Sen. Brian Pettyjohn

Sections 1 and 2 of this Act update Chapter 8 of Title 12, the Uniform TOD Security Registration Act. Section 1 of this Act does the following: (1) Adds a new definition to § 801 of Title 12 to define “cash equivalents”. (2) Amends the definition of “registering entity” in § 801 of Title 12 to confirm that registering entities may include securities dealers, banks, savings banks, trust companies, investment advisers, and other financial institutions that maintain securities accounts for customers. (3) Amends the definition of “security” in § 801 of Title 12 to confirm that interests in or obligations of a corporation; a limited liability company or any series of a limited liability company; a partnership, whether general or limited, or any series of a partnership; and a trust, including a common law trust, a voting trust, a business trust, or a statutory trust, or any series of a trust, constitute a “security” for purposes of the Unform TOD Security Registration Act. (4) Amends the definition of “security account” in § 801 of Title 12 to make ministerial changes to the language of the definition and to expand the definition to include investment management accounts, securities accounts, custody accounts, or other agency accounts for the investment or custody of securities maintained with a bank, a savings bank, a trust company, a securities dealer, an investment adviser, or other financial institution. Section 2 of this Act amends § 805 of Title 12 to confirm that registration in beneficiary form with respect to an uncertificated security or a security account need not include the names of beneficiaries if the names of all beneficiaries are otherwise maintained by the registering entity. This avoids, for example, any requirement for the book entry of an uncertificated security or the name of a security account to include the names of all beneficiaries, so long as the registering entity otherwise maintains the names of such beneficiaries. Sections 1 and 2 of this Act are not intended to override provisions of an entity’s operating agreement or governing provisions, and will take effect subject to any implementing requirements of the agreement or governing provisions, such as transfer or ownership restrictions. Sections 3 and 4 of this Act pertain to “letters of wishes” by trustors and add a new definition to § 3301 of Title 12 and a new subsection to § 3315 of Title 12. Letters of wishes have long been created by trustors as a means of assisting fiduciaries to understand the discretionary terms of the trust’s governing instrument, to understand the application of those terms as intended by trustors, and to assist fiduciaries to exercise distribution discretion. Accordingly, Sections 3 and 4 of this Act acknowledge existing and common practice by affirming that the standard of review of a fiduciary’s decision to consider or not to consider a letter of wishes is the same “abuse of discretion” (within the meaning of § 187 of the Restatement (Second) of Trusts, not §§ 50 and 60 of the Restatement (Third) of Trusts) standard described in § 3315 of Title 12. The new provisions recognize that a letter of wishes is a non-binding document intended to provide guidance and insight into the trustor’s intent relevant to a particular trust. New subsection (c) of § 3315 of Title 12 specifically provides 3 safe harbors for determining that a fiduciary has not abused its discretion, by stating that the following do not constitute an abuse of that fiduciary’s discretion: (1) the fiduciary’s decision not to consider a letter of wishes with respect to an unambiguous provision of the trust’s governing instrument; (2) the fiduciary’s decision not to consider a letter of wishes not meeting the criteria of the new subsection (c) of § 3315 of Title 12; and (3) the fiduciary’s decision to consider a letter of wishes meeting the criteria of the new subsection (c) of § 3315 of Title 12, with respect to an ambiguous provision of a trust’s governing instrument. In addition, the new subsection (c) of § 3315 of Title 12 provides that the letter of wishes is not binding on the fiduciary, that the fiduciary has no duty to follow the letter of wishes, and that the fiduciary’s exercise or non-exercise of a discretionary power does not create an inference that the fiduciary improperly exercised such power or abused the fiduciary’s discretion under § 3315(a) of Title 12. Sections 3 and 4 of this Act, however, are not intended to override the Court of Chancery’s decision in Bishop v. McNeil, 1999 Del. Ch. LEXIS 186, 1999 WL 743489 (Del. Ch. 1999), in which the Court declined to take into account a letter to construe the provisions of an unambiguous governing instrument for a trust because the letter was extrinsic evidence of trustor intent. Thus, Sections 3 and 4 of this Act are not intended to affect the law regarding the Court’s interpretation of unambiguous governing instruments for trusts, for which the Court may not consider extrinsic evidence, or to affect the law regarding the Court’s interpretation of ambiguous governing instruments for trusts, for which the Court may consider extrinsic evidence, including any such letter of wishes. Section 5 of this Act adds new paragraph (32) to § 3325 of Title 12 to provide trustees of trusts with a statutory power to hire, retain, and compensate providers of programs and education for trust beneficiaries that may help prepare the beneficiaries for inheriting wealth, by helping to develop wealth-management skills, enhance beneficiary mental health and well-being, particularly as those areas may be impacted by the trust itself, and to reduce the potential for the trust to disincentivize the beneficiaries’ productivity or impact their mental health or well-being. The trustee may provide these programs and services or may hire and pay third parties or affiliates from the trust estate to provide these services and, in each case, without diminution of the trustee’s regular compensation to which the trustee would otherwise be entitled to receive for serving as trustee. Section 6 of this Act amends § 3339 of Title 12, regarding designated representatives, to do all of the following: (1) Provide specifically that when a trustor appoints a designated representative for beneficiaries, the appointment may be with respect to beneficiaries who are minors, who are incapacitated, who are unborn, or whose identities or locations are not known and not reasonably ascertainable. (2) Make clearer that when notice of the appointment is required to be given to parents of the represented person or to a guardian of the property of the represented person, the requirement applies only to those beneficiaries who are minors or who are incapacitated. Section 7 of this Act adds new § 3345 of Title 12 to enable trustors to create what is to be known as a “Beneficiary Well-Being Trust” by expressly referencing § 3345 of Title 12 in the trust’s governing instrument. Section 3345 of Title 12 recognizes a growing concern of trustors that while there are many advantages to passing wealth through generations in trust, such as tax savings, creditor protection, consolidated investment and management, and protection of assets from imprudent waste, trusts may grow in value so that considerable wealth may become available to the beneficiaries, sometimes before beneficiaries have had an opportunity to learn and know the value of money and the personal and social responsibilities that access to wealth entails. The purpose of the Beneficiary Well-Being Trust is to provide wealth management training and services for the beneficiaries’ mental health and well-being and to educate beneficiaries about their family history and legacy, family values and dynamics, family governance, and philanthropy, all as more fully described in § 3345 of Title 12. The governing instrument of a Beneficiary Well-Being Trust may provide for additional powers, duties, rights, and interests of the beneficiaries, trustees, and advisers to the fullest extent permissible under § 3303 of Title 12. The trustees and advisers of a Beneficiary Well-Being Trust may provide beneficiary well-being programs or may hire and pay third parties or affiliates from the trust estate to provide beneficiary well-being programs and, in each case, without diminution of the trustee’s or adviser’s regular compensation to which the trustee or adviser would otherwise be entitled to receive for serving as trustee or adviser. Section 8 of this Act amends § 3547 of Title 12, regarding virtual representation, to extend the principles of the section by allowing a designated representative of a beneficiary under § 3339 of Title 12 to represent virtually those whom the beneficiary could virtually represent, including, under the circumstances already permitted under § 3547 of Title 12, someone who is a minor, is incapacitated, is unborn, or whose identity or location is not known and not reasonably ascertainable; a presumptive remainder beneficiary of a trust; a contingent successor remainder beneficiary of a trust; the holder of a power of appointment over a trust; or the beneficiaries of a trust that is itself the beneficiary of another trust, if there is not a material conflict of interest between the designated representative and those who are to be virtually represented. Section 9 of this Act provides an effective date for this Act and makes clear that this Act applies to trusts created before, on, or after the effective date of this Act.

This Act revises existing animal cruelty laws to include people who knowingly possess, own, buy, sell, transfer, or manufacture animal fighting paraphernalia with the intent to engage in or otherwise promote or facilitate such fighting as guilty of a class E felony. This Act defines “animal fighting paraphernalia” and creates a list of considerations a court may use when assessing whether an item or object qualifies as animal fighting paraphernalia.

This Act enacts the Interstate Teacher Mobility Compact (ITMC). The Council of State Governments partnered with the Department of Defense and the National Association of State Directors of Teacher Education and Certification (NASDTEC) to support the mobility of licensed teachers through the development of this new interstate compact. The ITMC will create reciprocity among participant states and reduce barriers to license portability and employment. The Interstate Teacher Mobility Compact (ITMC) is an interstate occupational licensure compact. Interstate compacts are constitutionally authorized, legislatively enacted, legally binding agreements among states. The ITMC will allow teachers to use an eligible license held in a compact member state to be granted an equivalent license in another compact member state, lowering barriers to teacher mobility and getting teachers back into the classroom more seamlessly. The ITMC utilizes a different model than other interstate occupational licensure compacts. Compact member states submit licenses that are eligible for the compact and meet a set of criteria outlined in the legislation. To be eligible, a license must require a bachelor’s degree and completion of a state-approved program for teacher licensure like a teacher preparation program at a college or university. Furthermore, for a license to be eligible under the ITMC, the license must be unencumbered, which means it is not restricted, probationary, provisional, substitute, or temporary. Teachers holding a compact-eligible license can apply for licensure in another member state and receive the closest equivalent license without submitting additional materials, taking state-specific exams or completing additional coursework. Special carveouts were created for some populations in the ITMC to support equitable access. Due to the mobility patterns of military spouses, the barriers to receiving a license that would be considered unencumbered under the compact are much higher. Teachers meeting the definition of an eligible military spouse will be able to use a temporary or provisional license for the purposes of the ITMC. Career and Technical Education Teaching Licenses often do not require a bachelor’s degree as a requirement for licensure, so the compact allows these licenses to be considered eligible without that requirement. The ITMC will not close any existing pathways to teacher licensure or teacher mobility. The ITMC aims to provide additional tools to state licensing authorities to more efficiently license out of state teachers and get them into the classroom. State licensing authorities will also appoint their state’s representatives to the Interstate Teacher Mobility Compact Commission, which serves as the administrative body of the ITMC. In addition to the NASDTEC, the following organizations contributed to the development process for the ITMC: • National Association of Elementary School Principals. • American Association of Colleges for Teacher Education. • National Education Association. • Council of Chief State School Officers. • Education Commission of the States. • Southern Regional Education Board. • American Association of School Administrators. • National Conference of State Legislatures. • National Association of State Boards of Education. • National Governors Association. • National Council on Teacher Quality. • National School Boards Association. The ITMC must be enacted in 10 states to become effective. The ITMC has been enacted in 8 states and legislation to enact it is pending in 13 states.

This Act clarifies portions of Chapter 49 of Title 6 and Chapter 63 of Title 21 of the Delaware Code pertaining to motor vehicle dealers. These additions and modifications are intended to further improve our State’s franchise laws and ensure that Delaware consumers have a stable, reliable, convenient, and competitive retail network for automobile sales and service. This Act is an effort to continue to ensure that the relationship between dealers and the manufacturers and distributors is as fair and equitable as possible and provides the highest level of consumer protection. The Act includes the following provisions: Definitions. The Act amends § 4902 of Title 6 and clarifies the definitions of “motor vehicle” and “new motor vehicle” to reflect technological advances and changes in industry business practices in the state, and adds a definition of “electric motor vehicle”. The Act defines the new terms “sell,” "selling," "sold," "exchange," "retail sales," and "leases". Warranty and Predelivery Obligations to New Motor Vehicle Dealers. Dealers are required by contract to perform warranty work for manufacturers. The Act amends § 4903 of Title 6 in order to ensure that dealers are fairly paid for performing manufacturer-directed repairs related to warranty repairs, maintenance programs and recall work. Intrusive Audits. Dealers are required by existing law to wait up to 30 days for payment for motor vehicle warranty repairs in order to allow the manufacturer to review and approve payment submissions. Manufacturers are also allowed to later audit such repairs and payments. The Act affords manufacturers a full 6 months to audit warranty claims but will reasonably prevent intrusive and time-consuming audits after 180 days, unless the audit involves cases of alleged fraud. Franchise Termination Compensation. Under existing law, manufacturers must repurchase certain motor vehicles, parts and special tools in the event of the termination of the dealer’s franchise agreement. The Act amends § 4907 of Title 6 and specifies a 90-day timeframe for payment and clarifies that it is the manufacturer’s responsibility to cover the cost of returns. Return of Unnecessary Tools & Equipment. The Act allows a dealer a limited opportunity to return and be reimbursed for the cost of certain tools and equipment that were required as a part of an electric vehicle program or agreement between that dealer and the manufacturer, if the dealer determines within two years after receipt that such tools and equipment are unnecessary or that sales volume and utilization are low enough to prevent the dealer from realizing a reasonable return on those forced investments. Failure or Refusal of Manufacturer to Accept Returns. The Act amends § 4913 of Title 6 by providing that it violates Chapter 49 for a manufacturer to fail or refuse to accept the return or to fully reimburse a dealer for the cost of parts, tools, equipment, chargers and other infrastructure required under the franchise agreement, or as part of a program, policy, or other initiative related to the sale or service of electric motor vehicles. Sale & Subscription of Over-the-Air Features. The Act allows manufacturers to directly sell options, add-ons, features, improvements and upgrades by remote transmission to consumers, provided that the dealers are afforded an equal opportunity to sell the same products and services, and further provided that the manufacturer reasonably compensates the dealer for direct sales or subscriptions to the dealer’s customers for a specified period of time. Association Standing. The Act adds a new § 4920 to Title 6 on the subject of Association Standing. Franchise laws have been enacted in all 50 states to recognize compelling state interests in protecting consumers and in regulating the disparity in bargaining power between motor vehicle manufacturers and their franchised dealers. Because dealers have a single source for their new motor vehicles, parts and accessories, many are reluctant to raise a single voice to object to unlawful activity by their manufacturer. The Act grants statutory standing to a large association of dealers to bring a legal action, in very limited circumstances, to ensure compliance with applicable law. Licensing. The Act amends provisions of §§ 6301 and 6302 of Title 21 of the Delaware Code related to the Sale of Motor Vehicles. The Act adds definitions of “new motor vehicle,” “new motor vehicle dealer,” “used motor vehicle,” and “used motor vehicle dealer” to § 6301. Section 6302 is amended to provide that a manufacturer, importer, or distributor who was licensed as a motor vehicle dealer is not eligible to receive any additional licenses. The Act is supported by the Delaware Automobile and Truck Dealers’ Association, Inc.

This Act ensures that educators hired after the effective date of this Act, who earned graduate degrees prior to becoming educators, receive credit on the salary schedule for those degrees regardless of the specific subject area of those degrees. Once an individual is employed as an educator, in order to receive credit for any graduate degrees earned after that time, such degree must be in the subject area in which the educator is employed.

This Act repeals the DELJIS Fund fee imposed on criminal defendants. The elimination of this fee was recommended by the Criminal Legal System Imposed Debt Study Group created by House Bill 244, as amended by House Amendment No 2, of the 151st General Assembly, in its December 7, 2023 report. Any outstanding balances owed for this fee shall be discharged upon the Act’s effective date. Per the Study Group’s recommendation, the Act will become effective upon the specific appropriation of General Fund monies to replace DELJIS’s full spending authority of the repealed fee.

This Act repeals the Senior Trust Fund Fee, the Interstate Compact Fee, and the Substance Abuse, Rehabilitation, Treatment, Education and Prevention Fund Fee imposed on criminal defendants. The elimination of these fees was recommended by the Criminal Legal System Imposed Debt Study Group created by House Bill 244, as amended by House Amendment No 2, of the 151st General Assembly, in its December 7, 2023 report. The Criminal Legal System Imposed Debt Study Group also recommended replacement of lost revenue for affected agencies as needed with General Funds. In repealing these fees, the General Assembly also intends to eliminate any outstanding balances owed on these fees.

This Act allows a county that imposes a lodging tax to spend money from that tax on workforce and affordable housing programs. This bill also makes technical corrections to conform existing law to the standards of the Delaware Legislative Drafting Manual.

The State’s Medicaid Plan still limits the reimbursement of Medicaid-covered, school-based behavioral health services to those provided under an Individualized Educational Program (IEP) or Individualized Family Service Plan (IFSP), despite federal policy changes that allow for these services to be provided as a medical necessity without IEP or IFSP documentation. This bill would charge the Department of Health & Social Services to apply to the Centers for Medicare and Medicaid Services for a State Plan Amendment that would allow for reimbursement of medically necessary behavioral health services without IEP or IFSP documentation. Local education agencies must use the reimbursed funds to further invest in school-based behavioral health supports. This House Substitute differs from the original HB 5 in that the deadline for application for a State Plan Amendment is extended to January 1, 2025. It also allows the Department of Education, the administrator of all reimbursements, to retain up to 5% of federal reimbursement dollars in order to defray administrative costs. Remaining funds shall be reimbursed to the local education agencies providing the services.

This Act is a result of the work of the Delaware Interscholastic Athletic Association (“DIAA”) Task Force (“Task Force”). The 152nd Delaware General Assembly passed Senate Concurrent Resolution 19 establishing the Task Force to study and make findings and recommendations to best address the needs of student athletes and ensure DIAA’s effective and efficient functioning. The Task Force met over 8 months to discuss the most pressing issues facing DIAA. This Act addresses one of the identified issues: the waiver process when a student transfers from one school to another and wishes to play interscholastic athletics. Under current regulations, a student who transfers schools and wishes to participate in sports must complete a period of ineligibility unless the student meets certain conditions or qualifies for an exception. In order to meet the conditions or exception or otherwise request a waiver of ineligibility, the student must go through a waiver process. The student applies for a waiver, DIAA’s Executive Director makes an interim decision on the waiver, and the DIAA Board of Directors (“Board”) ratifies or rejects the Executive Director’s interim decision. If the Board has any questions about any part of the waiver application or interim decision, they reject the interim decision and schedule a hearing for the student to testify to answer the additional questions. By the time the Board issues a final decision on the waiver, the student has lost time to play sports and the Board has spend a great deal of its meeting time on the hearing, including going into executive session to maintain a student’s privacy. Among other matters relating to the waiver process, the Task Force discussed the amount of time that the waiver process takes, both from the students’ and Task Force’s perspective, and how to make the process more efficient and more equitable for the students. The Task Force concluded that moving the waiver process out of regulations and into the Delaware Code is the most efficient way to streamline the process, thereby benefitting student athletes and allowing the Board more time to focus on its other work. This Act is a combination of existing regulations, regulations that the Board proposed but were not enacted during the 8 months that the Task Force met, and the Task Force’s discussions on how to best improve the waiver process. Under this Act, the Executive Director makes the final decision on a waiver, subject to an appeal of a 3-member panel comprised of Board members. Shifting the final decision-making to the Executive Director removes duplicative steps, and specifying deadlines are to ensure as speedy a conclusion as possible. The Executive Director must issue their decision within 15 days of receiving a waiver, and a student may appeal the decision to the appeals panel within 15 days of receiving the decision. The appeals panel must issue its decision within 30 days of receiving an appeal. The appeals panel may not hold a hearing on an appeal or otherwise ask questions of a student who seeks an appeal; the panel must make its decision based on the documentation that the Executive Director used to make their decision. This Act organizes the process into the following categories: - Immediate eligibility applies to circumstances under which a student is immediately eligible to participate in sports at the school into which the student transfers (“receiving school”). A waiver is not required for immediate eligibility. Immediate eligibility applies if the student has not previously played the sport the student seeks to play at the receiving school, if the student has been placed in the custody of the Department of Services for Children, Youth and their Families, or it is the student’s first transfer and the student did not play the sport during the 180 days prior to transferring. The receiving school of a student who qualifies for immediate eligibility must initiate the completion of a tracking form, to document the transfer and reason for immediate eligibility. - Periods of ineligibility apply to a student’s subsequent transfer. A student is subject to a period of ineligibility of 30 days or ½ of the maximum number of contests, whichever is less. A student may seek a waiver of the period of ineligibility. - Exceptions to periods of ineligibility are provided in this Act. A student who meets an exception is not required to seek a waiver, but must provide documentation relevant to the exception. Seven types of exceptions are available, including transferring schools due to homelessness, court action, or a change in the student’s residence due to military assignment. Each exception has its own requirements. - Defining the waiver process, including deadlines, required documentation, and the factors required for granting a waiver. To approve a waiver, the Executive Director must consider the 4 factors under § 315(a), Title 14. The 4 factors do not include “hardship,” which has been a factor under the current regulations. The Task Force discussed that the hardship factor was too often an unreasonably difficult standard for a student to meet, resulting in a large percentage of the waivers sought and failing to meet the purpose of the ineligibility and waiver process, which is to discourage transfers for athletic reasons, multiple transfers, or transfers after a sports season has begun. The remaining 4 factor do meet this purpose. This Act also makes technical corrections to conform existing law to the standards of the Delaware Legislative Drafting Manual.