BILL ANALYSIS



H.B. 2826
By: Danburg
05-08-95
Committee Report (Unamended)


BACKGROUND

     Commercial rating classifications for motor vehicles are
determined by the use of the vehicle, not the ownership.  A motor
vehicle owned by a nonprofit organization or an entity for profit
would be classified and rated as the same if the vehicle had the
same use.  Small nonprofit agencies face a continual struggle to be
able to provide quality services.  With current economic conditions
making public and private funding even more difficult to obtain,
small nonprofit agencies' resources and energy are focused on
providing services such as shelter, food, clothing and medical care
to those individuals in need.  Prohibitive and exorbitant vehicle
insurance rates take needed dollars away from actual services and,
therefore, limit what small nonprofit agencies are able to do.

PURPOSE

     As proposed, H.B. 2826 gives the Insurance Commissioner the
authority to establish a classification of risk applicable to motor
vehicles used for limited purposes by nonprofit organizations and
requires the Commissioner to adopt rules to classify risks and
define the limited uses permissible for motor vehicles insured
under the classification.

RULEMAKING AUTHORITY

     It is the committee's opinion that this bill grants rulemaking
authority to the Texas Insurance Commissioner under SECTION 1
(Article 5.01(g), Insurance Code).

SECTION BY SECTION ANALYSIS

SECTION 1. 

Amends Article 5.01, Insurance Code, by adding Subsection (g) as
follows:

(g)  Requires the commissioner to establish by rule a
classification of risk applicable to motor   vehicles used for
limited purposes by nonprofit organizations.  Requires the
commissioner   to adopt rules to classify risks and define the
limited uses permissible for motor vehicles  insured under the
classification established under this subsection.  Defines
"nonprofit     organization."

SECTION 2. Effective date: September 1, 1995.
           
SECTION 3. Emergency clause.

SUMMARY OF COMMITTEE ACTION

     In accordance with House rules, H.B. 2826 was heard in a
public hearing on March 29, 1995.  The Chair laid out H.B. 2826 and
a substitute to H.B. 2826.  The Chair recognized Representative
Danburg to explain the difference between the filed bill and
substitute to H.B. 2826.  The Chair recognized the following person
to testify in support of H.B. 2826: Sister Rita Owens, Wellsprings,
Inc.  The Chair recognized the following persons to testify
neutrally on H.B. 2826:  Mary Ellen Burns, United Way of Texas;
David Durden, Texas Department of Insurance.
The Chair left H.B. 2826 pending before the Committee.


     Pursuant to an announcement filed with the Journal Clerk and
read by the Reading Clerk, the House Committee on Insurance met in
a formal meeting on May 8, 1995 at desk #24 on the House Floor and
was called to order by the Chair, Representative John Smithee.

     The Chair laid out H.B. 2826 as pending business and
recognized Representative Shields who moved the Committee report
H.B. 2826 as filed to the full House with the recommendation that
it do pass, be printed and be sent to the Committee on Local and
Consent.  Representative Driver seconded the motion and the motion
prevailed by the following vote: AYES (6); NAYES (0); PNV: (0);
ABSENT (3).