HOUSE BILL NO. 3246 103RD GENERAL ASSEMBLY
INTRODUCED BY REPRESENTATIVE PARKER.
6565H.02I JOSEPH ENGLER, Chief Clerk
AN ACT To repeal sections 214.330, 469.401, 469.402, 469.403, 469.405, 469.409, 469.411, 469.413, 469.415, 469.417, 469.419, 469.421, 469.423, 469.425, 469.427, 469.429, 469.431, 469.432, 469.433, 469.435, 469.437, 469.439, 469.441, 469.443, 469.445, 469.447, 469.449, 469.451, 469.453, 469.455, 469.457, 469.459, 469.461, 469.463, 469.465, and 469.467, RSMo, and to enact in lieu thereof forty-eight new sections relating to trust and estate administration.
Be it enacted by the General Assembly of the state of Missouri, as follows:
Section A. Sections 214.330, 469.401, 469.402, 469.403, 469.405, 469.409, 469.411, 2 469.413, 469.415, 469.417, 469.419, 469.421, 469.423, 469.425, 469.427, 469.429, 469.431, 3 469.432, 469.433, 469.435, 469.437, 469.439, 469.441, 469.443, 469.445, 469.447, 469.449, 4 469.451, 469.453, 469.455, 469.457, 469.459, 469.461, 469.463, 469.465, and 469.467, 5 RSMo, are repealed and forty-eight new sections enacted in lieu thereof, to be known as 6 sections 214.330, 469.399, 469.401, 469.402, 469.403, 469.404, 469.405, 469.413, 469.415, 7 469.417, 469.419, 469.421, 469.423, 469.425, 469.427, 469.429, 469.431, 469.432, 469.433, 8 469.435, 469.437, 469.439, 469.441, 469.443, 469.445, 469.447, 469.449, 469.450, 469.451, 9 469.453, 469.455, 469.456, 469.457, 469.459, 469.462, 469.463, 469.464, 469.465, 469.467, 10 469.471, 469.473, 469.475, 469.477, 469.479, 469.481, 469.483, 469.485, and 469.487, to 11 read as follows: 214.330. 1. (1) The endowed care trust fund required by sections 214.270 to 214.410 2 shall be permanently set aside in trust or in accordance with the provisions of subsection 2 of 3 this section. The trustee of the endowed care trust shall be a state or federally chartered 4 financial institution authorized to exercise trust powers in Missouri. The contact information
EXPLANATION — Matter enclosed in bold-faced brackets [thus] in the above bill is not enacted and is intended to be omitted from the law. Matter in bold-face type in the above bill is proposed language. HB 3246 2
5 for a trust officer or duly appointed representative of the trustee with knowledge and access to 6 the trust fund accounting and trust fund records must be disclosed to the office or its duly 7 authorized representative upon request. 8 (2) The trust fund records, including all trust fund accounting records, shall be 9 maintained in the state of Missouri at all times or shall be electronically stored so that the 10 records may be made available in the state of Missouri within fifteen business days of receipt 11 of a written request. The operator of an endowed care cemetery shall maintain a current name 12 and address of the trustee and the records custodian for the endowed care trust fund and shall 13 supply such information to the office, or its representative, upon request. 14 (3) Missouri law shall control all endowed care trust funds and the Missouri courts 15 shall have jurisdiction over endowed care trusts regardless of where records may be kept or 16 various administrative tasks may be performed. 17 2. An endowed care trust fund shall be administered in accordance with Missouri law 18 governing trusts, including but not limited to the applicable provisions of chapters 456 and 19 469, except as specifically provided in this subsection or where the provisions of sections 20 214.270 to 214.410 provide differently, provided that a cemetery operator shall not in any 21 circumstances be authorized to restrict, enlarge, change, or modify the requirements of this 22 section or the provisions of chapters 456 and 469 by agreement or otherwise. 23 (1) Income and principal of an endowed care trust fund shall be determined under the 24 provisions of law applicable to trusts, except that the [provisions of section 469.405 shall not 25 apply] trustee shall have: 26 (a) No power of adjustment under section 469.405; 27 (b) No power of conversion either from an income trust to a unitrust or from a 28 unitrust to an income trust under section 469.475; 29 (c) No power or discretion to determine or modify the unitrust rate, as 30 established in the terms of the endowed care trust agreement; and 31 (d) No discretion to determine applicable value for purposes of computing the 32 unitrust amount beyond that granted by law and exercised solely for reasons of 33 administrative convenience and not to affect the size of distributions. 34 35 In determining applicable value under section 469.473, values over a three-year period 36 if available, or the duration of the trust if shorter, shall be used. 37 (2) No principal shall be distributed from an endowed care trust fund except to the 38 extent that a unitrust [election is in effect with respect to such trust under the provisions of 39 section 469.411] amount is required by the terms of the endowed care trust fund 40 agreement under subdivision (6) of this subsection. HB 3246 3
41 (3) No right to transfer jurisdiction from Missouri under section 456.1-108 shall exist 42 for endowed care trusts. 43 (4) All endowed care trusts shall be irrevocable. 44 (5) No trustee shall have the power to terminate an endowed care trust fund under the 45 provisions of section 456.4-414. 46 (6) A unitrust [election made in accordance with the provisions of chapter 469 shall 47 be made by the cemetery operator in the terms of the endowed care trust fund agreement 48 itself, not by the trustee] definition of income under sections 469.471 to 469.487 shall be 49 established by the cemetery operator in the terms of the endowed care trust fund 50 agreement itself, not by the trustee, and shall not provide for a unitrust rate exceeding 51 five percent per annum. The unitrust rate shall be changed only by amendment to the 52 agreement as provided in this section. 53 (7) No contract of insurance shall be deemed a suitable investment for an endowed 54 care trust fund. 55 (8) The income from the endowed care fund may be distributed to the cemetery 56 operator at least annually on a date designated by the cemetery operator by record, but no 57 later than sixty days following the end of the [trust fund] trust's fiscal year. Any income not 58 distributed within sixty days following the end of the trust's fiscal year shall be added to and 59 held as part of the principal of the trust fund. The cemetery operator may instruct by 60 record the trustee to distribute less than all the income distributable for the year if the 61 cemetery operator determines that the money is not needed. 62 3. The cemetery operator shall have the duty and responsibility to apply the income 63 distributed to provide care and maintenance only for that part of the cemetery designated as 64 an endowed care section and not for any other purpose. 65 4. In addition to any other duty, obligation, or requirement imposed by sections 66 214.270 to 214.410 or the endowed care trust agreement, the trustee's duties shall be the 67 maintenance of records related to the trust and the accounting for and investment of moneys 68 deposited by the operator to the endowed care trust fund. 69 (1) For the purposes of sections 214.270 to 214.410, the trustee shall not be deemed 70 responsible for the care, the maintenance, or the operation of the cemetery, or for any other 71 matter relating to the cemetery, or the proper expenditure of funds distributed by the trustee to 72 the cemetery operator, including, but not limited to, compliance with environmental laws and 73 regulations. 74 (2) With respect to cemetery property maintained by endowed care funds, the 75 cemetery operator shall be responsible for the performance of the care and maintenance of the 76 cemetery property. HB 3246 4
77 5. If the endowed care cemetery fund is not permanently set aside in a trust fund as 78 required by subsection 1 of this section, then the funds shall be permanently set aside in an 79 escrow account in the state of Missouri. Funds in an escrow account shall be placed in an 80 endowed care trust fund under subsection 1 if the funds in the escrow account exceed three 81 hundred fifty thousand dollars, unless otherwise approved by the division for good cause. 82 The account shall be insured by the Federal Deposit Insurance Corporation or comparable 83 deposit insurance and held in a state or federally chartered financial institution authorized to 84 do business in Missouri and located in this state. 85 (1) The interest from the escrow account may be distributed to the cemetery operator 86 at least in annual or semiannual installments, but not later than six months following the 87 calendar year. Any interest not distributed within six months following the end of the 88 calendar year shall be added to and held as part of the principal of the account. 89 (2) The cemetery operator shall have the duty and responsibility to apply the interest 90 to provide care and maintenance only for that part of the cemetery in which burial space shall 91 have been sold and with respect to which sales the escrow account shall have been established 92 and not for any other purpose. The principal of such funds shall be kept intact. The cemetery 93 operator's duties shall be the maintenance of records and the accounting for an investment of 94 moneys deposited by the operator to the escrow account. For purposes of sections 214.270 to 95 214.410, the administrator of the office of endowed care cemeteries shall not be deemed to be 96 responsible for the care, maintenance, or operation of the cemetery. With respect to cemetery 97 property maintained by cemetery care funds, the cemetery operator shall be responsible for 98 the performance of the care and maintenance of the cemetery property owned by the cemetery 99 operator. 100 (3) The division may approve an escrow agent if the escrow agent demonstrates the 101 knowledge, skill, and ability to handle escrow funds and financial transactions and is of good 102 moral character. 103 6. The cemetery operator shall be accountable to the owners of burial space in the 104 cemetery for compliance with sections 214.270 to 214.410. 105 7. Excluding funds held in an escrow account, all endowed care trust funds shall be 106 administered in accordance with an endowed care trust fund agreement, which shall be 107 submitted to the office by the cemetery operator for review and approval. The endowed care 108 cemetery shall be notified in writing by the office of endowed care cemeteries regarding the 109 approval or disapproval of the endowed care trust fund agreement and regarding any changes 110 required to be made for compliance with sections 214.270 to 214.410 and the rules and 111 regulations promulgated thereunder. 112 8. All endowed care cemeteries shall be under a continuing duty to file with the office 113 of endowed care cemeteries and to submit for prior approval any and all changes, HB 3246 5
114 amendments, or revisions of the endowed care trust fund agreement at least thirty days before 115 the effective date of such change, amendment, or revision. 116 9. If the endowed care trust fund agreement, or any changes, amendments, or 117 revisions filed with the office, are not disapproved by the office within thirty days after 118 submission by the cemetery operator, the endowed care trust fund agreement, or the related 119 change, amendment, or revision, shall be deemed approved and may be used by the cemetery 120 operator and the trustee. Notwithstanding any other provision of this section, the office may 121 review and disapprove an endowed care trust fund agreement, or any submitted change, 122 amendment, or revision, after the thirty days provided herein or at any other time if the 123 agreement is not in compliance with sections 214.270 to 214.410 or the rules promulgated 124 thereunder. Notice of disapproval by the office shall be in writing and delivered to the 125 cemetery operator and the trustee within ten days of disapproval. 126 10. Funds in an endowed care trust fund or escrow account may be commingled with 127 endowed care funds for other endowed care cemeteries, provided that the cemetery operator 128 and the trustee shall maintain adequate accounting records of the disbursements, 129 contributions, and income allocated for each cemetery. 130 11. By accepting the trusteeship of an endowed care trust or accepting funds as an 131 escrow agent pursuant to sections 214.270 to 214.410, the trustee or escrow agent submits 132 personally to the jurisdiction of the courts of this state and the office of endowed care 133 cemeteries regarding the administration of the trust or escrow account. A trustee or escrow 134 agent shall consent in writing to the jurisdiction of the state of Missouri and the office in 135 regards to the trusteeship or the operation of the escrow account and to the appointment of the 136 office of secretary of state as its agent for service of process regarding any administrative or 137 legal actions relating to the trust or the escrow account, if it has no designated agent for 138 service of process located in this state. Such consent shall be filed with the office prior to 139 accepting funds pursuant to sections 214.270 to 214.410 as trustee or as an escrow agent on a 140 form provided by the office by rule. 469.399. Sections 469.399 to 469.487 shall be known and may be cited as the 2 "Missouri Uniform Fiduciary Income and Principal Act". 469.401. As used in sections [469.401] 469.399 to [469.467] 469.487, the following 2 terms mean: 3 (1) "Accounting period", a calendar year unless [another twelve-month period is 4 selected by] a fiduciary selects another period of twelve calendar months or 5 approximately twelve calendar months. The term includes a [portion] part of a 6 calendar year or [other twelve-month] another period [that] of twelve calendar months or 7 approximately twelve calendar months that begins when an income interest begins or ends 8 when an income interest ends; HB 3246 6
9 (2) "Asset-backed security", a security that is serviced primarily by the cash 10 flows of a discrete pool of fixed or revolving receivables or other financial assets that by 11 their terms convert into cash within a finite time. The term includes rights or other 12 assets that ensure the servicing or timely distribution of proceeds to the holder of the 13 asset-backed security. The term does not include an asset to which section 469.423, 14 469.437, or 469.447 applies; 15 (3) "Beneficiary", includes: 16 (a) For a trust: 17 a. A current beneficiary, including a current income beneficiary and a 18 beneficiary that may receive only principal; 19 b. A remainder beneficiary; and 20 c. Any other successor beneficiary; 21 (b) For an estate, an heir, legatee, and devisee [of a decedent's estate, and an income 22 beneficiary and a remainder beneficiary of a trust, including any type of entity that has a 23 beneficial interest in either an estate or a trust]; and 24 (c) For a life estate or term interest, a person that holds a life estate, term 25 interest, or remainder or other interest following a life estate or term interest; 26 (4) "Court", any court in this state having jurisdiction relating to a trust, estate, 27 life estate, or other term interest described in subdivision (2) of subsection 1 of section 28 469.402; 29 (5) "Current income beneficiary", a beneficiary to which a fiduciary may 30 distribute net income, whether or not the fiduciary also may distribute principal to the 31 beneficiary; 32 (6) "Distribution", a payment or transfer by a fiduciary to a beneficiary in the 33 beneficiary’s capacity as a beneficiary, made under the terms of the trust, without 34 consideration other than the beneficiary’s right to receive the payment or transfer 35 under the terms of the trust. "Distribute", "distributed", and "distributee" have 36 corresponding meanings; 37 (7) "Estate", a decedent’s estate. The term includes the property of the decedent 38 as the estate is originally constituted and the property of the estate as it exists at any 39 time during administration; 40 [(3)] (8) "Fiduciary", includes a trustee, trust protector determined under section 41 456.8-808, personal representative, [trustee, executor, administrator, successor personal 42 representative, special administrator and any other person performing substantially the same 43 function] life tenant, holder of a term interest, and person acting under a delegation 44 from a fiduciary. The term includes a person that holds property for a successor 45 beneficiary whose interest may be affected by an allocation of receipts and expenditures HB 3246 7
46 between income and principal. If there are two or more co-fiduciaries, the term 47 includes all co-fiduciaries acting under the terms of the trust and applicable law; 48 [(4)] (9) "Income", money or other property [that] a fiduciary receives as current 49 return from [a] principal [asset, including a portion]. The term includes a part of receipts 50 from a sale, exchange, or liquidation of a principal asset, [as] to the extent provided in 51 sections 469.423 to [469.449] 469.450; 52 [(5) "Income beneficiary", a person to whom net income of a trust is or may be 53 payable; 54 (6)] (10) "Income interest", the right of [an] a current income beneficiary to receive 55 all or part of net income, whether the terms of the trust require [it] the net income to be 56 distributed or authorize [it] the net income to be distributed in the [trustee's] fiduciary's 57 discretion. The term includes the right of a current beneficiary to use property held by a 58 fiduciary; 59 (11) "Independent person", a person that is not: 60 (a) For a trust: 61 a. A qualified beneficiary as defined under section 456.1-103; 62 b. A settlor of the trust; or 63 c. An individual whose legal obligation to support a beneficiary may be satisfied 64 by a distribution from the trust; 65 (b) For an estate, a beneficiary; 66 (c) A spouse, parent, brother, sister, or issue of an individual described in 67 paragraph (a) or (b) of this subdivision; 68 (d) A corporation, partnership, limited liability company, or other entity in 69 which persons described in paragraphs (a) to (c) of this subdivision, in the aggregate, 70 have voting control; or 71