Jerry Brown: California avoided budget deficit through cuts, new taxes
A childhood savings account, grandparent’s safe-deposit box or long-ago stock purchase: they may be forgotten, but they’re not gone.
Under California law, financial institutions and other businesses must annually report and hand over properties that have been dormant, with no owner contact, in most cases for three years. They become part of California’s unclaimed property program managed by the State Controller’s Office.
The Controller’s Office received $735.2 million in lost or abandoned property during 2015-16. But it reunited just $307.6 million in property with the rightful owners.
California has a growing balance of unclaimed property as a result. By mid-2018, the total will be an estimated $9 billion, according to Controller’s Office estimates. That’s up from $5.3 billion in 2006-07.
About 95 percent of the unclaimed property is cash, and the money doesn’t sit in an account gathering dust. Unclaimed property represents the state’s fifth-largest source of general fund revenue. Gov. Jerry Brown’s January proposal counts on $378 million in unclaimed property revenue in the budget year that begins July 1.
The prospect of rightful owners someday claiming billions of dollars en masse “will never occur for a variety of reasons,” the nonpartisan Legislative Analyst’s Office wrote in a 2015 report. Some people have died or moved to other states, and other property includes little or no information about the owners, the analyst’s office reported.
The state budget limits to just $61,000 what the state can spend to advertise the unclaimed property program. Controller Betty Yee regularly talks up the unclaimed property database, including at a Sacramento Kings game earlier this year, where she told the crowd that team executive Vlade Divac was among those with unclaimed items. (Divac later filed a claim.)
“Every day we reunite more properties and we get in more properties,” Yee said, adding that the value of properties reunited with their owners increased by 24 percent in 2015-16, her first year in office. “We have a tremendous responsibility to hold this property in perpetuity.”
Brown’s January budget targets $3 million to hire workers to handle a particularly challenging category of unclaimed property: securities. The Controller’s Office has to track splits, mergers, dividends and other corporate actions affecting a portfolio of more than 728 million shares of stocks, bonds and other securities that remain uncollected.
That spending will generate money for the state budget – the Controller’s Office estimated it will produce an average of $86 million a year.
Data Tracker is a regular feature that breaks down the numbers behind today’s news. Explore more trends at sacbee.com/datatracker.
To find property
Go to this link to search for unclaimed property in California: https://ucpi.sco.ca.gov/UCP/Default.aspx