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Arkansas Code Title 23. Public Utilities and Regulated Industries § 23-93-112. Establishment of interest-bearing escrow account

Current as of March 28, 2024 | Updated by Findlaw Staff

(a)(1) The Insurance Commissioner shall require that the provider establish an interest-bearing escrow account with a financial institution authorized to do business in this state. Any entrance fees or payments received by the provider prior to the date the resident is permitted to occupy the living unit in the facility shall be placed in the escrow account.

(2) Release of escrowed amounts to the provider shall be made as follows:

(A) For living units that have been previously occupied, at the time the new resident makes the first monthly payment; or

(B) For living units not previously occupied, at the earliest to occur of one (1) of the following:

(i) When aggregate fees received or receivable equal fifty percent (50%) of total entrance fees due at full occupancy, except that any entrance fee payments that are less than thirty-five percent (35%) of the amount due from a resident will not be counted;

(ii) When entrance fees plus the proceeds of any first mortgage or other long-term loan in lieu of a first mortgage, plus other funds on hand, equal fifty percent (50%) of the total cost of the facility plus fifty percent (50%) of the start-up losses shown in the provider's application submitted under § 23-93-207; or

(iii) When a permanent mortgage or other long-term loan commitment has been received and the mortgagee's commitment conditions prior to disbursement, other than completing construction and closing the purchase, have been satisfied.

(b) If the funds in an escrow account and any interest earned on the funds are not released within thirty-six (36) months, or such greater time as may have been specified by the provider with the consent of the commissioner, then the funds shall be returned by the escrow agent to the persons who made the payment to the provider.

(c) Nothing in this section shall require the escrow of any nonrefundable application fees charged to prospective residents.

(d) An entrance fee held in escrow may be returned by the escrow agent at any time to the person or persons who paid the entrance fee to the provider upon receipt by the escrow agent of notice from the provider that such a person is entitled to a refund of the entrance fee.

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Cite this article: FindLaw.com - Arkansas Code Title 23. Public Utilities and Regulated Industries § 23-93-112. Establishment of interest-bearing escrow account - last updated March 28, 2024 | https://codes.findlaw.com/ar/title-23-public-utilities-and-regulated-industries/ar-code-sect-23-93-112/

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