, unless a shorter period is provided by

• Page 6, Line 6rule of the administrator. A holder may satisfy the requirement to retain records under this section through an agent. The records must contain:

• Page 6, Line 7SECTION 5.  In Colorado Revised Statutes, add 38-13-406 as follows:

• Page 6, Line 838-13-406. Clarification of reporting requirements for

• Page 6, Line 9unclaimed legacy preneed contracts - amount reportable -

• Page 6, Line 10identification of purchaser and beneficiary. (1)  The amount of an

• Page 6, Line 11unclaimed legacy preneed contract that is reportable as

• Page 6, Line 12unclaimed property is the purchase price paid by the contract

• Page 6, Line 13buyer, as defined in section 10-15-102 (5), exclusive of any

• Page 6, Line 14finance charges or late payment fees, less the amount of any

• Page 6, Line 15liquidated damages for nonperformance paid by or on behalf of

• Page 6, Line 16the contract seller, as defined in section 10-15-102 (6), or any

• Page 6, Line 17cancellation fees paid as required by the legacy preneed

• Page 6, Line 18contract, which cancellation fees cannot exceed fifteen

• Page 6, Line 19percent of the purchase price. The contract seller is entitled to

• Page 6, Line 20retain all interest earned on the money paid to purchase the legacy preneed contract.

• Page 6, Line 21(2)  In addition to complying with the other reporting

• Page 6, Line 22requirements set forth in this article 13, in reporting a legacy

• Page 7, Line 1preneed contract to the administrator, the holder shall

• Page 7, Line 2identify by name both the contract buyer, as defined in section 10-15-102 (5), and the legacy preneed contract beneficiary.

• Page 7, Line 3(3)  A holder of a legacy preneed contract who complies

• Page 7, Line 4with the requirements of subsections (1) and (2) of this section

• Page 7, Line 5and satisfies the requirements set forth in section 38-13-604 is

• Page 7, Line 6relived of responsibility arising thereafter with respect to payment or delivery of the property to the administrator.

• Page 7, Line 7SECTION 6.  In Colorado Revised Statutes, 38-13-501, add (3) as follows:

• Page 7, Line 838-13-501.  Notice to apparent owner by holder. (3)  The

• Page 7, Line 9notice requirements set forth in subsections (1) and (2) of this

• Page 7, Line 10section require notice to the apparent owner of a legacy

• Page 7, Line 11preneed contract notwithstanding the death or presumed death of the contract buyer, as defined in section 10-15-102 (5).

• Page 7, Line 12SECTION 7.  In Colorado Revised Statutes, 38-13-603, add (4.5) as follows:

• Page 7, Line 1338-13-603.  Payment or delivery of property to administrator.

• Page 7, Line 14(4.5)  If property in a report under section 38-13-401 is virtual

• Page 7, Line 15currency, the holder shall liquidate the virtual currency

• Page 7, Line 16within thirty days of filing the report and remit the liquidation

• Page 7, Line 17proceeds to the administrator. The owner shall have no

• Page 7, Line 18recourse against either the holder or the administrator for any gain in value of the virtual currency after liquidation.

• Page 7, Line 19SECTION 8.  In Colorado Revised Statutes, 38-13-605, amend

• Page 7, Line 20(1) introductory portion, (2), (3), and (4)(a) introductory portion as

• Page 7, Line 21follows:

• Page 8, Line 138-13-605.  Recovery of property by holder from

• Page 8, Line 2administrator. (1)  A holder that pays money to the administrator under

• Page 8, Line 3this article 13 may file a claim for reimbursement from the administrator

• Page 8, Line 4of the amount paid within two years of remitting and reporting the money paid if the holder:

• Page 8, Line 5(2)  If a claim for reimbursement under subsection (1) of this

• Page 8, Line 6section is made for a payment made on a negotiable instrument, including

• Page 8, Line 7a traveler's check, money order, or similar instrument, the holder must

• Page 8, Line 8submit proof that the instrument was presented and that payment was

• Page 8, Line 9made to a person the holder reasonably believed to be entitled to payment.

• Page 8, Line 10The holder may claim reimbursement within two years of remitting

• Page 8, Line 11and reporting the payment even if the payment was made to a person

• Page 8, Line 12whose claim was made after expiration of a period of limitation on the

• Page 8, Line 13owner's right to receive or recover property, whether specified by contract, statute, or court order.

• Page 8, Line 14(3)  If a holder is reimbursed by the administrator under subsection

• Page 8, Line 15(1)(b) of this section, the holder may also recover from the administrator

• Page 8, Line 16income or gain under section 38-13-606 within two years of

• Page 8, Line 17remitting and reporting the money that would have been paid to the

• Page 8, Line 18owner if the money had been claimed from the administrator by the owner to the extent the income or gain was paid by the holder to the owner.

• Page 8, Line 19(4) (a)  A holder that delivers property other than money to the

• Page 8, Line 20administrator under this article 13 may file a claim within two years of

• Page 8, Line 21delivering the property for return of the property from the administrator if:

• Page 8, Line 22SECTION 9.  In Colorado Revised Statutes, 38-13-609, amend

• Page 8, Line 23(3) as follows:

• Page 9, Line 138-13-609.  Periods of limitation and repose. (3)  The

• Page 9, Line 2administrator shall not commence an action, proceeding, or examination

• Page 9, Line 3with respect to a duty of a holder under this article 13 more than ten six years after the duty arose.

• Page 9, Line 4SECTION 10.  In Colorado Revised Statutes, 38-13-702, amend (2); and add (3) as follows:

• Page 9, Line 538-13-702.  Disposal of securities - definition. (2)  Except as

• Page 9, Line 6otherwise provided in subsection (3) of this section, the

• Page 9, Line 7administrator shall not sell a security listed on an established stock

• Page 9, Line 8exchange for less than the price prevailing on the exchange at the time of

• Page 9, Line 9sale. The administrator may sell a security not listed on an established exchange by any commercially reasonable method.

• Page 9, Line 10(3) (a)  The administrator may sell a thinly traded

• Page 9, Line 11security that is listed on an established stock exchange for less

• Page 9, Line 12than the price prevailing on the exchange at the time of sale by

• Page 9, Line 13any commercially reasonable method and at any time after the

• Page 9, Line 14three-year period set forth in subsection (1) of this section has

• Page 9, Line 15passed if the administrator determines, in the administrator's

• Page 9, Line 16sole discretion, that there are no buyers for the thinly traded

• Page 9, Line 17security at the price prevailing on the exchange at the time of

• Page 9, Line 18sale. If the administrator determines that the thinly traded

• Page 9, Line 19security has no substantial commercial value or that the costs

• Page 9, Line 20of disposing of it will exceed its value, the administrator may

• Page 9, Line 21return it to the holder or destroy or otherwise dispose of it as authorized by section 38-13-608.

• Page 9, Line 22(b)  As used in this section, unless the context otherwise

• Page 9, Line 23requires, "thinly traded security" means a security that cannot

• Page 10, Line 1be easily sold or exchanged for cash without causing a significant change in the price of the security.

• Page 10, Line 2SECTION 11.  In Colorado Revised Statutes, amend 38-13-902.4 as follows:

• Page 10, Line 338-13-902.4.  Claim of the state, a county, a municipality, or a

• Page 10, Line 4governmental agency. At any time after property has been paid or

• Page 10, Line 5delivered to the administrator under this article 13, if the administrator

• Page 10, Line 6determines that the state, a county, a municipality, or a state

• Page 10, Line 7governmental agency owns the property, the administrator may issue a

• Page 10, Line 8warrant to or transfer the property to an operating account of the state, the county, the municipality, or the state governmental agency.

• Page 10, Line 9SECTION 12.  In Colorado Revised Statutes, 38-13-904, amend (1) as follows:

• Page 10, Line 1038-13-904.  When administrator must honor claim for

• Page 10, Line 11property. (1)  The administrator shall pay or deliver property to a

• Page 10, Line 12claimant under section 38-13-903 if the administrator receives evidence

• Page 10, Line 13sufficient to establish to the satisfaction of the administrator that the

• Page 10, Line 14claimant is the owner of the property. The administrator may require

• Page 10, Line 15the claimant to provide nonpublic or nonredacted documents to establish ownership before making payment.

• Page 10, Line 16SECTION 13.  In Colorado Revised Statutes, 38-13-1304, amend (1)(b)(IV) as follows:

• Page 10, Line 1738-13-1304.  Agreements to locate reported property - overbids

• Page 10, Line 18from foreclosure sales. (1)  Notwithstanding any provision of section

• Page 10, Line 1938-13-1303 to the contrary, an agreement to pay compensation to recover

• Page 10, Line 20or assist in recovering an unclaimed overbid transferred to the

• Page 10, Line 21administrator under section 38-38-111 is:

• (b)  Enforceable if:

• Page 11, Line 1(IV)  The compensation to be paid under the terms of the agreement does not exceed

• Page 11, Line 2(A)  Twenty ten percent of the amount of the overbid if entered

• Page 11, Line 3into at least two years but not more than three years, after the date of the transfer; or

• Page 11, Line 4(B)  Thirty percent of the amount of the overbid if entered into more than three years after the date of the transfer; and

• Page 11, Line 5SECTION 14.  In Colorado Revised Statutes, repeal 38-13-1504 as follows:

• Page 11, Line 638-13-1504.  Application of article - local government -

• Page 11, Line 7exemption - notice of property.(1)  Except as otherwise provided in this

• Page 11, Line 8section, the provisions of this article 13 do not apply to a local government that is a holder of property if:

• Page 11, Line 9(a)  The local government has a local ordinance or resolution relating to the disposition of property that conflicts with this article 13;

• Page 11, Line 10(b)  The local ordinance or resolution described in subsection

• Page 11, Line 11(1)(a) of this section requires the local government to hold the property

• Page 11, Line 12for the owner for at least five years after the date it is presumed abandoned under section 38-13-201 (1)(j); and

• Page 11, Line 13(c)  The local government provides the administrator with the

• Page 11, Line 14information described in subsection (2) of this section in the same

• Page 11, Line 15electronic format as a holder is required to use to report unclaimed property.

• Page 11, Line 16(2)  To satisfy subsection (1)(c) of this section, a local government

• Page 11, Line 17must provide the administrator with the following information on or

• Page 11, Line 18before November 1 of each year:

• Page 12, Line 1(a)  An alphabetical list of the owners for whom the local

• Page 12, Line 2government holds property that is presumed abandoned under section 38-13-201 (1)(j); and

• Page 12, Line 3(b)  The value of the abandoned property that the exempt local government holds for each owner.

• Page 12, Line 4(3)  The administrator shall include the information received in

• Page 12, Line 5accordance with subsection (2) of this section, along with a statement that

• Page 12, Line 6a person claiming to be the owner must file a claim for the property with

• Page 12, Line 7the specific local government that has the property, as part of the website or database maintained under section 38-13-503 (3).

• Page 12, Line 8SECTION 15.  Safety clause. The general assembly finds,

• Page 12, Line 9determines, and declares that this act is necessary for the immediate

• Page 12, Line 10preservation of the public peace, health, or safety or for appropriations for

• Page 12, Line 11the support and maintenance of the departments of the state and state institutions.