Do Arkansas state agencies have to turn over unclaimed property to the Auditor of State just like private companies do?

Plain-English summary

State Auditor Andrea Lea asked the AG whether state agencies, boards, commissions, and other political subdivisions of Arkansas were legally obligated to comply with the Arkansas Unclaimed Property Act (Act 850 of 1999, codified at Ark. Code Ann. §§ 18-28-201 to -231) and whether the Auditor had statutory enforcement authority against those entities.

The AG concluded the answer to both questions was generally yes. The Act creates a holder-reporting and remittance system: anyone holding unclaimed property must report it to the Auditor of State and deliver it for safekeeping. The Act's text reaches state and local government entities by its express definitions and operational provisions.

Why governmental entities are "holders": Section 18-28-201(6) defines "holder" as "a person obligated to hold" property for its owner. Section 18-28-201(12) defines "person" to include any "government, governmental subdivision, agency, or instrumentality." Putting those two definitions together, any state agency or political subdivision holding property for an owner is a holder. And the Act's abandonment rules expressly include "property held by a court, government, governmental subdivision, agency, or instrumentality," confirming that governments are within the system.

Why the Auditor can enforce: The Act gives the administrator (the Auditor of State) authority to maintain actions to enforce the subchapter against holders (§ 18-28-219(b), -222) and to require reports and examine records (§ 18-28-220). When a governmental entity is a holder, those enforcement powers apply.

The AG noted the answers were "generally" yes because there may be exceptions in specific contexts (the opinion did not address particular kinds of property or particular agencies). Op. Att'y Gen. 97-107 had previously found that "outlawed state warrants" were not subject to the version of the Act then in effect, illustrating that the general answer leaves room for particular exclusions.

Currency note

This opinion was issued in 2015. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Background and statutory framework

The Arkansas Unclaimed Property Act establishes a unified system for reporting and remittance of abandoned and unclaimed property. The Auditor of State administers the system. The Act applies broadly: "holder" is anyone obligated to hold property for an owner, "person" includes governments and governmental subdivisions, and "property held by a court, government, governmental subdivision, agency, or instrumentality" is expressly within the system's scope.

The Auditor's enforcement toolkit includes the power to require reports from holders, examine holders' records, and bring actions to enforce the subchapter (Ark. Code Ann. §§ 18-28-219(b), -220, -222). When the holder is a governmental entity, those tools apply.

The opinion is intentionally framed at a high level. The AG declined to address any particular state agency, office, or kind of property. The "generally yes" framing is meant to set the default while preserving room for case-specific exceptions.

Common questions

Does a state agency have to report unclaimed wages on a former employee?

Under this opinion, generally yes. A state agency that holds property for an owner is a "holder" under the Act and must follow the reporting/remittance rules just like a private holder.

Does the Auditor of State have to audit state agencies for unclaimed property compliance?

The Act's enforcement provisions (§ 18-28-220) give the Auditor authority to require reports and examine records. Whether and how the Auditor audits is a discretionary administrative decision.

Are there any exceptions for governmental holders?

The AG explicitly preserved room for exceptions, pointing to Op. Att'y Gen. 97-107 (outlawed state warrants not subject to the version of the Act then in effect). For specific property types or agencies, the analysis is case-specific.

What about political subdivisions like counties and cities?

The Act's definitions reach all "governmental subdivision[s]" and "instrumentalit[ies]," which the AG read to include political subdivisions. Counties, cities, and similar entities are within the system.

Citations

• Ark. Code Ann. §§ 18-28-201 to -231 (Arkansas Unclaimed Property Act)
• Ark. Code Ann. § 18-28-201(6) (definition of holder)
• Ark. Code Ann. § 18-28-201(12) (definition of person, including government)
• Ark. Code Ann. § 18-28-219(b) (Auditor's enforcement actions)
• Ark. Code Ann. § 18-28-220 (Auditor's power to require reports and examine records)
• Ark. Code Ann. § 18-28-222 (Auditor's enforcement actions)
• Act 850 of 1999 (origin of the Act)
• Op. Att'y Gen. 97-107 (outlawed state warrants exception under prior Act version)

Source

• Landing page: https://arkansasag.gov/divisions/opinions-foia/attorney-general-opinions-search/

Original opinion text

Opinion No. 2015-087
October 6, 2015
The Honorable Andrea Lea
Auditor of State
STATE OF ARKANSAS
ATTORNEY GENERAL
LESLIE RUTLEDGE
500 Woodlane Street, Suite 230
Little Rock, AR 72201-1096
Dear Auditor Lea:
This is my opinion on your questions about the Arkansas Unclaimed Property Act (the "Act"):

1. Do state agencies, boards, commissions, and other political subdivisions of the State of Arkansas have a legal obligation to comply with the Act?
2. If the answer is "yes," does the Auditor of State have the statutory authority to enforce the Act in regard to state agencies and other political subdivisions of the State of Arkansas?

RESPONSE

In my opinion, the answer to both your questions is generally "yes."

DISCUSSION

Question 1: In my opinion, the answer to this question is generally "yes." The Act establishes a scheme under which holders of unclaimed property must make a report to the Auditor of State, and deliver the property to the Auditor of State to be held in the State's custody and safekeeping. State agencies, boards, commissions, and other political subdivisions of the State of Arkansas are generally subject to this Act.

The Act defines "holder" as "a person obligated to hold" property for its owner. The Act defines "person" to include, among others, any "government, governmental subdivision, agency, or instrumentality ...." It contains a rule about when "property held by a court, government, governmental subdivision, agency, or instrumentality" is deemed abandoned, thus expressly contemplating governments' participation in the unclaimed-property system. Accordingly, in my opinion, any State agency, board, commission, or political subdivision that holds unclaimed property otherwise subject to the Act is a "person" and a "holder" as defined by the Act, and is generally obligated to comply with the Act.

(You have not asked about, and this opinion does not address, any particular governmental entity or office, or type of property. In responding to such a general inquiry, I can offer no assurance that there are no exceptions to the general rule stated. See, e.g., Op. Att'y Gen. 97-107 (opining that "outlawed state warrants" were not subject to the reporting and remittance rules of the version of the Act then in effect).)

Question 2: In my opinion, the answer to this question is generally "yes." The Act gives you, as Auditor of State (and therefore administrator of the unclaimed-property scheme) certain powers to enforce the Act. See, e.g., Ark. Code Ann. §§ 18-28-219(b) (referring to administrator's power to maintain action "to enforce this subchapter" against holders), -220 (describing administrator's powers to require reports from holders and to examine holders' records), -222 ("administrator may maintain an action ... to enforce this subchapter"). To the extent a governmental entity holds property subject to the Act, it is a "holder" as defined in the Act and accordingly is generally subject to your enforcement authority thereunder.

Sincerely,
Attorney General