Senate creates unclaimed property trust fund and clears constitutional ballot question option

Senators passed a pair of measures on Feb. 20, 2025 to change how the state handles unclaimed property: Senate Bill 155 will create an Unclaimed Property Trust Fund and Senate Joint Resolution 505 (as amended) will refer a constitutional amendment to voters to allow the trust to be invested consistent with other state trust funds.

Supporters said the two measures together turn an unfunded liability into a long-term asset that can generate investment returns for the benefit of the state and its citizens. The bill passed the Senate by a unanimous vote of 35-0; the joint resolution likewise passed 35-0 and will appear on the next general election ballot if the full legislative process continues.

Senator Howard, sponsor of the bill creating the trust fund, said the legislation will reduce the amount of unclaimed property revenue deposited directly into the general fund and instead place the remainder into a new trust. "Starting in fiscal year '26, we will start with roughly 62,000,000 that will go into the general fund, the remainder into the trust fund," Howard said on the floor. Howard and other sponsors described a 10-year glide path that would reduce the portion going to the general fund to $25,000,000 annually while the rest builds the trust.

Senator Bill Harrower and several other senators praised the bill’s fiscal clarity. Harrower said the shift remedies the problem of treating unclaimed property as revenue the state can spend while remaining liable in perpetuity for rightful claims. Senator Carr told colleagues the measure was the product of bipartisan negotiation and said it would be something lawmakers could be proud of in years to come.

On the joint resolution (SJR 505), Senator Howard moved an amendment to allow invasion of principal under the same conditions as other trust funds — a three-fourths vote of both chambers — bringing the proposed constitutional language in line with existing trust-fund practice. He told the Senate the amendment harmonizes the measure with the state’s Investment Council practice and would permit the trust to earn investment returns rather than sit in cash-flow accounts.

Senators who spoke urged colleagues to educate constituents ahead of the general election, noting that constitutional amendments require voter approval. One senator observed that enabling investment could increase long-term returns significantly compared with leaving funds in cash accounts.

Background and fiscal details: Senators described a large and growing unclaimed-property balance that previously had been recorded and spent as general fund revenue. The new trust is intended to provide a dedicated reserve to pay future claims while preserving a durable asset for state programs. The floor discussion referenced participation by the Bureau of Finance and Management, the state treasurer’s office, the state Investment Council and legislative sponsors from both chambers in negotiating the package.

Next steps: Senate Bill 155 will proceed to the House for further consideration. The joint resolution requires enactment by the legislature and then voter approval at the next general election to take effect.