Summary of Senate Bill 19: Guardianship, Conservatorship, and Other Arrangements Act – Part II

This is the second part of a 2-part series about Senate Bill 19 in New Mexico. The second part will discuss the effect of the changes the new provisions of Senate Bill 19 has on the Guardianship and Conservatorship statute for individuals with special needs.

Effect of the changes to the G&C statute for individuals with special needs:

The changes to New Mexico’s Guardianship and Conservatorship statute attempts to include more potentially- interested parties in the proceeding. It also opens hearings to make the process more accessible by potentially-interested parties. The new changes also attempt to contain the circumstances whereby the protected person becomes isolated from interested parties by other interested parties. The changes also provide for greater protection of the property of incapacitated individuals by mandating bonding, prohibiting the waiver of a conservator’s liability, and adding the option for auditing.

On one hand these measures are good, but on the other hand, they reduce the privacy of the alleged incapacitated person, increase the cost of proceedings, and make the ongoing accountability to the court more cumbersome for families. The repercussions of indefinite liability is going to result in fewer corporate fiduciaries being willing to take on conservatorships, limiting the pool of competent third-party conservators when family members are not able or appropriate to serve.

Important for families whose disabled children will continue to reside in the home while receiving SSI, there has been no change to the statute that restricts a guardian with financial authority from using funds of the alleged incapacitated person for room and board provided by the guardian, the guardian’s spouse, parent or child, unless ordered by the court, with notice to at least one next of kin. It is important in situations where guardianship with financial authority is granted to have the court authorize the payment of room and board to the guardian or their family to avoid running afoul of the statute or face a one-third reduction of SSI for In-kind support and maintenance (ISM).

Other legislation from the current legislative session that impacts the special needs community is SB 137 which made changes to the Trust Company Act. This legislation comes in the wake of fiduciary misconduct by a trust company and aims to strengthen protections for consumers by increasing capital requirements and bonding by trust companies. The definition of a nonprofit organization was limited to apply only to pooled special needs trusts, which are not subject to the more stringent requirements.