(2) “Beneficiary with a disability” means a beneficiary of a first trust who the special needs fiduciary reasonably believes qualifies for governmental benefits based on disability, whether or not the beneficiary currently receives governmental benefits or has been adjudicated incapacitated.

(3) “Governmental benefits” means financial aid or services from a State, federal, or other public agency.

(4) “Special needs fiduciary” means, with respect to a trust that has a beneficiary with a disability:

(i) A trustee or other fiduciary, other than a settlor, that has discretion to distribute part or all of the principal of a first trust to one or more current beneficiaries;

(ii) If no trustee or fiduciary has discretion under item (i) of this paragraph, a trustee or other fiduciary, other than a settlor, that has discretion to distribute part or all of the income of the first trust to one or more current beneficiaries; or

(iii) If no trustee or fiduciary has discretion under item (i) or (ii) of this paragraph, a trustee or other fiduciary, other than a settlor, that is required to distribute part or all of the income or principal of the first trust to one or more current beneficiaries.

(5) “Special needs trust” means a trust that the trustee reasonably believes would not be considered a resource for the purpose of determining whether a beneficiary with a disability is eligible for governmental benefits.

(b) A special needs fiduciary may exercise the decanting power over the principal of a first trust as if the fiduciary had authority to distribute principal to a beneficiary with a disability subject to expanded distributed discretion, if:

(1) A second trust is a special needs trust that benefits the beneficiary with a disability; and

(2) The special needs fiduciary determines that the exercise of the decanting power will further purposes of the first trust.

(c) Notwithstanding any provision to the contrary, in an exercise of the decanting power under this section:

(1) The interest in a second trust of a beneficiary with a disability may, but is not required to:

(i) Be a pooled trust, as defined in Title 42 of the United States Code, for a beneficiary with a disability; or

(ii) Contain payback provisions complying with the requirements for reimbursement in Title 42 of the United States Code;

(2) A second trust may reduce or eliminate a vested interest of a beneficiary with a disability; and

(3) Except as affected by any change to the interests of the beneficiary with a disability, a second trust, or second trusts in the aggregate, shall grant each other beneficiary of the first trust beneficial interests in the second trusts that are substantially similar to the beneficiary’s beneficial interests in the first trust.