FISCAL NOTE



FUND(S):

7152

Sources of Revenue:

Special Fund

Legislation creates:

A New Program



Fiscal Note Summary


Effect this measure will have on costs and revenues of state government.


Senate Bill 575 is estimated to result in a net cost, increased revenues less increased expenditures, of ($14,750) the first year and a net cost of ($22,500) for subsequent years. Initial license application fees are higher than subsequent renewal fees offsetting a larger percentage of state expenditures during the first year. The proposal provides for civil money penalties for noncompliance, no noncompliance estimates were included in the figures of this fiscal note.



Fiscal Note Detail


Effect of Proposal Fiscal Year
2008
Increase/Decrease
(use"-")
2009
Increase/Decrease
(use"-")
Fiscal Year
(Upon Full
Implementation)
1. Estmated Total Cost 35,000 33,750 33,750
Personal Services 33,750 33,750 33,750
Current Expenses 1,250 0 0
Repairs and Alterations 0 0 0
Assets 0 0 0
Other 0 0 0
2. Estimated Total Revenues 20,250 11,250 11,250


Explanation of above estimates (including long-range effect):


It is projected that 30 Discounts Plans will apply for licensure. Initial Application and Filing fees will average $675 per Plan. $675 X 30 = $20,250 Renewal Filing fees will average $375 per Plan, includes an annual rate filing. $375 X 30 = $11,250 In order to regulate the plans, the following individuals within the Offices of the Insurance Commissioner will be directly involved. Rates & Forms Analyst, $30,000 Salary + Benefits = $40,500 Financial Conditions Auditor, $30,000 Salary + Benefits = $40,500 Market Conduct Examiner, $40,000 Salary + Benefits = $54,000 It is estimated that the additional regulation will require 25% of each individual’s time. ($40,500 + $40,500 + $54,000) X 0.25 = $33,750 in annual personal services expenditures. $1,250 in current expenses has been included for the first year’s development of forms, etc. Initial Cost = Revenue – Expenditures $20,250 - $35,000 = ($14,750) Subsequent Years = Revenue – Expenditures $11,250 - $33,750 = ($22,500)



Memorandum






    Person submitting Fiscal Note: Michael D. Riley
    Email Address: Michael.Riley@wvinsurance.gov