Master Pooled Trust

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Master Pooled Trust
The Arc of Minnesota

• A service of The Arc of Minnesotaand affiliated
  chapters throughout Minnesota
• 1-800-582-5256
• www.TheArcOfMinnesota.org

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History of The Arc of Minnesota
History of The Arc of Minnesota

• Established in 1946 by parents of children with
  developmental disabilities, The Arc of Minnesota
  is a resource for families to come together and
  advocate for a better life for their loved ones.
  The Arc is committed to progressive legislation
  to protect rights and improve services for people
  with developmental disabilities. The Arc of
  Minnesota is the leading advocacy organization
  for persons with developmental disabilities and
  their families.  The Arc of Minnesota and
  chapters are affiliated with The Arc of The
  United States.

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History continued

• Working to close state institutions, allowing
  former residents to live successfully in the
  community.
• Leading the fight to allow all children to attend
  public schools. 
• Ensuring all infants and toddlers with
  disabilities receive early intervention
  services. 
• Fighting for legislation and funding to provide
  Medicaid waivers for home and community based
  services.

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History continued

• Through public education, The Arc has changed
  minds and proved that people with developmental
  disabilities can and do live as our neighbors,
  work in businesses, and play in the community.
• Assisting families with their consumer controlled
  Housing.
• The Arc Master Trust allowing families to
  provide financially for their loved ones after
  their death or inability to care for loved ones,
  and allowing people with disabilities to
  establish their own trust.

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Types of Special Needs Trusts SNT

• SNTs Special and Supplemental Needs Trusts can
  provide a person with a disability with financial
  resources, w/o jeopardizing eligibility for
  government benefits.
• Special 1st Party
  Supplemental 3rd Party
• A Master Pooled Trust is another type of SNT.
• Master All clients use the same Trust
  document.
• Pooled Trust, funds are pooled for
  investment and management purposes, but each
  enrolled beneficiary has his or her own account,
  like a checking accounts at a bank.

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History of Master Pooled Trust

• The Arc of Indiana 3rd Party (Family Funded)
  Master Pooled Trust was founded in 1988 to allow
  families to provide for their loved ones after
  they are gone or unable.
• The Arc of Indiana 1st Party (self-funded) Master
  Pooled Trust was established in 1995 to allow
  persons with disabilities to fund their own
  trust.
• The Arc of Minnesota follows the models perfected
  by the Arc of Indiana.
• The Arc of the United States was instrumental in
  establishing the federal legislation that allowed
  for the creation of trusts by people with
  disabilities.

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Master Pooled Trust Today Team

• Arc Mn MPT Began May 1, 2009
• Dennis Collins serves as the Trust Director
• Served 10 yrs as its Housing Consultant and Dir
  of Business Initiatives.
• The Arc of Indiana, with its 20 years of MPT
  experience has agreed to provide guidance to The
  Arc of Minnesotas MPT.
• Bremer Bank (Trust Dept) is the Trust Funds
  Manager.
• Allen Thiel Legal Counselor Partner _at_ Thiel,
  Campbell, Gunderson Anderson

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The Arc of Minnesota Master Pooled Trust

• The Arc of Minnesota offers two Master Pooled
  Trusts
• 1st Party 3rd Party
• 1st Party Trusts Funded by the person with a
  disability, using their own money (also called
  Self-Funded, Self-Settled or Medicaid Payback
  Trusts).
• 3rd Party Trusts Most often funded by parents,
  grandparents or other relatives.
• Both trusts can enhance a persons quality of
  life by providing items that are not funded by
  governmental programs.
• Arc Trust funds are deposited, secured and
  managed by Bremer Trust N.A. where the Arc
  maintains two accounts, Invested Non-invested

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Funding 3rd Party Trusts

• Most parents grandparents (the donors) fund
  their loved ones 3rd Party Trust account upon
  their death through a will, living trust, or
  life insurance policy.
• Some 3rd Party Trusts are funded during the
  donors lifetime.
• Or a combination of the two.

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Arcs Master Trust What Parents are looking for

• Continuity Arc of Minnesota founded in 1946,
  remains a stable, vibrant organization. Longevity
  and a future.
• Dependability We have been here for families
  for 50years, and will continue to be here.
  Ethical and trust worthy.
• Affordability The Arc Master Pooled Trust is an
  affordable option. Private Trusts are more
  expensive to create. Individually managed bank
  trusts typically must be relatively large, often
  starting at 300,000. Funding minimums are
  dramatically less in The Arc Master Trust.

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3rd Party Trust The Spending
Targetand Remaindermen

• A 3rd Party account is typically set up to be
  spent over the beneficiarys projected lifetime,
  thus creating an annual spending target.
  Remember our GOAL is that all funds will be spent
  during the beneficiarys lifetime.
• When the beneficiary passes away, any funds
  remaining in their Trust account pass on to
  whomever was designated by the donor to receive
  the funds these are called the remaindermen.
  

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What happens if my child lives beyond life
expectancy, and all funds are spent from the
trust account?

• A goal within the Their Heritage (3rd Party)
  Trust is to continue to provide for an
  individual who lives beyond their life expectancy
  and has thus has depleted his or her account, a
  Life-Time support goal
• Maximum continued support from Arc would be at
  the previous spending target. Minimum would be
  dictated by availability of funds in the
  Remainder Account.

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Does the 3rd Party Account require any funds that
remain after the death of the beneficiary to go
to The Arc?

• Yes 10. This retainage will be the funding
  source for the Remainder Account feeding the
  Life-Time support goal.
• You also can designate additional remainder funds
  to a local Arc Chapter or The Arc of MN, but this
  is not a requirement.

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1st Party Trust

• Thanks in part to the leadership of The Arc of
  The United States, Congress passed legislation in
  1993 that made it possible for a person with a
  disability to fund their own trust, and remain
  eligible for government benefits.

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Why would a person with a disability fund their
own trust?

• If a person with a disability receives an
  inheritance, or a lump sum back payment from
  social security, or a personal injury legal
  settlement, etc, these funds may make them
  ineligible for government benefits.
• Funds can be placed in a 1st Party trust to keep
  their government benefits, and allow the funds to
  be spent wisely over time.

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Is there a minimum or maximum that can be placed
in a 1st Party Trust?

• There is no required minimum, but typically
  accounts are funded with several thousand
  dollars.
• An account can be started with as little as the
  cost of the enrollment fee.

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Does the 1st Party Trust require a remainder to
be left to The Arc?

• 1st Party Trusts have a 10 remainder requirement
  Heres Why
• Federal law requires that any funds left in a
  trust funded by a person with a disability must
  go back to the state to reimburse the state for
  Medicaid funds spent on that person. If any
  funds are left after Medicaid has been
  reimbursed, funds can then pass on to an heir
  but it would be very rare for any funds to be
  left.
• Federal law allows that if the Trust is
  administered through a not-for-profit like The
  Arc, the organization can retain a portion of any
  funds left, before any pay back to the state.
  The Arc Master Trust retains only 10 of any
  funds remaining, and the other funds go back to
  repay the state for Medicaid funds spent on that
  person.

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What does The Arc do with funds retained from 1st
Party Trusts?

• Funds will be used to assure 3rd Party Trust
  beneficiaries who outlive their projected
  lifetime and deplete their accounts continue to
  receive benefits.
• Excess funds will be used to support the ongoing
  advocacy work of The Arc to benefit people with
  disabilities in Minnesota.

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How can SNTs be used?

• The trust can pay for dental care, eye care, or
  medical expenses not covered by Medicaid or other
  insurance.
• The trust can pay for school tuition,
  communication aids, cable television, phone and
  Internet service, transportation, clothing,
  household items, furniture, vacations,
  entertainment, gifts, donations to church and
  many other specific items.

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How often can Trust funds be used?

• The Trustee fee allows for 20 disbursement checks
  per year, plus an unlimited number of recurring
  bills such as cable, phone, internet, etc., plus
  Project Payments and Key Person reimbursements
  count only as 1 disbursement each.
• Additional disbursements can be negotiated.

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How are requests for disbursements made?

• Requests are easy to make and are usually made
  over the phone.

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What are the fees?

• Fees
• A one-time Enrollment fee.
• An annual Renewal fee that is paid until the
  trust is funded. Stops upon funding. Keeps
  account information up-to-date. Waived if in a
  Arc Futures program.
• An annual Trustee fee is paid once the trust is
  funded. This fee comes from the trust account.
• An Annual Management fee paid to Bremer Trust
  N.A. for investment of Pooled funds.

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The Arc Trust Expertise

• The Arc will report all Trust expenditures,
  disbursements, and income to appropriate
  governmental agencies to comply with
  requirements, and avoid loss of benefits.
• The Arcs will report to Pooled sub-account
  information to Donors, Key Persons and or
  beneficiaries.
• Arc will maintain records, provide and file Tax
  returns as required

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Contact The Arc of
Minnesota Master Pooled Trust

• The Arc Master Pooled Trust800 Transfer Road,
  Suite 7A
• St. Paul, MN. 55114
• 651-523-0823 1-800-582-5256
• Trust Director Dennis Collins
• DennisC_at_arcmn.org
• www.TheArcOfMinnesota.org