0001| SENATE BILL 590 | 0002| 42ND LEGISLATURE - STATE OF NEW MEXICO - SECOND SESSION, | 0003| 1996 | 0004| INTRODUCED BY | 0005| DUNCAN SCOTT | 0006| | 0007| | 0008| | 0009| | 0010| | 0011| AN ACT | 0012| RELATING TO STATE AGENCY FUNDS; PROVIDING FOR DEPOSIT AND | 0013| INVESTMENT OF CERTAIN FUNDS; MAKING AN APPROPRIATION. | 0014| | 0015| BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO: | 0016| Section 1. Section 10-2-16 NMSA 1978 (being Laws 1978, | 0017| Chapter 132, Section 4, as amended) is amended to read: | 0018| "10-2-16. SURETY BOND FUND.-- | 0019| A. There is created ~~[in the state treasury]~~ a | 0020| "surety bond fund". The fund and any income from the fund shall | 0021| be held in trust, deposited in a segregated account and invested | 0022| by the department with the prior approval of the state board of | 0023| finance. | 0024| B. Money deposited in the surety bond fund may be | 0025| expended by the department: | 0001| (1) to provide surety bond coverage; | 0002| (2) to create a retention fund to cover all or | 0003| any portion of the surety bond risks of state agencies and | 0004| covered educational entities; | 0005| (3) to pay claims of state agencies and covered | 0006| educational entities covered by a surety bond certificate of | 0007| coverage issued by the department; and | 0008| (4) to pay any costs and expenses of carrying | 0009| out the provisions of this section. | 0010| C. Claims against the surety bond fund shall be made | 0011| in accordance with a certificate of coverage issued by the | 0012| department to each state agency and covered educational entity. | 0013| If the secretary has reason to believe that the surety bond fund | 0014| would be exhausted by the payment of all claims allowed against | 0015| the fund during a particular state fiscal year, the amounts paid | 0016| for each claim shall be prorated with each state agency and | 0017| covered educational entity receiving an amount equal to the | 0018| percentage that its claims bear to the total of claims | 0019| outstanding and payable from the fund. Any amounts due and | 0020| unpaid as a result of such proration shall be paid in the | 0021| following fiscal years. | 0022| D. The department shall collect or transfer funds | 0023| from each state agency and covered educational entity to cover | 0024| costs of coverage of employees of the agency as required by this | 0025| section. Money collected or transferred from a state agency or | 0001| covered educational entity pursuant to this subsection shall be | 0002| deposited in the surety bond fund. | 0003| E. The department may provide individual surety bond | 0004| coverage protecting employees who are employers or supervisors | 0005| from personal losses for which they may be responsible, which | 0006| losses were caused by the lack of honesty or faithful | 0007| performance of employees under their supervision or control. | 0008| F. The department shall have the right to recover | 0009| from a public employee for any loss under the Surety Bond Act | 0010| for which the public employee was responsible. | 0011| G. The risk management advisory board shall review: | 0012| (1) specifications for all surety bond coverage | 0013| to be purchased by the department; | 0014| (2) the form and legal sufficiency of any | 0015| surety bond coverage to be purchased by the department; and | 0016| (3) the form, purpose and content of any surety | 0017| bond certificate of coverage to be issued by the director." | 0018| Section 2. Section 13-5-1 NMSA 1978 (being Laws 1981, | 0019| Chapter 101, Section 1, as amended) is amended to read: | 0020| "13-5-1. STATE AGENCY PUBLIC PROPERTY--INSURANCE--RESERVES | 0021| FOR LOSSES OF STATE AGENCIES--PUBLIC PROPERTY RESERVE FUND | 0022| CREATED.-- | 0023| A. The risk management division of the general | 0024| services department shall purchase a blanket insurance policy | 0025| for public buildings of state agencies against loss or damage by | 0001| fire, windstorm, hail, smoke, explosion, riot or civil | 0002| commotion. The risk management division may provide coverage to | 0003| covered educational entities under the public property reserve | 0004| fund through blanket or individual policies. The risk | 0005| management division shall create a reserve for the uninsured | 0006| value of any such public building and for the uninsured loss or | 0007| damage to any such building by flood, subject to any deductible | 0008| ~~[which]~~ that the risk management advisory board determines | 0009| shall be borne by individual state agencies or covered educa- | 0010| tional entities. | 0011| B. Subject to any deductible to be borne by | 0012| individual state agencies or covered educational entities, the | 0013| risk management division of the general services department | 0014| may purchase insurance, establish reserves or provide a | 0015| combination of insurance and reserves to: | 0016| (1) cover, in any amount not to exceed | 0017| replacement cost, buildings of state agencies or covered | 0018| educational entities destroyed or damaged by any peril other | 0019| than a peril set forth in Subsection A of this section; | 0020| (2) cover, in any amount not to exceed | 0021| replacement cost, any personal property ~~[which]~~ that is | 0022| destroyed or damaged by any peril; or | 0023| (3) cover, in any amount not to exceed | 0024| replacement cost, any personal property ~~[which]~~ that is | 0025| stolen. | 0001| C. Any insurance purchased pursuant to Subsections A | 0002| and B of this section may be purchased with such deductible | 0003| provisions as may be deemed desirable by the risk management | 0004| advisory board. | 0005| D. The director of the risk management division of | 0006| the general services department shall include in his annual | 0007| report to the legislature an inventory of all public buildings | 0008| insured by the division, the estimated total value of such | 0009| buildings, the total insured value of such buildings and the | 0010| amount of any deductible or maximum loss provisions in the | 0011| current insurance policy covering such buildings. | 0012| E. There is created ~~[in the state treasury]~~ the | 0013| "public property reserve fund". The fund and any income from | 0014| the fund shall be held in trust, deposited in a segregated | 0015| account and invested by the general services department with the | 0016| prior approval of the state board of finance. The fund shall | 0017| consist of assessments of state agencies and covered educational | 0018| entities deposited in the fund, money appropriated to the fund | 0019| and money received as proceeds of insurance purchased pursuant | 0020| to this section. The fund may be used to: | 0021| (1) purchase property insurance; | 0022| (2) pay any claim covered by a certificate of | 0023| coverage issued by the director of the risk management division | 0024| of the general services department; provided such claims shall | 0025| only be paid to the extent of actual expenses ~~[which]~~ that | 0001| have been or will be incurred to repair, reconstruct and replace | 0002| covered property; | 0003| (3) pay the cost of repair, reconstruction and | 0004| replacement of property and expense incidental thereto arising | 0005| from damage or destruction covered pursuant to this section; | 0006| (4) enter into such consulting and other | 0007| contracts as may be necessary or desirable in carrying out the | 0008| provisions of this section; and | 0009| (5) pay any costs and expenses incurred in | 0010| carrying out the provisions of this section. | 0011| F. The director of the legislative council service | 0012| may elect to cover all or any part of any public buildings or | 0013| property under his jurisdiction through the public property | 0014| reserve fund by giving written notice of such election to the | 0015| director of the risk management division of the general | 0016| services department and paying assessments ~~[which]~~ that the | 0017| director of the risk management division prescribes. | 0018| G. For purposes of this section, "state agency" | 0019| means the state or any of its branches, agencies, departments, | 0020| boards, instrumentalities or institutions. | 0021| H. For the purposes of this section, "covered | 0022| educational entities" means school districts as defined in | 0023| Section 22-1-2 NMSA 1978 and educational institutions | 0024| established pursuant to Chapter 21, Articles 13, 16 and 17 NMSA | 0025| 1978 ~~[which]~~ that request and are granted coverage from the | 0001| risk management division of the general services department, if | 0002| the coverage is commercially unavailable; except that coverage | 0003| shall be provided to a school district only through the public | 0004| school ~~[group]~~ insurance authority or its successor unless the | 0005| district has been granted a waiver by the authority or the | 0006| authority is not offering the coverage for the fiscal year for | 0007| which the division offers its coverage. A local school district | 0008| to which the division may provide coverage may provide for | 0009| marketing and servicing to be done by licensed insurance agents | 0010| who shall receive reasonable compensation for their services. | 0011| ~~[I. The provisions of this section are effective~~ | 0012| ~~July 1, 1990.]~~" | 0013| Section 3. Section 15-7-6 NMSA 1978 (being Laws 1977, | 0014| Chapter 385, Section 9, as amended) is amended to read: | 0015| "15-7-6. WORKERS' COMPENSATION RETENTION FUND.-- | 0016| A. There is created ~~[in the state treasury]~~ the | 0017| "workers' compensation retention fund". The fund and any | 0018| interest from the fund shall be held in trust, deposited in a | 0019| segregated account and invested by the general services | 0020| department with the prior approval of the state board of | 0021| finance. | 0022| B. Money deposited in or appropriated to the | 0023| workers' compensation retention fund may be used by the director | 0024| to: | 0025| (1) purchase workers' compensation insurance; | 0001| (2) establish appropriate reserves to provide | 0002| workers' compensation coverage for employees of state agencies | 0003| or employees of covered educational entities; | 0004| (3) pay workers' compensation claims in | 0005| accordance with the Workers' Compensation Act; | 0006| (4) enter into consulting and other contracts | 0007| as may be necessary or desirable in carrying out the provisions | 0008| of this section; and | 0009| (5) pay any costs or expenses incurred in | 0010| carrying out the provisions of this section. | 0011| C. For the purposes of this section, "covered | 0012| educational entities" means school districts as defined in | 0013| Section 22-1-2 NMSA 1978 and educational institutions | 0014| established pursuant to Chapter 21, Articles 13, 16 and 17 NMSA | 0015| 1978 ~~[which]~~ that request and are granted coverage from the | 0016| risk management division of the general services department, if | 0017| the coverage is commercially unavailable; except that coverage | 0018| shall be provided to a school district only through the public | 0019| school ~~[group]~~ insurance authority or its successor unless the | 0020| district has been granted a waiver by the authority or the | 0021| authority is not offering the coverage for the fiscal year for | 0022| which the division offers its coverage. A local school district | 0023| to which the division may provide coverage may provide for | 0024| marketing and servicing to be done by licensed insurance agents, | 0025| who shall receive reasonable compensation for their services." | 0001| Section 4. APPROPRIATION.-- | 0002| A. Thirteen million eight hundred eighty-two | 0003| thousand fifty-four dollars ($13,882,054) is appropriated from | 0004| the general fund to the risk management division of the general | 0005| services department for disbursement in fiscal year 1997 to the | 0006| following funds in the following amounts for expenditure for the | 0007| following purposes: | 0008| (1) four hundred two thousand sixty-four | 0009| dollars ($402,064) to the surety bond fund for expenditure | 0010| pursuant to the provisions of Section 10-2-16 NMSA 1978; | 0011| (2) nine hundred eighty-four thousand eight | 0012| hundred twenty-nine dollars ($984,829) to the public property | 0013| reserve fund for expenditure pursuant to the provisions of | 0014| Section 13-5-1 NMSA 1978; and | 0015| (3) twelve million four hundred ninety-five | 0016| thousand one hundred sixty-one dollars ($12,495,161) to the | 0017| workers' compensation retention fund for expenditure pursuant to | 0018| the provisions of Section 15-7-6 NMSA 1978. | 0019| B. Any unexpended or unencumbered balance remaining | 0020| from the appropriation in Subsection A of this section at the | 0021| end of any fiscal year shall not revert to the general fund. | 0022| | 0023| | 0024| | 0025| | 0001| | 0002| FORTY-SECOND LEGISLATURE | 0003| SECOND SESSION, 1996 | 0004| | 0005| | 0006| JANUARY 31, 1996 | 0007| | 0008| Mr. President: | 0009| | 0010| Your COMMITTEES' COMMITTEE, to whom has been referred | 0011| | 0012| SENATE BILL 59O | 0013| | 0014| has had it under consideration and finds same to be GERMANE, PURSUANT | 0015| TO CONSTITUTIONAL PROVISIONS, and thence referred to the FINANCE | 0016| COMMITTEE. | 0017| | 0018| Respectfully submitted, | 0019| | 0020| | 0021| | 0022| | 0023| __________________________________ | 0024| SENATOR MANNY M. ARAGON, Chairman | 0025| | 0001| | 0002| | 0003| Adopted_______________________ Not Adopted_______________________ | 0004| (Chief Clerk) (Chief Clerk) | 0005| | 0006| | 0007| Date ________________________ | 0008| | 0009| | 0010| | 0011| S0590CC1 |