Bill Text: CA SB1031 | 2011-2012 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

---

Bill Title: Budget Act of 2012.

Spectrum: Unknown

Status: (Engrossed - Dead) 2012-08-29 - In Senate. Concurrence in Assembly amendments pending. [SB1031 Detail]

Download: California-2011-SB1031-Amended.html

---

BILL NUMBER: SB 1031	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  JUNE 13, 2012

INTRODUCED BY   Committee on Budget and Fiscal Review

                        FEBRUARY 6, 2012

    An act relating to the Budget Act of 2012.  
An act to amend Section 12975.9 of the Insurance Code, relating to s
  eismic safety, and declaring the urgency thereof, to take
effect immediately. 



	LEGISLATIVE COUNSEL'S DIGEST


   SB 1031, as amended, Committee on Budget and Fiscal Review.
 Budget Act of 2012.   Seismic Safety Account:
funding.  
   Existing law establishes the Seismic Safety Commission to perform
specified duties relating to earthquake hazard reduction and other
seismic safety issues. Existing law also provides for the Seismic
Safety Account within the Insurance Fund. Money in the account may be
appropriated by the Legislature to fund the Seismic Safety
Commission and certain administrative costs incurred by the
Department of Insurance. Existing law provides for assessments levied
against certain insurers to be deposited in the Seismic Safety
Account. Under existing law, the provisions establishing the Seismic
Safety Account and authorizing these assessments expire on July 1,
2012.  
   This bill would require the department, instead, to calculate an
annual assessment to be charged to each commercial and residential
property exposure in an amount set annually by the department based
on specified factors, including the amount required for the support
of the Seismic Safety Commission and the collection and
administrative costs of the department, not to exceed $0.15 per
property exposure. The bill would require the insurer to collect the
assessment and remit it to the department unless the insurer elects
to pay the assessment on the insured's behalf. The bill would extend
the operation of these provisions indefinitely.  
   This bill would declare that it is to take effect immediately as
an urgency statute.  
   This bill would express the intent of the Legislature to enact
statutory changes relating to the Budget Act of 2012. 
   Vote:  majority   2/3  . Appropriation:
no. Fiscal committee:  no   yes  .
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

   SECTION 1.    Section 12975.9 of the  
Insurance Code   is amended to read: 
   12975.9.  (a) The Seismic Safety Account is hereby created as a
special account within the Insurance Fund. Money in the account may
be appropriated by the Legislature for the purposes of this section
to fund the department and the Seismic Safety Commission. 
Assessments imposed on insurers as a prorated percentage of premiums
earned on property exposures for both commercial and residential
insurance policies relative to the aggregate premiums earned on those
exposures by all insurers shall be deposited in the account. The
premiums earned for property exposures shall be as stated on lines 4
and 5.1 of the annual statement filed by each insurer pursuant to
Section 900. The assessments shall be set annually based on earned
premiums reported for the next preceding year by the department and
calculated so that the funds in the account shall be sufficient to
fund appropriations for support of the Seismic Safety Commission, for
the actual collection and administrative costs of the department,
and for the maintenance of an adequate reserve. The department shall
submit the proposed assessments to the Seismic Safety Commission for
its review at a regularly scheduled meeting of the commission.
  The department shall calculate an annual assessment to
be charged to each commercial and residential property exposure. The
assessment shall be set annually based on the number of property
exposures from both   commercial and residential insurance
policies, the amount required for the support of the Seismic Safety
Commission, the actual collection and administrative costs of the
department, and for the maintenance of an adequate reserve. The
annual assessment shall not exceed fifteen cents ($0.15) pe 
 r property exposure.  
   (b) No assessment shall be levied on insurers with less than one
hundred thousand dollars ($100,000) of annual direct premiums earned
on property exposures for both commercial and residential insurance
policies. The department may adjust this amount as necessary to
minimize costs by excluding assessment amounts that are too small to
justify the cost of assessment and collection or if assessment or
collection is impractical.  
   (c) 
    (b)  An insurer  , in its discretion, may
  shall  recover this assessment  in an
equitable fashion  from the insured  unless the insurer
elects to pay the assessment on the insured's behalf  . The
insurer  , upon receipt of an invoice,  shall
transmit payment to the department for deposit in the Seismic Safety
Account. Any deficiency or excess in the amount collected in relation
to the appropriation authority for the commission and the department
shall be accounted for in the subsequent annual fee calculation. Any
balance remaining in the Seismic Safety Account at the end of the
fiscal year shall be retained in the account and carried forward to
the next fiscal year. 
   (d) 
    (c)  Funds in the Seismic Safety Account shall be
distributed, upon appropriation, to the Seismic Safety Commission for
the support of the commission and to the department for the actual
administrative costs incurred in collecting the assessments. 

   (e) 
    (d)  The department shall report annually to the
Legislature, the Seismic Safety Commission, and the Department of
Finance on the assessment calculation methodology employed. 
   (f) This section shall become inoperative on July 1, 2012, and, as
of January 1, 2013, is repealed, unless a later enacted statute,
that becomes operative on or before January 1, 2013, deletes or
extends the dates on which it becomes inoperative and is repealed.

   SEC. 2.    This act is an urgency statute necessary
for the immediate preservation of the public peace, health, or safety
within the meaning of Article IV of the Constitution and shall go
into immediate effect. The facts constituting the necessity are:
 
   In order to continue to provide programs for seismic safety and to
provide guidance for earthquake preparedness at the earliest
possible time, it is necessary that this bill take effect
immediately.  
  SECTION 1.    It is the intent of the Legislature
to enact statutory changes relating to the Budget Act of 2012.