Legislative Analysis
Phone: (517) 373-8080
DORMANCY PERIODS FOR UNCLAIMED PROPERTY
http://www.house.mi.gov/hfa
OF ACTIVE-DUTY MILITARY PERSONNEL
Analysis available at
Senate Bills 388 and 389 (S-1) as reported from House committee http://www.legislature.mi.gov
Sponsor: Sen. Veronica Klinefelt
1st House Committee: Insurance and Financial Services
2nd House Committee: Military, Veterans and Homeland Security
Senate Committee: Veterans and Emergency Services
Complete to 2-12-24
(Enacted as Public Acts 100 and 101 of 2024)
SUMMARY:
Senate Bills 388 and 389 would change dormancy periods for certain kinds of unclaimed
property owned by active-duty members of the armed forces and reserves. The bills would
extend, from three years to five, dormancy periods that now apply to certain kinds of property
owned by an individual on active orders in the reserve component of the armed forces. Most
of these five-year dormancy periods already now apply under the act to property owned by an
individual on active duty military service (not including the reserves), and they would continue
to do so under the bills. In a few other cases, though, the bills would shorten the dormancy
periods that now apply to property owned by those individuals.
The Uniform Unclaimed Property Act, enacted in 1995, replaced the 1947 Michigan Code
of Escheats with a model uniform act that was developed by the National Conference on
Uniform State Laws (also known as the Uniform Law Commission, or ULC).1 Adoption of the
uniform act was intended to simplify and streamline Michigan’s process for unclaimed
property, while also promoting uniformity with the system used in other states. Reportedly, 27
other states had adopted the uniform law by 1995. 2
Under the act, generally speaking, if an owner of property does not take any action on that
property for a specified continuous number of years (in most cases, three years), the property
is considered abandoned and is transferred (“escheated”) to the state, which becomes its legal
custodian. 3 The state maintains unclaimed property or its equivalent value for property owners
in perpetuity—owners or heirs always have the right to claim the property. 4 The dormancy
period is how long property can be continuously inactive or unclaimed before it is presumed
to be abandoned and is escheated to the state. A dormancy period generally starts on the date
of the last contact by the owner with the holder of the property (called the “dormancy date” or
“date of last activity”). 5
1
Section 4 of Article X of the state constitution requires procedures for escheated property to be prescribed by law.
The ULC website is here: https://www.uniformlaws.org/home
2
https://www.legislature.mi.gov/documents/1995-1996/billanalysis/Senate/pdf/1995-SFA-0390-E.pdf
3
Many different types of property can be escheated, such as inheritances with no known heir, inactive bank accounts,
insurance benefits, money orders, travelers checks, unused gift cards, refund checks, payroll checks, the contents of
safe deposit boxes. What constitutes an action taken by an owner indicating their interest in that property is specified
in law and might include, for example, making a deposit or withdrawal, sending a written memorandum to the holder
of the property, or claiming the property outright.
4
See https://unclaimedproperty.michigan.gov/
5
See https://unclaimedproperty.michigan.gov/docs/MI_2023_Manual_for_Reporting_Unclaimed_Property.pdf
Appendix A, on page 36, lists types of property and their applicable dormancy periods under current law.
House Fiscal Agency Page 1 of 4
 Public Act 197 of 2010 amended the act to shorten the dormancy period for most kinds of
unclaimed property to three years, from previous statutory lengths of five, seven, or 15 years.6
However, language was also included to provide that the changes made to dormancy periods
by 2010 PA 197 did not apply if the owner of the property was on active duty military service
outside the United States. (In 2020, the “outside the United States” requirement was removed.7)
This means that, for applicable property owned by individuals on active duty military service
as described above, the dormancy periods for unclaimed property are set at five, seven, or 15
years—whatever they were before the changes made by the 2010 act.
Senate Bill 389 would amend the Uniform Unclaimed Property Act to eliminate the provision
described above that exempts property owned by active-duty servicemembers from all of the
dormancy period changes made by 2010 PA 197. In place of that provision, the bill would list
several sections of the act that now prescribe three-year dormancy periods for different kinds
of property. Under the bill, for an owner of property who is on active duty military service or
in the reserve component on active orders, those periods would be five years instead of three.
The exemption from the three-year dormancy periods enacted by 2010 PA 197 does not now
apply to property owned by individuals in the reserves, so the bill would thus increase, from
three years to five, the dormancy periods that apply to that property.
For property owned by individuals on active duty military service, the dormancy periods that
now apply are those that were in effect before enactment of 2010 PA 197. In most cases, the
three-year dormancy periods listed in the bill were five-year periods before 2010, so the bill’s
provision of a five-year period for those kinds of unclaimed property owned by individuals on
active duty would be the same as the five-year period that now applies.
However, not all of the dormancy periods for property owned by active-duty servicemembers
are currently set at five years. The dormancy period that applies to any sum payable on an
outstanding money order or similar written instrument, other than a third-party bank check, is
now seven years if the owner is on active duty military service. The bill’s change to a five-year
period would thus, in this case, be a reduction.
Similarly, the dormancy period for the following types of accounts is currently 15 years (and
under the bill would be five years) if the owner is an individual on active duty military service:
• An account in trust described in section 2 of 1909 PA 248. 8
• An account established under the Michigan Uniform Transfers to Minors Act (or under
its predecessor act, the Michigan Uniform Gifts to Minors Act). 9
The table below shows the types of property the bill would apply to and the applicable
dormancy periods for owners of property on active duty military service or on active orders in
the reserves under both current law and the bill.
6
http://legislature.mi.gov/doc.aspx?2010-HB-6421
7
http://legislature.mi.gov/doc.aspx?2019-SB-0125
8
http://legislature.mi.gov/doc.aspx?mcl-487-702
9
The Michigan Uniform Gifts to Minors Act, enacted in 1959, was repealed and replaced in 1998 by the Michigan
Uniform Transfers to Minors Act. The bill would update references to the acts accordingly. For a description of the
1998 changes: https://www.legislature.mi.gov/documents/1997-1998/billanalysis/House/pdf/1997-HLA-5643-A.pdf
House Fiscal Agency SBs 388 and 389 (S-1) as reported Page 2 of 4
 Provision Property type Dormancy period
Current law Current law: SB 389: Active duty
and SB 389: Active duty military and reserves
Generally military on active orders
Section 3(1) Property held, issued, or owing in the ordinary course of a 3 years 5 years 5 years
holder's business, including any income or increment
derived from it, less any lawful charges
Section 5(2) Amount payable on an outstanding money order or similar 3 years 7 years 5 years
instrument, except a third party bank check
Section 6(1) Amount payable on an outstanding check, draft, or similar 3 years 5 years 5 years
instrument (except those under section 5) on which a
banking or financial organization is directly liable,
including a cashier's check or certified check
Section 7(1) A demand, savings, or matured time deposit with a 3 years 5 years 5 years
banking or financial organization, including a deposit that
is automatically renewable, and any funds paid toward a
share, a mutual investment certificate, or any other interest
in such an organization
Section 7(5) An in trust for account under section 2 of 1909 PA 248 or 3 years 15 years 5 years
an account established under the Uniform Transfers to
Minors Act or its predecessor act
Section 8(1) Funds held or owing under a life or endowment insurance 3 years 5 years 5 years
policy or annuity contract that has matured or terminated
Section 13(1) Property and any income or increment derived from it 3 years 5 years 5 years
held in a fiduciary capacity for benefit of another person
Section 15(1) Gift certificates, gift cards, or credit memos 3 years 5 years 5 years
Section 17 Property held in a safe deposit box or another safekeeping 3 years 5 years 5 years
repository and proceeds resulting from the sale of the
property as allowed by law
The bill would apply to property that is presumed abandoned and subject to the state’s custody on or after the bill’s effective date.
MCL 567.225 et seq.
House Fiscal Agency SBs 388 and 389 (S-1) as reported Page 3 of 4
 Senate Bill 388 would amend the Credit Union Act to provide that the dormancy periods
prescribed under the Uniform Unclaimed Property Act determine the length of time a member
can have an account that is designated as inactive under the Credit Union Act before the money
or other property in the account is escheated to the state.
The Credit Union Act provides procedures and requirements for designating an account with a
domestic credit union as inactive. Currently, a member may have an inactive designation on
their account for three years, after which time the credit union must deliver the money or
property in the account to the state as provided in the Uniform Unclaimed Property Act and
terminate any membership based on the account.
The bill would change the current three-year period to “the time frame prescribed in the
Uniform Unclaimed Property Act” (which would include the periods proposed by SB 388, as
described above).
MCL 490.355
FISCAL IMPACT:
Senate Bills 388 and 389 would have an indeterminate fiscal impact on the state and no fiscal
impact on local governments. While under the bills’ provisions some property may be remitted
to the state as unclaimed under revised timelines, this is not expected to have a significant
change to the number of properties that will ultimately be determined as unclaimed.
POSITIONS:
Representatives of the following entities testified in support of the bills (2-6-24):
• Department of Insurance and Financial Services
• Michigan Credit Union League
The Department of Military and Veterans Affairs indicated support for the bills. (2-6-24)
Legislative Analyst: E. Best
Fiscal Analyst: Viola Bay Wild
■ This analysis was prepared by nonpartisan House Fiscal Agency staff for use by House members in their
deliberations and does not constitute an official statement of legislative intent.
House Fiscal Agency SBs 388 and 389 (S-1) as reported Page 4 of 4


Statutes affected:
Senate Introduced Bill: 490.355
As Passed by the Senate: 490.355
As Passed by the House: 490.355
Public Act: 490.355
Senate Enrolled Bill: 490.355