28 TAC §1.415
The Commissioner of Insurance adopts an amendment to §1.415,
concerning assessment of a maintenance tax surcharge authorized under Texas
Insurance Code, Article 5.76-5, for the Texas Workers' Compensation Fund.
The funds collected by the surcharge are used to service the bonded indebtedness
of the Texas Workers' Compensation Insurance Fund. The section is adopted
without changes to the proposed text as published in the March 26, 1999, issue
of the
Texas Register
(24 TexReg 1999).
The amendment is required to reflect the Texas Workers' Compensation Insurance
Fund's decision to defease $63.2 million of its outstanding bonded indebtedness
from the Fund's accumulated earnings. As a result of the decision, this year
the Fund does not need the funds collected from the maintenance tax surcharge
to service its bonded indebtedness.
On January 7, 1999, the commissioner adopted an assessment rate of .350%
of an insurer's correctly reported gross workers' compensation insurance premiums
for the calendar year 1998. This rate would have collected funds sufficient
to pay current debt service on the bonds issued on behalf of the Texas Workers'
Compensation Fund. As a result of the Fund's decision to prepay the above
- referenced amount out of its accumulated earnings, no funds are needed from
the maintenance tax surcharge; therefore the rate of assessment is reduced
to 0.0% by this amendment. As a result of the amended section, the Comptroller
of Public Accounts will refund an estimated $10,708,389 of insurer payments
made pursuant to the previously adopted 1999 workers' compensation insurance
maintenance tax surcharge.
No comments were received.
The amendment is adopted under the Insurance Code, Articles 5.76-3,
5.76-5, 5.68 and 1.03A and the Texas Labor Code, §403.002. The Insurance
Code, Article 5.76-3 establishes the Texas Workers' Compensation Insurance
Fund. Article 5.76-5 establishes the maintenance tax surcharge. Article 5.68
establishes the maintenance tax based on premiums for workers' compensation
coverage. Article 1.03A authorizes the commissioner to adopt rules and regulations
for the conduct and execution of the duties and functions of the department
as authorized by statute. The Texas Labor Code, §403.002 establishes
the maintenance tax for workers' compensation insurance companies.
This agency hereby certifies that the adoption has been reviewed
by legal counsel and found to be a valid exercise of the agency's legal authority.
Filed with the Office of the Secretary of State on April
30, 1999.
TRD-9902569
Lynda H. Nesenholtz
General Counsel and Chief Clerk
Texas Department of Insurance
Effective date: May 20, 1999
Proposal publication date: March 26, 1999
For further information, please call: (512) 463-6327