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Commonwealth of Pennsylvania Legislative COMMONWEALTH OF PENNSYLVANIA LEGISLATIVE JOURNAL MONDAY, NOVEMBER 12, 1990 SESSION OF 1990 174TH OF THE GENERAL ASSEMBLY No. 55 SENATE COMMUNICATIONS FROM THE GOVERNOR MONDAY, November 12, 1990. APPROVAL OF SENATE BILLS The Senate met at 2:00 p.m., Eastern Standard Time. The PRESIDENT laid before the Senate communications The PRESIDENT (Lieutenant Governor Mark S. Singe!) in writing from His Excellency, the Governor of the Com­ in the Chair. monwealth, advising that the following Senate Bills had been approved and signed by the Governor: PRAYER SB 693, 1291, 1442, 1535 and 1588. The Chaplain, Monsignor LEO P. BEIERSCHMITT, SENATE BILLS RETURNED WITHOUT APPROVAL Pastor of Saint Catherine Laboure Church, Harrisburg, offered the following prayer: The PRESIDENT laid before the Senate the following veto messages from His Excellency, the Governor of the Common­ Let us pray. wealth, advising that the following Senate Bills have been Almighty and everlasting God, we pray for all our brothers returned without approval: and sisters throughout this great Commonwealth. We pray that we may recognize the injustices among men and, at times, SB 775, entitled: we find even in ourselves, and our failure to appreciate our An Act amending Titles 20 (Decedents, Estates and Fiducia­ brotherhood. ries) and 72 (Taxation and Fiscal Affairs) of the Pennsylvania Grant peace and security ito the poor and the persecuted, Consolidated Statutes, reducing the time for advertisement of accounts to two weeks; adding a section providing that docu­ the underprivileged, the exceptional, the unborn, those suffer­ ments submitted to the register of wills, except for probate, may ing from the ravages of war and the natural disasters of earth. be attested to by an affidavit or by a verified statement; broaden­ Grant us the wisdom to deal honestly and uprightly with the ing the class of property deemed disclaimed when a spouse takes minorities in our Commonwealth. an elective share; avoiding automatic modification of wills and Help us overcome the prejudices we harbor within our­ inter vivos conveyances that are made in contemplation of a mar­ riage or divorce; adding a rule of interpretation for wills and con­ selves. Let us not be guilty of stigmatizing anyone for any veyances regarding corporate fiduciaries; confirming existing law reason. Help us to realize the equality of all men and women that a gift to any unfunded trust is valid; adding a chapter relat­ in their rights of life, freedom and happiness in this world and ing to contracts concerning succession; authorizing personal rep­ in the next. May all of us do our part, cooperating with You, resentatives to make certain temporary investments; allowing to serve You in our brothers and sisters. Amen. fiduciaries to hold certain securities in book-entry form; further providing for notice to parties in interest; further providing for The PRESIDENT. The Chair thanks Monsignor rights of claimants; authorizing the guardian of the estate of a Beierschmitt who is the guest this day of Senator Hess and minor to distribute certain income without court approval; Senator Shumaker. adding the Pennsylvania Uniform Transfers to Minors Act; adding provisions relating to guardians of incapacitated persons; clarifying the jurisdiction of the court to appoint certain tempo­ JOURNAL APPROVED rary guardians; authorizing the court to exercise all rights and privileges under certain contracts which provide for payments to The PRESIDENT. A quorum of the Senate being present, an incompetent or others after the incompetent's death; authoriz­ the Clerk will read the Journal of the preceding Session of ing the court to modify the estate plan of an incompetent to October 3, 1990. reflect changes in applicable tax laws; permitting certain powers of attorney to be executed by mark; ensuring the validity of The Clerk proceeded to read the Journal of the preceding durable powers of attorney; authorizing the court to allow a Session, when, on motion of Senator LOEPER, further shorter period of notice to an absentee; providing that as a matter reading was dispensed with, and the Journal was approved. of law divorce revokes any revocable beneficiary designation made in favor of the former spouse; further providing for the annexation of accounts; further authorizing the court to divide trusts; further authorizing the court to grant declaratory relief with respect to certain interests in real property; exempting spousal transfers from inheritance taxation; providing for the taxation of certain spousal trusts; adding conforming amend­ ments to Titles 13, 18, 23 and 42; amending Title 72 to exempt 2560 LEGISLATIVE JOURNAL-SENATE NOVEMBER 12. spousal transfers from inheritance taxation; and making techni­ couples own their homes and other assets jointly and, therefore, cal changes. will pay no inheritance tax when one spouse dies. In fact, each year, fewer than 5,000 Pennsylvanians die The Clerk read the veto message as follows: leaving property that is taxable to their spouse. Less than half October 12, 1990 that number leave small estates valued below $50,000. All of those small estates added together pay less than five percent of To the Honorable, the Senate the tax to be eliminated by the bill. The people who pay the bulk of the Commonwealth of Pennsylvania: of this tax, and the ones who will benefit most by its repeal, are I return herewith, without my approval, Senate Bill 775, some of the wealthiest people in Pennsylvania. Printer's Number 2485, entitled "An Act amending Titles 20 When fully operational, the bill would provide a $30 million (Decedents, Estates and Fiduciaries) and 72 (Taxation and Fiscal tax break for about 1,000 of our wealthiest residents. That Affairs) of the Pennsylvania Consolidated Statutes, reducing the money has to come from somewhere. It would come from the time for advertisement of accounts to two weeks; adding a section pockets of working men and women across Pennsylvania in the providing that documents submitted to the register of wills, form of higher taxes or reductions in essential programs. Penn­ except for probate, may be attested to by an affidavit or by a veri­ sylvania can ill-afford to be cutting taxes for the rich in the face fied statement; broadening the class of property deemed dis­ of growing demands for funding essential programs like special claimed when a spouse takes an elective share; avoiding auto­ education, higher education, senior citizens' programs, environ­ matic modification of wills and inter vivos conveyances that are mental cleanup, health care and other critical human needs. made in contemplation of a marriage or divorce; adding a rule of If this legislation were in reality a benefit designed for poor interpretation for wills and conveyances regarding corporate widow, I would sign it. But, it is not. It amounts to a huge fiduciaries; confirming existing law that a gift to any unfunded giveaway to the rich, masquerading as a benefit to the poor. trust is valid; adding a chapter relating to contracts concerning I remain deeply concerned about people who are not wealthy, succession; authorizing personal representatives to make certain who lose their spouse, and find themselves faced with tax bills as temporary investments; allowing fiduciaries to hold certain secu­ . a result. rities in book-entry form; further providing for notice to parties Therefore, I am asking the legislative leaders to work with all in interest; further providing for rights of claimants; authorizing interested groups to craft a law that will provide relief to those the guardian of the estate of a minor to distribute certain income people for whom this tax constitutes an unconscionable economic without court approval; adding the Pennsylvania Uniform Trans­ burden at the traumatic time of loss of a spouse. That legisla­ fers to Minors Act; adding provisions relating to guardians of tion must not, however, be a windfall for the rich. incapacitated persons; clarifying the jurisdiction of the court to This bill contains a number of other changes designed to avoid appoint certain temporary guardians; authorizing the court to or defer the payment of inheritance taxes. In particular, the bill exercise all rights and privileges under certain contracts which would no longer apply the tax to a surviving spouse who inherits a provide for payments to an incompetent or others after the life estate. Such property would only be taxable to those who incompetent's death; authorizing the court to modify the estate subsequently inherit it, after termination of the life estate, and plan of an incompetent to reflect changes in applicable tax laws; the tax would be based upon the value of the property at that permitting certain powers of attorney to be executed by mark; time. This provision could have a significant impact upon Com­ ensuring the validity of durable powers of attorney; authorizing monwealth inheritance tax revenues, particularly in the first year the court to allow a shorter period of notice to an absentee; pro­ of implementation. While it is difficul,t to estimate the potential viding that as a matter of law divorce revokes any revocable bene­ losses with precision, they would certainly exacerbate the revenue ficiary designation made in favor of the former spouse; further drain caused by the proposed repeal of the tax on spousal trans­ providing for the annexation of accounts further authorizing the fers. court to divide trusts; further authorizing the court to grant In addition to these tax law changes, Senate Bill 775 would declaratory relief with respect to certain interests in real property; establish new rights for persons alleged to be incapacitated and in exempting spousal transfers from inheritance taxation; providing need of guardianship services. for the taxation of certain spousal trusts; adding conforming Without question, reform of Pennsylvania's antiquated amendments to Titles 13, 18, 23 and 42; amending Title 72 to guardianship law is long overdue.
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