House Bill 25-1224 Revised

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 (13.3), 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(13.3), 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, 38-13-202, amend (1); and repeal (3) and (4) as follows:

• Page 6, Line 238-13-202.  When tax-deferred retirement account presumed

• Page 6, Line 3abandoned. (1)  Subject to section 38-13-210, property held in a pension

• Page 6, Line 4account or retirement account that qualifies for tax deferral under the

• Page 6, Line 5income tax laws of the United States is presumed abandoned if it is unclaimed by the apparent owner three years after the later of:

• Page 6, Line 6(a)  The following dates:

• Page 6, Line 7(I)  Except as otherwise provided in subsection (1)(b)(II) of this

• Page 6, Line 8section, the date a second consecutive communication sent by the holder

• Page 6, Line 9by first-class United States mail to the apparent owner is returned to the holder undelivered by the United States postal service; or

• Page 6, Line 10(II)  If the second communication is sent later than thirty days after

• Page 6, Line 11the date the first communication is returned undelivered, the date the first

• Page 6, Line 12communication was returned undelivered by the United States postal service; or

• Page 6, Line 13(b)  The earlier of the following dates:

• Page 6, Line 14(I)  The date the apparent owner becomes seventy and one-half years of age, if reasonably determinable by the holder; or

• Page 6, Line 15(II)  If the federal "Internal Revenue Code of 1986", as amended,

• Page 6, Line 1626 U.S.C. sec. 1 et seq., requires distribution to avoid a tax penalty, two years after the date the holder:

• Page 6, Line 17(A)  Receives confirmation of the death of the apparent owner in the ordinary course of its business; or

• Page 6, Line 18(B)  Confirms the death of the apparent owner under subsection (2)

• Page 6, Line 19of this section it becomes payable or distributable if the owner

• Page 7, Line 1has not accepted the distribution, corresponded in writing

• Page 7, Line 2concerning the distribution, or otherwise indicated an interest

• Page 7, Line 3as evidenced by a memorandum or other record on file with the

• Page 7, Line 4fiduciary of the trust or custodial fund or the administrator of the plan under which the trust or fund is established.

• Page 7, Line 5(3)  If the holder does not send communications to the apparent

• Page 7, Line 6owner of an account described in subsection (1) of this section by

• Page 7, Line 7first-class United States mail, the holder shall attempt to confirm the

• Page 7, Line 8apparent owner's interest in the property by sending the apparent owner

• Page 7, Line 9an electronic-mail communication not later than two years after the

• Page 7, Line 10apparent owner's last indication of interest in the property; except that the

• Page 7, Line 11holder promptly shall attempt to contact the apparent owner by first-class United States mail if:

• Page 7, Line 12(a)  The holder does not have information needed to send the

• Page 7, Line 13apparent owner an electronic-mail communication or the holder believes

• Page 7, Line 14that the apparent owner's electronic-mail address in the holder's records is not valid;

• Page 7, Line 15(b)  The holder receives notification that the electronic-mail communication was not received; or

• Page 7, Line 16(c)  The apparent owner does not respond to the electronic-mail

• Page 7, Line 17communication not later than thirty days after the communication was sent.

• Page 7, Line 18(4)  If first-class United States mail sent under subsection (3) of

• Page 7, Line 19this section is returned to the holder undelivered by the United States

• Page 7, Line 20postal service, the property is presumed abandoned three years after the later of:

• Page 7, Line 21(a)  Except as otherwise provided in subsection (4)(b) of this

• Page 8, Line 1section, the date a second consecutive communication to contact the

• Page 8, Line 2apparent owner sent by first-class United States mail is returned to the holder undelivered;

• Page 8, Line 3(b)  If the second communication is sent later than thirty days after

• Page 8, Line 4the date the first communication is returned undelivered, the date the first communication was returned undelivered; or

• Page 8, Line 5(c)  The date established by subsection (1)(b) of this section.

• Page 8, Line 6SECTION 5.  In Colorado Revised Statutes, 38-13-404, amend (1) introductory portion as follows:

• Page 8, Line 738-13-404.  Retention of records by holder. (1)  A holder

• Page 8, Line 8required to file a report under section 38-13-401 shall retain records for

• Page 8, Line 9ten six years after the later of the date the report was filed or the last date

• Page 8, Line 10a timely report was due to be filed, unless a shorter period is provided by

• Page 8, Line 11rule of the administrator. A holder may satisfy the requirement to retain records under this section through an agent. The records must contain:

• Page 8, Line 12SECTION 6.  In Colorado Revised Statutes, add 38-13-406 as follows:

• Page 8, Line 1338-13-406. Clarification of reporting requirements for

• Page 8, Line 14unclaimed legacy preneed contracts - amount reportable -

• Page 8, Line 15identification of purchaser and beneficiary. (1)  The amount of an

• Page 8, Line 16unclaimed legacy preneed contract that is reportable as

• Page 8, Line 17unclaimed property is the purchase price paid by the contract

• Page 8, Line 18buyer, as defined in section 10-15-102 (5), exclusive of any

• Page 8, Line 19finance charges or late payment fees, less the amount of any

• Page 8, Line 20liquidated damages for nonperformance paid by or on behalf of

• Page 8, Line 21the contract seller, as defined in section 10-15-102 (6), or any

• Page 8, Line 22cancellation fees paid as required by the legacy preneed

• Page 9, Line 1contract, which cancellation fees cannot exceed fifteen

• Page 9, Line 2percent of the purchase price. The contract seller is entitled to

• Page 9, Line 3retain all interest earned on the money paid to purchase the legacy preneed contract.

• Page 9, Line 4(2)  In addition to complying with the other reporting

• Page 9, Line 5requirements set forth in this article 13, in reporting a legacy

• Page 9, Line 6preneed contract to the administrator, the holder shall

• Page 9, Line 7identify by name both the contract buyer, as defined in section 10-15-102 (5), and the legacy preneed contract beneficiary.

• Page 9, Line 8(3)  A holder of a legacy preneed contract who complies

• Page 9, Line 9with the requirements of subsections (1) and (2) of this section

• Page 9, Line 10and satisfies the requirements set forth in section 38-13-604 is

• Page 9, Line 11relived of responsibility arising thereafter with respect to payment or delivery of the property to the administrator.

• Page 9, Line 12SECTION 7.  In Colorado Revised Statutes, 38-13-501, add (3) as follows:

• Page 9, Line 1338-13-501.  Notice to apparent owner by holder. (3)  The

• Page 9, Line 14notice requirements set forth in subsections (1) and (2) of this

• Page 9, Line 15section require notice to the apparent owner of a legacy

• Page 9, Line 16preneed contract notwithstanding the death or presumed death of the contract buyer, as defined in section 10-15-102 (5).

• Page 9, Line 17SECTION 8.  In Colorado Revised Statutes, 38-13-603, add (4.5) as follows:

• Page 9, Line 1838-13-603.  Payment or delivery of property to administrator.

• Page 9, Line 19(4.5) (a)  If property in a report under section 38-13-401 is virtual

• Page 9, Line 20currency, the holder shall liquidate the virtual currency

• Page 9, Line 21within thirty days of filing the report and remit the liquidation

• Page 10, Line 1proceeds to the administrator. The owner shall have no

• Page 10, Line 2recourse against either the holder or the administrator for any gain in value of the virtual currency after liquidation.

• Page 10, Line 3(b)  If a holder cannot liquidate virtual currency and

• Page 10, Line 4cannot otherwise cause virtual currency to be liquidated, the

• Page 10, Line 5holder shall promptly notify the administrator in writing and

• Page 10, Line 6explain the reasons why the virtual currency cannot be

• Page 10, Line 7liquidated. The administrator, in the administrator's absolute and sole discretion, may direct the holder to either:

• Page 10, Line 8(I)  Transfer the virtual currency that cannot be liquidated to a custodian selected by the administrator; or

• Page 10, Line 9(II)  Continue to hold the virtual currency until the

• Page 10, Line 10administrator or the holder determines that the virtual

• Page 10, Line 11currency can be liquidated pursuant to this article 13 or that there is an indication of apparent owner interest.

• Page 10, Line 12SECTION 9.  In Colorado Revised Statutes, 38-13-605, amend

• Page 10, Line 13(1) introductory portion, (2), (3), and (4)(a) introductory portion as follows:

• Page 10, Line 1438-13-605.  Recovery of property by holder from

• Page 10, Line 15administrator. (1)  A holder that pays money to the administrator under

• Page 10, Line 16this article 13 may file a claim for reimbursement from the administrator

• Page 10, Line 17of the amount paid within two years of remitting and reporting the money paid if the holder:

• Page 10, Line 18(2)  If a claim for reimbursement under subsection (1) of this

• Page 10, Line 19section is made for a payment made on a negotiable instrument, including

• Page 10, Line 20a traveler's check, money order, or similar instrument, the holder must

• Page 10, Line 21submit proof that the instrument was presented and that payment was

• Page 11, Line 1made to a person the holder reasonably believed to be entitled to payment.

• Page 11, Line 2The holder may claim reimbursement within two years of remitting

• Page 11, Line 3and reporting the payment even if the payment was made to a person

• Page 11, Line 4whose claim was made after expiration of a period of limitation on the

• Page 11, Line 5owner's right to receive or recover property, whether specified by contract, statute, or court order.

• Page 11, Line 6(3)  If a holder is reimbursed by the administrator under subsection

• Page 11, Line 7(1)(b) of this section, the holder may also recover from the administrator

• Page 11, Line 8income or gain under section 38-13-606 within two years of

• Page 11, Line 9remitting and reporting the money that would have been paid to the

• Page 11, Line 10owner 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 11, Line 11(4) (a)  A holder that delivers property other than money to the

• Page 11, Line 12administrator under this article 13 may file a claim within two years of

• Page 11, Line 13delivering the property for return of the property from the administrator if:

• Page 11, Line 14SECTION 10.  In Colorado Revised Statutes, 38-13-609, amend (3) as follows:

• Page 11, Line 1538-13-609.  Periods of limitation and repose. (3)  The

• Page 11, Line 16administrator shall not commence an action, proceeding, or examination

• Page 11, Line 17with respect to a duty of a holder under this article 13 more than ten six years after the duty arose.

• Page 11, Line 18SECTION 11.  In Colorado Revised Statutes, 38-13-702, amend (2); and add (3) as follows:

• Page 11, Line 1938-13-702.  Disposal of securities - definition. (2)  Except as

• Page 11, Line 20otherwise provided in subsection (3) of this section, the

• Page 11, Line 21administrator shall not sell a security listed on an established stock

• Page 12, Line 1exchange for less than the price prevailing on the exchange at the time of

• Page 12, Line 2sale. The administrator may sell a security not listed on an established exchange by any commercially reasonable method.

• Page 12, Line 3(3) (a)  The administrator may sell a thinly traded

• Page 12, Line 4security that is listed on an established stock exchange for less

• Page 12, Line 5than the price prevailing on the exchange at the time of sale by

• Page 12, Line 6any commercially reasonable method and at any time after the

• Page 12, Line 7three-year period set forth in subsection (1) of this section has

• Page 12, Line 8passed if the administrator determines, in the administrator's

• Page 12, Line 9sole discretion, that there are no buyers for the thinly traded

• Page 12, Line 10security at the price prevailing on the exchange at the time of

• Page 12, Line 11sale. If the administrator determines that the thinly traded

• Page 12, Line 12security has no substantial commercial value or that the costs

• Page 12, Line 13of disposing of it will exceed its value, the administrator may

• Page 12, Line 14return it to the holder or destroy or otherwise dispose of it as authorized by section 38-13-608.

• Page 12, Line 15(b)  As used in this section, unless the context otherwise

• Page 12, Line 16requires, "thinly traded security" means a security that cannot

• Page 12, Line 17be easily sold or exchanged for cash without causing a significant change in the price of the security.

• Page 12, Line 18SECTION 12.  In Colorado Revised Statutes, amend 38-13-902.4 as follows:

• Page 12, Line 1938-13-902.4.  Claim of the state, a county, a municipality, or a

• Page 12, Line 20governmental agency. At any time after property has been paid or

• Page 12, Line 21delivered to the administrator under this article 13, if the administrator

• Page 12, Line 22determines that the state, a county, a municipality, or a state

• Page 12, Line 23governmental agency owns the property, the administrator may issue a

• Page 13, Line 1warrant to or transfer the property to an operating account of the state, the county, the municipality, or the state governmental agency.

• Page 13, Line 2SECTION 13.  In Colorado Revised Statutes, 38-13-904, amend (1) as follows:

• Page 13, Line 338-13-904.  When administrator must honor claim for

• Page 13, Line 4property. (1)  The administrator shall pay or deliver property to a

• Page 13, Line 5claimant under section 38-13-903 if the administrator receives evidence

• Page 13, Line 6sufficient to establish to the satisfaction of the administrator that the

• Page 13, Line 7claimant is the owner of the property. The general assembly

• Page 13, Line 8recognizes and reaffirms that the administrator may require a

• Page 13, Line 9claimant to provide any documents that are necessary to

• Page 13, Line 10establish ownership before making payment, including but not limited to nonpublic or nonredacted documents.

• Page 13, Line 11SECTION 14.  In Colorado Revised Statutes, 38-13-1304, amend (1)(b)(IV) as follows:

• Page 13, Line 1238-13-1304.  Agreements to locate reported property - overbids

• Page 13, Line 13from foreclosure sales. (1)  Notwithstanding any provision of section

• Page 13, Line 1438-13-1303 to the contrary, an agreement to pay compensation to recover

• Page 13, Line 15or assist in recovering an unclaimed overbid transferred to the administrator under section 38-38-111 is:

• Page 13, Line 16(b)  Enforceable if:

• Page 13, Line 17(IV)  The compensation to be paid under the terms of the agreement does not exceed

• Page 13, Line 18(A)  Twenty ten percent of the amount of the overbid if entered

• Page 13, Line 19into at least two years but not more than three years, after the date of the transfer; or

• Page 13, Line 20(B)  Thirty percent of the amount of the overbid if entered into more than three years after the date of the transfer; and

• Page 14, Line 1SECTION 15.  In Colorado Revised Statutes, 38-13-1402, amend (1)(b); and add (1)(b.5) as follows:

• Page 14, Line 238-13-1402.  Confidential information. (1)  Except as otherwise

• Page 14, Line 3provided in this article 13, the following are confidential and exempt from public inspection or disclosure:

• Page 14, Line 4(b)  Reports and records of a holder in possession of the administrator or the administrator's agent; and

• Page 14, Line 5(b.5)  All records, documents, and information submitted

• Page 14, Line 6by a claimant to the administrator or the administrator's agent

• Page 14, Line 7to enable the administrator or the administrator's agent to

• Page 14, Line 8determine whether the claimant is the owner of the property; and

• Page 14, Line 9SECTION 16.  In Colorado Revised Statutes, repeal 38-13-1504 as follows:

• Page 14, Line 1038-13-1504.  Application of article - local government -

• Page 14, Line 11exemption - notice of property.(1)  Except as otherwise provided in this

• Page 14, Line 12section, the provisions of this article 13 do not apply to a local government that is a holder of property if:

• Page 14, Line 13(a)  The local government has a local ordinance or resolution relating to the disposition of property that conflicts with this article 13;

• Page 14, Line 14(b)  The local ordinance or resolution described in subsection

• Page 14, Line 15(1)(a) of this section requires the local government to hold the property

• Page 14, Line 16for the owner for at least five years after the date it is presumed abandoned under section 38-13-201 (1)(j); and

• Page 14, Line 17(c)  The local government provides the administrator with the

• Page 14, Line 18information described in subsection (2) of this section in the same

• Page 15, Line 1electronic format as a holder is required to use to report unclaimed property.

• Page 15, Line 2(2)  To satisfy subsection (1)(c) of this section, a local government

• Page 15, Line 3must provide the administrator with the following information on or before November 1 of each year:

• Page 15, Line 4(a)  An alphabetical list of the owners for whom the local

• Page 15, Line 5government holds property that is presumed abandoned under section 38-13-201 (1)(j); and

• Page 15, Line 6(b)  The value of the abandoned property that the exempt local government holds for each owner.

• Page 15, Line 7(3)  The administrator shall include the information received in

• Page 15, Line 8accordance with subsection (2) of this section, along with a statement that

• Page 15, Line 9a person claiming to be the owner must file a claim for the property with

• Page 15, Line 10the specific local government that has the property, as part of the website or database maintained under section 38-13-503 (3).

• Page 15, Line 11SECTION 17.  Safety clause. The general assembly finds,

• Page 15, Line 12determines, and declares that this act is necessary for the immediate

• Page 15, Line 13preservation of the public peace, health, or safety or for appropriations for

• Page 15, Line 14the support and maintenance of the departments of the state and state institutions.