By Madden H.B. No. 937 74R1343 PB-D A BILL TO BE ENTITLED 1-1 AN ACT 1-2 relating to the establishment and operation of a self-insured 1-3 guaranty account for the protection of policyholders of the Texas 1-4 workers' compensation insurance fund. 1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-6 SECTION 1. Article 5.76-3, Insurance Code, is amended by 1-7 adding Section 22 to read as follows: 1-8 Sec. 22. GUARANTY ACCOUNT. (a) The workers' compensation 1-9 insurance fund guaranty account is created as a special account in 1-10 the state treasury to: 1-11 (1) provide a mechanism for the payment of workers' 1-12 compensation insurance claims under policies issued by the fund in 1-13 the event of the insolvency of the fund; 1-14 (2) avoid financial loss to claimants or policyholders 1-15 because of the insolvency of the fund; and 1-16 (3) ensure a source of capital for solvency, cash 1-17 flow, and capacity problems. 1-18 (b) The guaranty account is composed of: 1-19 (1) the deposit required under Subsection (c) of this 1-20 section; and 1-21 (2) income earned on the amount in the account. 1-22 (c) The fund annually shall deposit in the guaranty account 1-23 an amount equal to the amount of the fund's liability for federal 1-24 income taxes were the fund held to be a taxable entity for federal 2-1 income tax purposes. The state auditor shall compute the amount of 2-2 the annual deposit. 2-3 (d) Money in the account may be disbursed by the fund on 2-4 notification to and the approval of: 2-5 (1) the governor; 2-6 (2) the lieutenant governor; 2-7 (3) the speaker of the Texas House of Representatives; 2-8 and 2-9 (4) the commissioner of insurance. 2-10 (e) In addition to disbursements from the guaranty account 2-11 for the purposes described by Subsection (a) of this section, if 2-12 the Internal Revenue Service determines that the fund is liable for 2-13 the payment of federal income taxes, the fund may use the guaranty 2-14 account to pay any federal income tax liability determined to be 2-15 outstanding. 2-16 SECTION 2. This Act takes effect September 1, 1995. 2-17 SECTION 3. A disbursement from the workers' compensation 2-18 insurance fund guaranty account created under Section 22, Article 2-19 5.76-3, Insurance Code, as added by Section 1 of this Act, for 2-20 payment of a workers' compensation claim for which the Texas 2-21 workers' compensation insurance fund is liable, may be made only 2-22 for a workers' compensation claim that is filed on or after the 2-23 effective date of this Act. A claim filed before that date is 2-24 governed by the law in effect on the date that the claim was filed, 2-25 and the former law is continued in effect for that purpose. 2-26 SECTION 4. The importance of this legislation and the 2-27 crowded condition of the calendars in both houses create an 3-1 emergency and an imperative public necessity that the 3-2 constitutional rule requiring bills to be read on three several 3-3 days in each house be suspended, and this rule is hereby suspended.