Following approval in the California Senate, a proposed law that would strengthen financial protections for child actors is on its way to the desk of Gov. Gray Davis for signature.
The measure — essentially an amendment of the 61-year-old Coogan Law — passed the Senate by a 39-0 vote on Thursday after legislators considered and approved revisions made to it in the Assembly.
Most significantly, the law specifies that at least 15% of a child actor’s earnings be placed in a court-monitored trust account to which the actor would have sole access upon reaching maturity.
Previously, the set-aside provision applied only to child actors whose employment contracts had been approved by a court. While such a situation was common decades ago, these days very few contracts are so approved.
The measure also forces parents or guardians to be trustees of all the minor’s earnings, with the stipulation that the money be used primarily “for the child’s benefit,” said Margie Estrada, an aide to Sen. John Burton (D-San Francisco), the bill’s author. Co-authors are Sheila Kuehl (D-Santa Monica), who was a child actress, and Scott Wildman (D-Burbank), whose children are actors.
All the money earned would be “the minor’s sole legal property,” a change from existing law, which states that a parent is entitled to the earnings of a minor.
Money in the trust fund is to be invested in “low-risk financial vehicles,” the law states, with no withdrawals until the child turns 18.
The Coogan Law was passed in 1938 in response to the plight of child actor Jackie Coogan, who discovered upon reaching adulthood that he was broke, his mother and stepfather having spent $4 million of his money.
Similar cases abound. After years as a major star, Shirley Temple ended up with just a few thousand dollars and the deed to her dollhouse in the back yard of her parents’ Beverly Hills home; Macaulay Culkin’s considerable earnings supported his large family until a court wrested control of the money from his feuding parents; and Gary Coleman’s parents structured his pension fund so that, when it was dissolved, his share was $220,000, while his parents’ was $770,000.
“This bill, it is hoped, would finally protect children in the entertainment industry from exploitation by their own parents or guardians,” states a summary of the measure.