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H0396........................................................by MR. SPEAKER
Requested by: Department of Insurance
INSURANCE REFUND ACCOUNT - Amends existing law to allow for deposits to the
Insurance Refund Account by the director of the Department of Insurance of
up to twenty percent of taxes, fines and penalties as needed to meet
current refund obligations.
01/17 House intro - 1st rdg - to printing
Rpt prt - to Bus
02/10 Rpt out - rec d/p - to 2nd rdg
02/11 2nd rdg - to 3rd rdg
02/14 3rd rdg - PASSED - 67-0-3
AYES -- Alltus, Barraclough, Barrett, Bell, Bieter, Black, Boe,
Bruneel, Callister, Campbell, Chase, Cheirrett, Clark, Crow, Cuddy,
Deal, Denney, Ellsworth, Field(13), Field(20), Gagner, Gould, Hadley,
Hammond, Hansen(23), Hansen(29), Henbest, Jaquet, Jones, Judd,
Kellogg, Kempton, Kendell, Kunz, Lake, Loertscher, Mader, Marley,
McKague, Meyer, Montgomery, Mortensen, Moss, Moyle, Pearce, Pischner,
Pomeroy, Reynolds, Ridinger, Ringo, Robison, Sali, Schaefer, Sellman,
Shepherd, Smith, Smylie, Stevenson, Stoicheff, Stone, Taylor, Tilman,
Trail(Miller), Wheeler, Wood, Zimmermann, Mr Speaker
NAYS -- None
Absent and excused -- Geddes, Hornbeck, Linford
Floor Sponsor - Taylor
Title apvd - to Senate
02/15 Senate intro - 1st rdg - to Com/HuRes
03/08 Rpt out - rec d/p - to 2nd rdg
03/09 2nd rdg - to 3rd rdg
03/21 3rd rdg - PASSED - 33-0-2
AYES--Andreason, Boatright, Branch, Bunderson, Burtenshaw, Cameron,
Crow, Danielson, Darrington, Davis, Deide, Dunklin, Frasure, Geddes,
Hawkins, Ingram, Ipsen, Keough, King-Barrutia, Lee, McLaughlin, Noh,
Parry, Riggs, Risch, Schroeder, Sorensen, Stegner, Stennett, Thorne,
Wheeler, Whitworth, Williams
NAYS--None
Absent and excused--Richardson, Sandy
Floor Sponsor - McLaughlin
Title apvd - to House
03/22 To enrol
03/23 Rpt enrol - Sp signed
03/24 Pres signed
03/27 To Governor
03/29 Governor signed
Session Law Chapter 64
Effective: 03/29/00
H0396|||| LEGISLATURE OF THE STATE OF IDAHO |||| Fifty-fifth Legislature Second Regular Session - 2000IN THE HOUSE OF REPRESENTATIVES HOUSE BILL NO. 396 BY MR. SPEAKER Requested by: Department of Insurance 1 AN ACT 2 RELATING TO THE DEPARTMENT OF INSURANCE; AMENDING SECTION 41-406, IDAHO CODE, 3 TO ALLOW FOR DEPOSITS TO THE INSURANCE REFUND ACCOUNT OF UP TO TWENTY PER- 4 CENT OF TAXES, FINES AND PENALTIES AS NEEDED TO MEET CURRENT REFUND OBLI- 5 GATIONS; AND DECLARING AN EMERGENCY. 6 Be It Enacted by the Legislature of the State of Idaho: 7 SECTION 1. That Section 41-406, Idaho Code, be, and the same is hereby 8 amended to read as follows: 9 41-406. DEPOSIT AND REPORT OF FEES, LICENSES AND TAXES. (1) The director 10 shall transmit all taxes, fines and penalties collected by him to the state 11 treasurer as provided under section 59-1014, Idaho Code. The director shall 12 file with the state controller a statement of each deposit thus made. All such 13 funds received shall be deposited into the department of insurance suspense 14 account. 15 Such funds shall be distributed as follows: 16 (a)Ten percent (10%) shall be depositedThe director may deposit up to 17 twenty percent (20%) of the funds received in the insurance refund account 18 which is hereby created for the purpose of repaying overpayments of any 19 taxes, fines, and penalties or other erroneous receipts. There is hereby 20 appropriated out of the insurance refund account so much thereof as shall 21 be necessary for the payment of refunds. Any unencumbered balance remain- 22 ing in the insurance refund account on June 30 of each and every year in 23 excess of forty thousand dollars ($40,000) shall be transferred to the 24 general account and the state controller is hereby authorized and directed 25 on such dates to make such transfers unless the board of examiners, which 26 is hereby authorized to do so, changes the date of transfer or sum to be 27 transferred. 28 (b) That portion of the premium tax, payable to the public employee 29 retirement account as provided in section 59-1394, Idaho Code, shall be 30 distributed to that account. 31 (c) That portion of the premium tax necessary to cover administrative 32 costs incurred by the department in placing insurance companies or any 33 other insurance entities into receivership or under administrative super- 34 vision, and such costs cannot be satisfied from the assets of these compa- 35 nies or entities, shall be distributed to the insurance insolvency admin- 36 istrative account which is hereby created. There is hereby appropriated 37 out of the insurance insolvency administrative account so much thereof as 38 shall be necessary, but not to exceed two hundred thousand dollars 39 ($200,000) in any one (1) fiscal year, for the payment of the department's 40 administrative expenses incurred in carrying out such receiverships or 41 supervisions. A balance of one hundred thousand dollars ($100,000) shall 42 be maintained in this account on June 30 of each year. 43 (d) The balance of the premium tax, fines and penalties shall be distrib- 2 1 uted to the general account of the state of Idaho. 2 (e) All moneys received for fees, licenses and miscellaneous charges col- 3 lected shall be distributed to the insurance administrative account. 4 (2) The director shall make and file with the state controller an item- 5 ized statement of the fees, licenses, taxes, fines and penalties collected by 6 him during the preceding month, and shall deliver a certified copy of the 7 statement to the state treasurer. 8 SECTION 2. An emergency existing therefor, which emergency is hereby 9 declared to exist, this act shall be in full force and effect on and after its 10 passage and approval.
STATEMENT OF PURPOSE
RS09382
Idaho Code 41-406(1)(a) requires that ten percent (10%) of the taxes,
fines and penalties the Department of Insurance collects be deposited in
the Insurance Refund Account to be used to repay overpayments. In recent
years, the 10% set aside has not provided sufficient funding to meet the
State's obligation to refund overpayments. As a result of this
deficiency, current year obligations are pushed into subsequent years.
The proposed legislation would allow the Director of the Department of
Insurance to increase the amount set aside to meet refund obligations in
order to address the continuing deficiency and make certain that refund
obligations are met on a timely basis. The Director could set aside up
to 20% of taxes, fines and penalties to fund the Insurance Refund
Account. The law requires that any unencumbered balance in excess of
$40,000 in the Refund Account as of June 30 each year be transferred to
the general fund.
FISCAL IMPACT
It is expected that increasing the amount of revenues going into the
Refund Account from 10% to the 20% maximum would enable the State to
become current on its insurance refund obligations during FY 2001. This
would decrease revenue paid into the general fund by approximately
$3,100,000 in FY 2000. If the legislation is not adopted, this amount
will represent a liability of the State of Idaho that will continue to
be carried forward into subsequent years.
CONTACT
Name: Bob Murphy
Agency: Department of Insurance
Phone: 208-334-4250
Statement of Purpose/Fiscal Impact H0396