Bill Summary for H 759 (2017-2018)

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Summary date: 

Apr 11 2017

Bill Information:

View NCGA Bill Details2017-2018 Session
House Bill 759 (Public) Filed Tuesday, April 11, 2017
AN ACT TO PROVIDE UNIFORMITY IN THE MANAGEMENT OF PERPETUAL CARE TRUST FUNDS FOR THE BENEFIT OF CEMETERIES.
Intro. by Michaux.

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Bill summary

Amends GS 65-48 (definitions for the North Carolina Cemetery Act), to add and define the terms net income and perpetual care trust fund

Enacts new GS 65-64.1, Management of perpetual care trust fund. Establishes that the statute applies to perpetual care trust fund agreements entered into, renewed, or modified on or after the effective date of this act. Defines perpetual care trust fund as a trust fund that provides for the perpetual care and maintenance of a cemetery, including a care and maintenance trust fund, a perpetual care fund, and a perpetual trust fund. Adds that to the extent the statute conflicts with other provisions in Article 9, new GS 65-64.1 controls. 

Authorizes a cemetery company to enter into a perpetual care trust fund agreement with a trustee that meets the requirements of GS 65-60.1 or the State Treasurer. Directs the State Treasurer to replace a trustee when: (1) if the trustee is licensed by the Commissioner of Banks or the Administrator of Credit Unions, the trustee's license is suspended, revoked, or expired or (2) the Cemetery Commission disapproves the trustee. 

Provides for the management of the fund as follows. Directs the trustee to invest and reinvest the perpetual care trust fund in accordance with GS 32-71. Requires the trustee, at least quarterly, to pay to the cemetery company the net income of the perpetual care trust fund, and furnish to the cemetery company an accounting statement that shows all investments, the investments' costs, the investments' current market value, all income earned on the investments, and the net income paid to the cemetery company during the period covered by the statement. Directs the trustee to add all appreciation, gains, stock dividends, and other benefits, other than cash income, to the corpus of the perpetual care trust fund. Requires the trustee to charge any loss on investment against the corpus. Provides that, if the net income is insufficient to pay all trust administration expenses, the cemetery company is not obligated to pay the unpaid amount. Establishes that no person can withdraw, transfer, or place a security interest in any portion of the corpus.

Requires a trustee of a perpetual care trust fund to file bond with the Cemetery Commission to secure the performance of the trustee's duties under Article 9. Provides parameters for the execution and amount of the trustee's bond. Establishes that a bank or trust company licensed to do trust business in North Carolina is exempt from these requirements. Adds that the State Treasurer is also exempt from these requirements.

Prohibits the parties to a perpetual care trust fund agreement from varying the requirements of the statute without first obtaining written consent from either the Cemetery Commission or, if the State Treasurer is the trustee, the State Treasurer.

Applies to perpetual care trust fund agreements entered into, renewed, or modified on or after the date the act becomes law.