LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE 74th Regular Session March 1, 1995 TO: Honorable Kim Brimer IN RE: Committee Substitute Committee on Business & Industry for House of Representatives House Bill Austin, Texas No. 1090 By: Brimer, Counts, Junell FROM: John Keel, Director In response to your request for a Fiscal Note on House Bill No. 1090 (relating to the continuation and functions of the Texas Workers' Compensation Insurance Fund) this office has determined the following: The Texas Workers' Compensation Insurance Fund is subject to the provisions of the Texas Sunset Act, and unless continued in existence by the legislature, will be abolished effective September 1, 1995. The bill would continue the Texas Workers' Compensation Insurance Fund and make several changes to the enabling statute. Some of the more significant changes include providing additional legislative oversight of the Fund, authorizing the Fund to combine commonly-owned or commonly-controlled businesses for the purposes of insurance and requiring the Fund to file its annual report with the Texas Department of Insurance (TDI) no later than March 1st of each year. The Texas Workers' Compensation Insurance Fund is not a state agency nor a unit of local government and receives no appropriation of state funds. Consequently, no fiscal implication to the state resulting from the implementation of provisions of the bill is anticipated. The bill contains two provisions which would result in a savings to the Texas Workers' Compensation Insurance Fund. One provision would change the statute to authorize the Texas Workers' Compensation Insurance Fund to require a business owner seeking workers' compensation insurance from the Texas Workers' Compensation Insurance Fund through the insurer of last resort program to insure all commonly-owned or commonly-controlled businesses. This provision could result in a savings through a reduction in premium loss and inappropriate claims payments. The estimated savings of this provision cannot be determined as the amount of savings generated through a reduction in premium loss and claims payments cannot be estimated. The second provision, which would require the Texas Workers' Compensation Insurance Fund to complete its annual report and file the report with the Texas Department of Insurance no later than March 1 of each fiscal year, would result in a savings to the Texas Workers' Compensation Insurance Fund of approximately $109,000 per year. This savings would occur as a result of eliminating the payment of overtime wages in order to meet previous reporting requirements. No fiscal implication to units of local government is anticipated. Source: Sunset Advisory Commission, State Auditor's Office, Workers' Compensation Commission LBB Staff: JK, KVO, RR