Treasurer: Unclaimed Property Program Falls Short of Money to Pay Claims
BATON ROUGE – State Treasurer John M. Schroder announced that the state’s unclaimed property program is temporarily short of the money needed to pay claims because of state budget “sweeps,” when money is taken from various funds into the state’s general fund to prop up the state budget. A similar shortfall arose two years ago.
Schroder said the program had a balance of $623,715.10 on Sept. 22, leaving it short of the money needed to pay all pending claims. Since 1973, more than $600 million in unclaimed property has been used to balance the state budget, leading to shortfalls in the ability to pay claims. The treasurer is opposed to the practice.
Schroder said claimants may need to wait several weeks to retrieve their property. Businesses traditionally remit lost money to the state in late October, which will generate enough funding to resume paying claims.
“Unclaimed property isn’t the state’s money. It belongs to the people and businesses of Louisiana. We shouldn’t have to delay returning people’s money to them,” he said. “I’m thankful the citizens of Louisiana will be able to vote Nov. 3 on whether to place unclaimed property into a trust fund. A trust fund will prevent future shortfalls.”
Schroder is a proponent of a constitutional amendment that will create the Unclaimed Property Permanent Trust Fund beginning July 1, 2021. Schroder said the fund’s investment earnings will create a state revenue source.
For decades, Louisiana has collected unclaimed money from residents’ forgotten savings accounts, payroll checks, stocks and dividends, insurance proceeds and utility deposits. The treasurer’s office tries to return the money to its rightful owners. Louisiana governors and lawmakers, meanwhile, have long used some of the money to pay for state operating expenses but Schroder wants to change that system. After a legal and political skirmish earlier this year, Gov. John Bel Edwards and Schroder agreed on a plan that will lead to the vote on a potential trust fund.