1Creating the Insurance Regulation and Oversight Fund; and
2providing for its use.

3The General Assembly of the Commonwealth of Pennsylvania
4hereby enacts as follows:

5Section 1. Short title.

6This act shall be known and may be cited as the Insurance
7Regulation and Oversight Fund Act.

8Section 2. Definitions.

9The following words and phrases when used in this act shall
10have the meanings given to them in this section unless the
11context clearly indicates otherwise:

12"Commissioner." The Insurance Commissioner of the
13Commonwealth or his duly authorized representative.

14"Department." The Insurance Department of the Commonwealth.

15"Fund." The Insurance Regulation and Oversight Fund created
16under this act.

17Section 3. Purpose and use of fund.

18(a) Creation and purpose of fund.--To provide for the

1department's regulation, management, development and oversight
2of the Commonwealth's insurance industry, beginning July 1,
32013, and every fiscal year thereafter, the department's
4operating costs and expenses shall be paid from a special fund
5called the Insurance Regulation and Oversight Fund, which is
6hereby created in the State Treasury.

7(b) Limitations on use.--Moneys in the fund shall not be
8used to pay the department's operating costs or expenditures
9when those costs and expenditures arise from actions, duties or
10functions that are payable from other dedicated sources of
11funding including, but not limited to, the following:

12(1) The rehabilitation and liquidation of insurance
13companies pursuant to Article V of the act of May 17, 1921
14(P.L.789, No.285), known as The Insurance Department Act of
151921.

16(2) The Catastrophic Loss Benefits Continuation Fund
17under 75 Pa.C.S. § 1798.4 (relating to Catastrophic Loss
18Benefits Continuation Fund).

19(3) The Underground Storage Tank Indemnification Fund
20under the act of July 6, 1989 (P.L.169, No.32), known as the
21Storage Tank and Spill Prevention Act.

22(4) The Workers Compensation Security Fund pursuant to
23the act of July 1, 1937 (P.L.2532, No.470), known as the
24Workers' Compensation Security Fund Act.

25(5) The Medical Care Availability and Reduction of Error
26Fund under the act of March 20, 2002 (P.L.154, No.13), known
27as the Medical Care Availability and Reduction of Error
28(Mcare) Act.

29(6) The Children's Health Insurance Program under the
30act of May 17, 1921 (P.L.682, No.284), known as The Insurance

1Company Law of 1921.

2Section 4. Deposit of moneys to the fund and appropriation and
3expenditure of the fund.

4(a) Deposits.--The following amounts shall be deposited into
5the fund:

6(1) fifty percent of all licenses and fees collected,
7received or derived by the department each month;

8(2) all funds and moneys collected, received or derived
9from all penalties, fines or settlements received by the
10department; and

11(3) all augmentations and reimbursements made to the
12department by regulated entities as a result of financial and
13market regulation activities for which regulated entities are
14responsible for payment.

15(b) Exclusion from deposit.--Moneys collected pursuant to 75
16Pa.C.S. § 6506 (relating to surcharge) and deposited into the
17General Fund pursuant to section 1798-E of the act of April 9,
181929 (P.L.343, No.176), known as The Fiscal Code, shall not be
19deposited into the fund.

20(c) Annual appropriation.--The General Assembly shall
21annually appropriate moneys from the fund to the department, and
22the department may expend the appropriated moneys only for the
23purposes authorized under this act. The department shall
24annually submit a proposal for its expenditure of fund moneys
25for the succeeding fiscal year to the Secretary of the Budget at
26the time or times required by, and in accordance with the act of
27April 9, 1929 (P.L.177, No.175), known as The Administrative
28Code of 1929.

29(d) Fiscal year 2013-2014.--If during the Commonwealth's
30fiscal year 2013-2014 the commissioner and the Secretary of the

1Budget determine that the cash balance and the current estimated
2receipts of the fund are insufficient at any time during that
3fiscal year to promptly meet the department's expenses payable
4from the fund, then the State Treasurer is hereby authorized and
5directed to transfer from the General Fund, Workers'
6Compensation Security Fund or Underground Storage Tank
7Indemnification Fund to the fund such moneys as the Governor
8shall from time to time direct. Moneys transferred from the
9General Fund, Workers' Compensation Security Fund or Underground
10Storage Tank Indemnification Fund to the fund shall be available
11during fiscal year 2013-2014 to be used for the purposes of the
12fund under this act upon their receipt in the fund. The fund
13shall reimburse the General Fund, Workers' Compensation Security
14Fund or Underground Storage Tank Indemnification Fund for any
15moneys transferred to the fund pursuant to this subsection by
16transferring to the General Fund, Workers' Compensation Security
17Fund or Underground Storage Tank Indemnification Fund an amount
18equal to that transferred from the General Fund, Workers'
19Compensation Security Fund or Underground Storage Tank
20Indemnification Fund during fiscal year 2013-2014 at such times
21as the Governor shall direct, but full reimbursement shall be
22made from the fund to the General Fund or Workers' Compensation
23Security Fund or Underground Storage Tank Indemnification Fund
24before June 15, 2014. The Secretary of the Budget shall notify
25the chairman and minority chairman of the Appropriations
26Committee of the Senate and the chairman and minority chairman
27of the Appropriations Committee of the House of Representatives
28of any transfers and reimbursements made pursuant to this
29subsection in writing within 15 days of the date on which they
30are made.

1Section 5. Retention.

2At the end of the fiscal year, the fund shall retain an
3amount equal to not more than 100% of the total expenditures and
4commitments by the department from the fund in the immediately
5preceding fiscal year. If the balance in the fund at the end of
6the fiscal year exceeds this retention amount, then that amount
7of the fund which exceeds the retention amount shall be lapsed
8and deposited in the General Fund within 30 days of the end of
9the fiscal year.

10Section 6. Effective date.

11This act shall take effect immediately.