Chapter 402 Trust Funds for Disabled Persons

402.142 - Federal acts, effect of.

Steven Groce, Attorney Advertisement

As authorized in 15 U.S.C. 7002, as amended, sections 402.130 to 402.148 modify, limit, or supersede* the federal Electronic Signatures in Global and National Commerce Act, 15 U.S.C. Section 7001, et seq., but do not modify, limit, or supersede 15 U.S.C. Section 7001(a), or authorize electronic delivery of any of the notices described in 15 U.S.C. Section 7003(b).

(L. 2009 H.B. 239)

*Words "modifies, limits, or supersedes" appear in original rolls.

402.146 - Uniformity of law to be considered in application of law.

In applying and construing sections 402.130 to 402.148, consideration shall be given to the need to promote uniformity of the law with respect to its subject matter among states that enact it.

(L. 2009 H.B. 239)

402.203 - Contribution of assets, by whom — trust account to be created — cotrustees and successors — breach of fiduciary duty, effect of — death of beneficiary, procedure — remainder distribution.

1.A beneficiary who is a person with disabilities as defined in Section 1614(a)(3) of the Social Security Act, 42 U.S.C.1382c(a)(3), or the parent, grandparent, or legal guardian of a beneficiary, or a court, as settlor, may contribute assets of the beneficiary in trust to the board as trustee, for the benefit of the beneficiary as part of a pooled trust described by 42 U.S.C. Section 1396p(d)(4)(C).Upon such contribution, the settlor's completion and execution of trust documents provided by the trustee, and the trustee's review, approval and execution of the trust documents, a trust account for the beneficiary shall thereby be created.A trust account to which the assets of a beneficiary are contributed shall be referred to as a "first party trust account" and shall be held and administered in trust for the benefit of the beneficiary as provided in this section.

2.The settlor may designate a cotrustee, and a successor or successors to the cotrustee, to act together with the trustee as trustees of the first party trust account; provided that the beneficiary may not act as a cotrustee or successor cotrustee; and provided further that court approval of the beneficiary, cotrustee or successor trustee shall be required in connection with any first party trust account created pursuant to section 473.657 or section 475.093.

3.If the board determines, in its good faith judgment, that a cotrustee has breached his or her fiduciary duties, either as a result of an act of commission or omission, then the board may seek removal of such cotrustee and the appointment of a successor cotrustee upon application to a court of competent jurisdiction.

4.At the death of the beneficiary, the board of trustees shall provide notice that the trust account has terminated to each state of which the board of trustees has knowledge that such state has provided medical assistance on behalf of the beneficiary under a state plan for medical assistance under Title 42 of the United States Code.After distribution of twenty-five percent of the principal balance of the trust account to the charitable trust, the board of trustees shall pay over and distribute to such states all amounts remaining in the trust account up to an amount equal to the total medical assistance paid by such states on behalf of the beneficiary under the state plan for medical assistance under Title 42 of the United States Code.In the event that the beneficiary has received medical assistance from more than one state with claims on the proceeds for reimbursement of medical assistance payments under Title 42 of the United States Code and there are insufficient assets to pay the entire balance due to each state then the proceeds shall be distributed to each state on a pro rata basis based upon each state's proportionate share of the total medical assistance paid by all states.

5.To the extent any amounts remain in the trust account after distribution to the charitable trust and the state or states for state reimbursement claims, the remainder shall be distributed to such person, entities, or organizations designated as remainder beneficiaries by the settlor in the trust documents.If any individual remainder beneficiary named by the settlor is not then living, then in the absence of contrary instruction in the trust documents completed by the settlor, such remainder beneficiary's distribution shall be made to such remainder beneficiary's heirs at law, as determined by the laws of the state of the beneficiary's residence at the time of the beneficiary's death.

(L. 2011 S.B. 70)

402.207 - Charitable trust established, when.

1.The board of trustees shall establish a charitable trust for the benefit of individuals with disabilities.

2.The board of trustees shall accept contributions to the charitable trust at the termination of trust accounts and other contributions from donors in accordance with policies and procedures adopted by the board of trustees.

3.The trustees shall as necessary determine the amount of income and principal of the charitable trust to be used to provide benefits for individuals with disabilities.Benefits provided shall only be those that have no negative effect on the individual's entitlement to government benefits.Any income not used to provide benefits shall be added to the principal annually.

4.Any person with the consent of the board of trustees may establish a restricted account within the charitable trust and may determine, with the consent of the board of trustees, the class of individuals eligible to be recipients of funds from the restricted account, so long as the eligible recipients are individuals with disabilities as set forth in section 402.200.

(L. 2011 S.B. 70)

402.199 - Declaration of policy — contributions to Missouri family trust not to adversely impact other benefits of beneficiaries.

1.The general assembly hereby finds and declares the following:

(1)It is an essential function of state government to provide basic support and services for certain persons with disabilities;

(2)Many persons with disabilities lack financial resources and must rely upon the government to provide services and support; and

(3)It is in the best interest of the state and is necessary and desirable for the public health, safety, and welfare to encourage, enhance and foster the ability of individuals with disabilities who reside in Missouri or who reside in one of the eight states adjacent to Missouri, and in the best interests of their families and friends to supplement, but not replace, the services and support provided by state government and other governmental programs.

2.In light of the findings and declarations described in subsection 1 of this section, the general assembly hereby declares that contributions to a trust account administered as part of the Missouri family trust by the Missouri family trust board of trustees as authorized in sections 402.199 to 402.208, shall in no way reduce, impair, or diminish the benefits to which the beneficiary of the trust account is otherwise entitled by law, nor shall the administration of the Missouri family trust or any trust account therein be taken into consideration in determining appropriations for programs or services for persons with disabilities, and unless otherwise prohibited by federal statutes or regulations, all state agencies shall disregard the trust account as a resource when determining the eligibility of a resident for assistance under chapter 208.

(L. 1991 S.B. 311, A.L. 1993 H.B. 136 merged with S.B. 338, A.L. 1999 S.B. 211, A.L. 2004 H.B. 923, A.L. 2011 S.B. 70)

402.136 - Delegation of management and investment, when — requirements of the institution.

1.Subject to any specific limitation set forth in a gift instrument or law not within sections 402.130 to 402.148, an institution may delegate to an external agent the management and investment of an institutional fund to the extent that an institution could prudently delegate under the circumstances.An institution shall act in good faith with the care that an ordinarily prudent person in a like position would exercise under similar circumstances in:

(1)Selecting an agent;

(2)Establishing the scope and terms of the delegation consistent with the purposes of the institution and the institutional fund; and

(3)Periodically reviewing the agent's actions in order to monitor the agent's performance and compliance with the scope and terms of the delegation.

2.In performing a delegated function, an agent owes a duty to the institution to exercise reasonable care to comply with the scope and terms of the delegation.

3.An institution that complies with subsection 1 of this section is not liable for the decisions or actions of an agent to which the function was delegated.

4.By accepting delegation of a management or investment function from an institution that is subject to the laws of this state, an agent submits to the jurisdiction of the courts of this state in all proceedings arising from or related to the delegation or the performance of the delegated function.

5.An institution may delegate management and investment functions to its committees, officers, or employees as authorized by law other than provided for in sections 402.130 to 402.148.

(L. 2009 H.B. 239)

402.132 - Charitable purposes of the institution and fund to be considered — good faith required — authority of the institution.

1.Subject to the intent of a donor expressed in a gift, an institution, in managing and investing an institutional fund, shall consider the charitable purposes of the institution and the purposes of the institutional fund.

2.In addition to complying with the duty of loyalty imposed by law other than in sections 402.130 to 402.148, each person responsible for managing and investing an institutional fund shall manage and invest the fund in good faith and with the care an ordinary prudent person in a like position would exercise under similar circumstances.

3.In managing and investing an institutional fund, an institution:

(1)May incur only costs that are appropriate and reasonable in relation to the assets, the purpose of the institution, and the skills available to the institution; and

(2)Shall make a reasonable effort to verify facts relevant to the management and investment of the fund.

4.An institution may pool two or more institutional funds for the purposes of management and investment.

5.Except as otherwise provided by a gift instrument, the following rules apply:

(1)In managing and investing an institutional fund, the following factors, if relevant, shall be considered:

(a)General economic conditions;

(b)The possible effect of inflation or deflation;

(c)The expected tax consequences, if any, of investment decisions or strategies;

(d)The role that each investment or course of action plays within the overall investment portfolio of the fund;

(e)The expected total return from the income and the appreciation of investments;

(f)Other resources of the institution;

(g)The needs of the institution and the fund to make the distributions and to preserve capital; and

(h)An asset's special relationship or special value, if any, to the charitable purposes of the institution;

(2)Management and investment decisions about an individual asset shall not be made in isolation but in the context of the institutional fund's portfolio of investments as a whole and as a part of an overall investment strategy having risk and return objectives reasonably suited to the fund and to the institution;

(3)Except as otherwise provided by law other than in sections 402.130 to 402.148, an institution may invest in any kind of property or type of investment consistent with this section;

(4)An institution shall diversify the investments of an institutional fund unless the institution reasonably determines that because of special circumstances the purposes of the fund are better served without diversification;

(5)Within a reasonable time after receiving property, an institution shall make and carry out decisions concerning the retention or disposition of the property or to rebalance a portfolio in order to bring the institutional fund into compliance with the purposes, terms, and distribution requirements of the institution as necessary to meet other circumstances of the institution and the requirements of sections 402.130 to 402.148;

(6)A person that has or represents to have special skills or expertise and in reliance thereupon is selected and assigned institutional funds management and investment functions has a duty to use those skills or that expertise in managing and investing institutional funds.

(L. 2009 H.B. 239)

402.206 - First and third party trusts, account held and administered, how.

Each first party trust account and third party trust account shall be held and administered in trust as follows:

(1)The board of trustees shall hold, administer, and distribute the principal and income of the trust account, in the discretion of the trustee, in consultation with the co-trustee, for the health, education, and general well-being of the beneficiary, recognizing that the purpose of the trust account is to supplement, not replace, any government benefits for the beneficiary's basic support to which such beneficiary may be entitled;

(2)Expenditure of trust account funds shall be made solely for benefit of the beneficiary, to increase the quality of the beneficiary's life by providing those amenities that cannot otherwise be provided by public assistance or entitlements or other available sources.Permissible expenditures include, but are not limited to, dental, medical, and diagnostic work or treatment that is not otherwise available from public benefits or assistance; private rehabilitative training; supplementary education aid; entertainment; periodic vacations and outings; expenditures to foster the interests, talents, and hobbies of the beneficiary; and expenditures to purchase personal property and services that will make life more comfortable and enjoyable for the beneficiary but that will not defeat his or her eligibility for public benefits or assistance.The trustee, with consultation of the cotrustee, may make payments for a person to accompany the beneficiary on vacations and outings and for the transportation of the beneficiary or of friends and relatives of the beneficiary to visit the beneficiary;

(3)Expenditures of trust account funds shall not be made for the primary support or maintenance of the beneficiary, including basic food or shelter, if, as a result, the beneficiary would no longer be eligible to receive public benefits or assistance to which the beneficiary is then entitled;

(4)The cotrustee, with consent of the trustee, shall not less frequently than annually determine the amount of income or principal or income and principal which may be used to provide noncash benefits and the nature and type of benefits to be provided for the beneficiary.Any net income which is not used shall be added to the principal annually;

(5)In the event that the trustee and the cotrustee shall be unable to agree either on:

(a)The amount of income or principal to be used;

(b)The benefits to be provided; or

(c)The administration of the trust account,

then the cotrustee shall have the right to appeal the decision of the trustee in accordance with the rules and regulations established by the board.

(L. 2011 S.B. 70)

402.202 - Trust accounts, restricted trust accounts, charitable trust — administered as Missouri family trust — pooling permitted — additional board powers.

1.Trust accounts, restricted trust accounts, and the charitable trust shall be held and administered in trust as the Missouri family trust.The charitable trust, the restricted accounts and the trust accounts shall each be maintained in trust as separate accounts, but may be pooled for purposes of investment and management.Assets of the Missouri family trust shall not be considered state money, assets of the state or revenue for any purposes of the state constitution or statutes.

2.The board of trustees shall act as the trustee of the Missouri family trust.The board of trustees, as trustee, shall administer the Missouri family trust pursuant to the provisions of sections 402.199 to 402.208 and pursuant to the policies, procedures, rules, and regulations of the board of trustees.

3.In addition to the powers and duties granted to the board pursuant to sections 402.199 to 402.208, in its capacity as trustee of the trust the board shall have all powers granted to trustees acting under chapter 456, as now in effect or hereafter amended; provided, that section 456.8-813 regarding the duty to inform and report to the beneficiaries shall not apply to the trust, except as mandated under section 456.1-105.

(L. 2011 S.B. 70)

402.200 - Definitions.

As used in sections 402.199 to 402.208, the following terms mean:

(1)"Beneficiary", also referred to as "life beneficiary", a person who:

(a)Has been determined to have a disability or to be a disabled person;

(b)Is a resident of Missouri or one of the eight states adjacent to Missouri; and

(c)Is the person designated as the sole, primary beneficiary of a trust account administrated as part of the Missouri family trust by the board of trustees;

(2)"Board of trustees", "board", or "Missouri family trust board of trustees", the body corporate and instrumentality of the state, established as the Missouri family trust board of trustees pursuant to section 402.201;

(3)"Charitable trust", an account established and administered as part of the Missouri family trust for the benefit of disabled individuals, as provided in section 402.207;

(4)"Cotrustee", that person designated by the settlor to act together with the trustee as cotrustee of a trust account;

(5)"Department", the department of mental health;

(6)"Disability":

(a)A mental or physical impairment that substantially limits one or more major life activities, whether the impairment is congenital or acquired by accident, injury or disease, and where the impairment is verified by medical findings; or

(b)As is defined in Section 1614(a)(3) of the Social Security Act, 42 U.S.C. 1382c(a)(3);

(7)"Missouri family trust" or "trust", the trust established pursuant to section 402.202 and administered by the board of trustees, as trustee, pursuant to sections 402.199 to 402.208;

(8)"Net income", the earnings received on investments less administrative expenses and fees;

(9)"Principal balance", the fair market value of all contributions made to a particular account, less distributions, determined as of the end of the calendar month immediately preceding the occurrence giving rise to any determination of principal balance;

(10)"Remainder beneficiaries", the person or persons designated to receive the applicable portion of the principal balance of a trust account remaining after the death of the beneficiary;

(11)"Restricted account", an account established and administered as part of the trust for the benefit of persons with disabilities as provided in section 402.206;

(12)"Standby trust", the trust established upon distribution of a trust account by the board of trustees pursuant to notice of withdrawal or termination and administered as set forth in subsection 3 of section 402.205;

(13)"Trust account", an account established and administered as part of the Missouri family trust for the benefit of a beneficiary as provided in sections 402.203 and 402.204;

(14)"Trustee", the board of trustees acting in its capacity as trustee of a trust account, the charitable trust, or a restricted account as used in section 402.201.

(L. 1989 H.B. 318 § 1, A.L. 1991 S.B. 311, A.L. 1993 H.B. 136 merged with S.B. 338, A.L. 1998 S.B. 852 & 913, A.L. 1999 S.B. 211, A.L. 2004 H.B. 923, A.L. 2011 S.B. 70)

402.204 - Settlor may contribute assets — trust account created — cotrustees and successors — breach of fiduciary duty, effect of — death of beneficiary, procedure — remainder distribution.

1.Any person, as settlor, except a beneficiary or a beneficiary's spouse, may contribute assets not including assets of the beneficiary or the beneficiary's spouse in trust to the board as trustee, for the benefit of the beneficiary.Upon such contribution, the settlor's completion and execution of trust documents provided by the trustee, and the trustee's review, approval and execution of the trust documents, a trust account for the beneficiary shall thereby be created.A trust account to which assets that do not include assets of a beneficiary or of a beneficiary's spouse are contributed shall be referred to as a "third party trust account", and shall be held and administered in trust for the benefit of the beneficiary as provided in this section.

2.The settlor may designate a cotrustee, and a successor or successors to the co-trustee, to act together with the trustee as trustees of the third party trust account; provided that the beneficiary or the beneficiary's spouse may not act as cotrustee or successor cotrustee; and provided further that court approval of the beneficiary, cotrustee or successor trustee shall be required in connection with any third party trust account created pursuant to subsection 2 of section 473.657.

3.If the board determines, in its good faith judgment, that a cotrustee has breached his or her fiduciary duties, either as a result of an act of commission or omission, then the board may, by written notice to such cotrustee, remove such cotrustee, appoint a successor cotrustee, or serve as sole trustee.

4.At the death of the beneficiary, the board of trustees shall promptly determine the principal balance of the trust account and, after payment of any expenses of the beneficiary as the board may authorize and all fees and expenses of the board, shall distribute to the persons, entities, or organizations designated by the settlor as remainder beneficiaries in the trust documents:

(1)An amount equal to one hundred percent of the principal balance if the beneficiary shall not have received any benefits provided by use of trust account income or principal; or

(2)An amount equal to seventy-five percent of the principal balance if the beneficiary shall have received any benefits provided by use of trust account income or principal; and

(3)Any principal not distributed pursuant to the provisions of subdivision (2) of this subsection, and any undistributed income shall be distributed to the charitable trust established pursuant to the provisions of section 402.207;

(4)If any individual remainder beneficiary named by the settlor is not then living, then in the absence of contrary instructions in the trust documents completed by the settlor, such remainder beneficiary's share shall be distributed to such remainder beneficiary's heirs at law, as determined by the laws of the state of the beneficiary's residence at the time of the beneficiary's death.

5.Notwithstanding the provisions of subsection 4 of this section to the contrary, the settlor may voluntarily agree that a smaller percentage of the principal balance in any trust account established by such settlor than is provided in subsection 4 of this section be distributed to the remainder beneficiaries designated in the trust documents; and that a corresponding larger percentage of the principal balance in such trust account be distributed either to the charitable trust or to a designated restricted account within the charitable trust.

(L. 2011 S.B. 70)

402.208 - Fees authorized — periodic reports — no property interest in trust account, when.

1.The board may establish and collect fees for administering trust accounts established pursuant to the provisions of sections 402.199 to 402.220*.

2.The board shall establish policies and procedures for providing periodic reports to the cotrustees of each trust account established pursuant to the provisions of sections 402.199 to 402.220*.

3.(1)No beneficiary shall have any vested or property rights or interests in any trust account, nor shall any beneficiary have the power to anticipate, assign, convey, alienate, or otherwise encumber any interest in the income or principal of any trust account.

(2)The income or the principal or any interest of any beneficiary in the trust account shall not be liable for any debt incurred by such beneficiary, nor shall the principal or income of any trust account be subject to seizure by any creditor or any beneficiary under any writ or proceeding in law or in equity.

4.Except for the right of a settlor to withdraw from or revoke any revocable trust account under section 402.205, and the right of any acting cotrustee, other than the original settlor, to withdraw all or a portion of the principal balance of a revocable trust account under section 402.205, neither the settlor nor any acting cotrustee shall have the right to sell, assign, convey, alienate, or otherwise encumber, for consideration or otherwise, any interest in the income or principal of the trust account.The income or the principal or any interest of any beneficiary of a revocable trust account shall not be liable for any debt incurred by the settlor or any acting cotrustee, nor shall the principal or income of the trust account be subject to seizure by any creditor of any settlor or any acting cotrustee under any writ or proceeding in law or in equity.

(L. 2011 S.B. 70)

*Section 402.220 was repealed by S.B. 70, 2011.

402.138 - Release or modification of restrictions permitted, when.

1.If the donor consents in a record, an institution may release or modify, in whole or in part, a restriction contained in a gift instrument on the management, investment, or purpose of an institutional fund.A release or modification may not allow a fund to be used for a purpose other than a charitable purpose of the institution.

2.The court, upon application of an institution, may modify a restriction contained in a gift instrument regarding the management or investment of an institutional fund if the restriction has become impracticable or wasteful, if it impairs the management or investment of the fund, or if, because of circumstances not anticipated by the donor, a modification of a restriction will further the purposes of the fund.The institution shall notify the attorney general of the application, and the attorney general shall be given an opportunity to be heard.To the extent practicable, any modification shall be made in accordance with the donor's probable intention.

3.If a particular charitable purpose or restriction contained in a gift instrument on the use of an institutional fund becomes unlawful, impracticable, impossible to achieve, or wasteful, the court, upon application of an institution, may modify the purpose of the fund or the restriction on the use of the fund in a manner consistent with the charitable purposes expressed in the gift instrument.The institution shall notify the attorney general of the application, and the attorney general shall be given an opportunity to be heard.

4.If an institution determines that a restriction contained in a gift instrument on the management, investment, or purpose of an institutional fund is unlawful, impracticable, impossible to achieve, or wasteful, the institution, sixty days after notification to the attorney general, may release or modify the restrictions in whole or in part if:

(1)The institutional fund subject to the restriction has a total value of less than fifty thousand dollars;

(2)More than ten years have lapsed since the fund was established; and

(3)The institution uses the property in a manner consistent with the charitable purposes expressed in the gift instrument.

(L. 2009 H.B. 239)

402.130 - Definitions.

As used in sections 402.130 to 402.148, the following terms shall mean:

(1)"Charitable purpose", the relief of poverty, the advancement of education or religion, the promotion of health, the promotion of a governmental purpose, or any other purpose the achievement of which is beneficial to the community;

(2)"Endowment fund", an institutional fund or part thereof that, under the terms of a gift instrument, is not wholly expendable by the institution on a current basis.The term shall not include assets that an institution designates as an endowment fund for its own use;

(3)"Gift instrument", a record or records, including an institutional solicitation under which property is granted to, transferred to, or held by an institution as an institutional fund;

(4)"Institution":

(a)A person, other than an individual, organized and operated exclusively for charitable purposes;

(b)A government or governmental subdivision, agency, or instrumentality to the extent that it holds funds exclusively for a charitable purpose; or

(c)A trust that had both charitable and noncharitable interests after all noncharitable interests have terminated;

(5)"Institutional fund", a fund held by an institution exclusively for charitable purposes.It shall not include:

(a)Program-related assets;

(b)A fund held for an institution by a trustee that is not an institution; or

(c)A fund in which a beneficiary that is not an institution has an interest other than an interest that could arise upon violation or failure of the purposes of the fund;

(6)"Person", an individual, corporation, business trust, estate, trust, partnership, limited liability company, association, joint venture, public corporation, government or governmental subdivision, agency, or instrumentality, or any other legal or commercial entity;

(7)"Program-related asset", an asset held by an institution primarily to accomplish a charitable purpose of the institution and not primarily for investment;

(8)"Record", information that is inscribed on tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form.

(L. 2009 H.B. 239)

402.134 - Appropriation for expenditure or accumulation of endowment fund, amount permitted — factors to consider.

1.Subject to the intent of the donor expressed in the gift instrument, an institution may appropriate for expenditure or accumulate so much of an endowment fund as the institution determines is prudent for the uses, benefits, purposes, and duration for which the endowment fund is established.Unless otherwise stated in the gift instrument, the assets in an endowment fund are donor-restricted assets until appropriated for expenditure by the institution.In making a determination to appropriate or accumulate, the institution shall act in good faith with the care that an ordinary prudent person in a like position would exercise under similar circumstances and shall consider, if relevant, the following factors:

(1)The duration and preservation of the endowment fund;

(2)The purposes of the institution and the endowment fund;

(3)General economic conditions;

(4)The possible effect of inflation or deflation;

(5)The expected total return from income and the appreciation of investments;

(6)Other resources of the institution; and

(7)The investment policy of the institution.

2.To limit the authority to appropriate for expenditure or accumulate under subsection 1 of this section, a gift instrument shall specifically state the limitation.

3.Terms in a gift instrument designating a gift as an endowment, or a direction or authorization in the gift instrument to use only "income", "interest", "dividends", or "rents, issues or profits", or "to preserve the principal intact", or words of similar import:

(1)Create an endowment fund of permanent duration unless other language in the gift instrument limits the duration or purpose of the fund; and

(2)Do not otherwise limit the authority to appropriate for expenditure or accumulate under subsection 1 of this section.

(L. 2009 H.B. 239, A.L. 2014 H.B. 1523)

Effective 6-10-14

402.144 - Compliance, determined when.

Compliance with sections 402.130 to 402.148 is determined in light of the facts and circumstances existing at the time a decision is made or action is taken and not by hindsight.

(L. 2009 H.B. 239)

402.140 - Applicability.

Sections 402.130 to 402.148 shall apply to institutional funds existing on or established after August 28, 2009.

(L. 2009 H.B. 239)

402.148 - Governing boards and directors, law not to amend duties and liabilities of.

Nothing in sections 402.130 to 402.148 shall act to amend the status of governing boards or the duties and liabilities of directors under other applicable law.

(L. 2009 H.B. 239)

402.205 - Withdrawal from trust account, when — revocation or termination of trust, when, distribution — trust principal and income held for benefit of beneficiary.

1.The settlor of a revocable third party trust account or the cotrustee of a revocable third party trust account if authorized by the settlor in the trust documents, upon written notice to the board and with the board's consent may, from time to time, withdraw such part of the trust account as the settlor or such authorized cotrustee may determine; provided, however, neither the settlor nor such authorized cotrustee may withdraw an amount that when aggregated with all withdrawals within the prior twelve months shall reduce the remaining principal balance of the trust account below the greater of the amount due the board, if the trust account had terminated at the time of such withdrawal or the minimum amount required by the board, from time to time, for an account.

2.The settlor of a revocable third party trust account or the cotrustee of a revocable third party trust account if authorized by the settlor in the trust documents, upon written notice to the board and with the board's consent may revoke and terminate the trust account.Upon receipt of such notice, the board shall promptly determine the principal balance of the trust account and after payment of all fees and expenses of the board shall distribute:

(1)In the case of revocation and termination by the settlor:

(a)An amount equal to one hundred percent of the principal balance to the settlor if the beneficiary shall not have received any benefits provided by use of trust account income or principal; or

(b)An amount equal to seventy-five percent of the principal balance to the settlor if the beneficiary shall have received any benefits provided by use of trust account income or principal; and

(c)Any principal not distributed pursuant to the provisions of paragraph (b) of this subdivision, and any undistributed income to the charitable trust;

(2)In the case of revocation and termination by an authorized cotrustee:

(a)An amount equal to one hundred percent of the principal balance shall be distributed to the trustees of the standby trust, if the beneficiary shall not have received any benefits provided by use of trust account income or principal, to be held, administered, and distributed in accordance with the provisions of subsection 3 of this section; or

(b)An amount equal to seventy-five percent of the then-principal balance shall be distributed to the trustees of the standby trust, if the beneficiary shall have received any benefits provided by use of trust account income or principal, to be held, administered, and distributed in accordance with the provisions of subsection 3 of this section; and

(c)Any principal not distributed pursuant to the provisions of paragraph (b) of this subdivision, and any undistributed income shall be distributed to the charitable trust.

3.The trustee or trustees of the standby trust shall hold, administer, and distribute the principal and income of the standby trust, in the discretion of such trustee, for the support, health, education, and general well-being of the beneficiary during the beneficiary's life, recognizing that it is the purpose of the standby trust to supplement, not replace, any government benefits for the beneficiary's basic support to which such beneficiary may be entitled and to increase the quality of such beneficiary's life by providing the beneficiary those amenities which cannot otherwise be provided by public assistance or entitlements or other available sources.Permissible expenditures include, but are not limited to, those described in subdivision (2) of section 402.206.

(L. 1989 H.B. 318 § 2, A.L. 1991 S.B. 311, A.L. 1999 S.B. 211, A.L. 2004 H.B. 923, A.L. 2011 S.B. 70)

402.201 - Board of trustees created, members, expenses — accounting of funds required — assets not state moneys — immunity from liability, when.

1.There is hereby created the "Missouri Family Trust Board of Trustees", which shall be a body corporate and an instrumentality of the state, and which shall be incorporated as a Missouri general not-for-profit corporation.The board of trustees is authorized to apply for and qualify for recognition as an exempt organization pursuant to Section 501(c)(3) of the United States Internal Revenue Code of 1986, as amended.

2.The board of trustees shall consist of nine members who are natural persons appointed by the governor with the advice and consent of the senate.The members' terms of office shall be three years and until their successors are appointed and qualified.The members shall be persons who are not prohibited from serving by sections 105.450 to 105.482.The board shall be composed of the following:

(1)Three members of the immediate family of persons who have a disability of mental illness.The department's state advisory council for comprehensive psychiatric services, created pursuant to section 632.020, shall submit a panel of nine proposed members of the board to the governor, from which the governor shall appoint three.One shall be appointed for a term of one year, one for two years, and one for three years.Thereafter, as the term of a member of the board appointed under this subdivision expires each year, the state advisory council for comprehensive psychiatric services shall submit to the governor a panel of not less than three nor more than five proposed members of the board of trustees, and the governor shall appoint one member from such panel for a term of three years;

(2)Three members of the immediate family of persons who have a developmental disability.The department's Missouri planning council for developmental disabilities, created pursuant to section 633.020, shall submit a panel of nine proposed members of the board to the governor, from which the governor shall appoint three.One shall be appointed for a term of one year, one for two years, and one for three years.Thereafter, as the term of a member of the board appointed under this subdivision expires each year, the Missouri planning council for developmental disabilities shall submit to the governor a panel of not less than three nor more than five proposed members of the board of trustees, and the governor shall appoint one member from such panel for a term of three years; and

(3)Three persons recognized for their expertise in general business matters and procedures.Of the three business persons to be appointed by the governor, one shall be appointed for one year, one for two years, and one for three years.Thereafter, as the term of a member of the board of trustees appointed under this subdivision expires each year, the governor shall appoint one business person as member for a term of three years.

3.As used in subdivisions (1) and (2) of subsection 2 of this section, "immediate family" includes spouse, parents, parents of spouse, children, spouses of children, and siblings.

4.No member of the board of trustees shall receive compensation for services as a member of the board.The board shall reimburse the members of the board for necessary expenses actually incurred in the performance of their duties.

5.The board of trustees shall be subject to the provisions of sections 610.010 to 610.029 and is considered a public governmental body under section 610.010.

6.The board of trustees shall annually prepare or cause to be prepared an accounting of funds administered by the board and shall transmit a copy of the accounting to the governor, the president pro tempore of the senate and the speaker of the house of representatives.

7.The board of trustees shall establish policies, procedures, and other rules and regulations necessary to implement the provisions of sections 402.199 to 402.208.

8.The board of trustees is authorized to advise, consult with, coordinate and render services to those departments, agencies, political subdivisions, and governmental instrumentalities of Missouri and of the states adjacent to Missouri, and those not-for-profit organizations that qualify as organizations pursuant to Section 501(c)(3) of the United States Internal Revenue Code of 1986, as amended, that provide services or support to persons with disabilities who are residents of Missouri or one of the states adjacent to Missouri.

9.The assets of the board of trustees shall not be considered state money, assets of the state or revenue for any purposes of the state constitution or statutes.The property of the board of trustees and its income and operations shall be exempt from all taxation by the state or any of its political subdivisions.

10.No trustee or any member of the board of trustees, cotrustee, or successor cotrustee serving pursuant to the provisions of sections 402.200 to 402.208 shall at any time be held liable for any mistake of law or fact, or of both law and fact, or errors of judgment, nor for any loss sustained as a result thereof, unless such trustee, cotrustee, or successor cotrustee acted in bad faith or with reckless indifference to the terms of the trust or the interest of the beneficiary.