HARRISBURG – Legislation is headed to the governor’s desk which would provide protections for annuitants who are donors to a charity that provides for Charitable Gift Annuities. Those annuities provide donors the opportunity to support a charitable organization while receiving fixed annuity payments. The payments can begin immediately or the donor can defer the payments to a future date. The terms of the arrangement are set forth in a contract signed by the non-profit and the donor. The arrangement terminates on the death of the annuitant, at which point the non-profit uses the remaining funds on its mission. Bill sponsor, Sen. Bob Mensch said it’s difficult for smaller charitable groups to utilize Charitable Gift Annuities under current law, because the amount of unrestricted cash or publicly traded securities needed to cover the minimum is impractical and unworkable. Senate Bill 731 would amend the Charitable Gift Annuity Exemption Act to allow charities to transfer their risk to a commercial insurance company, which will match substantially all future payments of the charity arising from a charitable gift annuity contract obligation.

SEN. BOB MENSCH