FIRST CONFERENCE REPORT

The Committee of Conference on the matters of difference between the two Houses concerning

Senate Bill No. 189, entitled

A bill to make appropriations for the department of insurance and financial services and certain other state purposes for the fiscal year ending September 30, 2014; to provide for the expenditure of those appropriations; to provide for the imposition of certain fees; to provide for the disposition of fees and other income received by the state agencies; to provide for reports to certain persons; and to prescribe powers and duties of certain state departments and certain state and local agencies and officers.

Recommends:

First: That the House recede from the Substitute of the House as passed by the House.

Second: That the Senate and House agree to the Substitute of the Senate as passed by the Senate, amended to read as follows:

(attached)

Third: That the Senate and House agree to the title of the bill to read as follows:

of certain fees; to provide for the disposition of fees and other income received by the state agencies; to provide for reports to certain persons; and to prescribe powers and duties of certain state departments and certain state and local agencies and officers.

_______________________ ________________________

Mark C. Jansen Anthony G. Forlini

_______________________ ________________________

Roger Kahn Al Pscholka

_______________________ ________________________

Bert Johnson Pam Faris

Conferees for the Senate Conferees for the House

SUBSTITUTE FOR

SENATE BILL NO. 189

A bill to make appropriations for the department of insurance

and financial services and certain other state purposes for the

fiscal year ending September 30, 2014; to provide for the

expenditure of those appropriations; to provide for the imposition

of certain fees; to provide for the disposition of fees and other

income received by the state agencies; to provide for reports to

certain persons; and to prescribe powers and duties of certain

state departments and certain state and local agencies and

officers.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

PART 1

LINE-ITEM APPROPRIATIONS

FOR FISCAL YEAR 2013-2014

Sec. 101. The amounts listed in this part are appropriated for

the department of insurance and financial services, subject to the

conditions set forth in this act, for the fiscal year ending

September 30, 2014, from the funds identified in this part. The

following is a summary of the appropriations in this part:

DEPARTMENT OF INSURANCE AND FINANCIAL SERVICES

APPROPRIATION SUMMARY

Full-time equated unclassified positions.......... 6.0

Full-time equated classified positions.......... 337.0

GROSS APPROPRIATION.................................... $ 75,335,500

Interdepartmental grant revenues:

Total interdepartmental grants and intradepartmental

transfers............................................ 707,600

ADJUSTED GROSS APPROPRIATION........................... $ 74,627,900

Federal revenues:

Total federal revenues................................. 2,000,000

Special revenue funds:

Total other state restricted revenues.................. 61,627,900

State general fund/general purpose..................... $ 11,000,000

State general fund/general purpose schedule:

Ongoing state general fund/general

purpose................................... 11,000,000

One-time state general fund/general

purpose............................................ 0

Sec. 102. DEPARTMENT SERVICES

Full-time equated unclassified positions.......... 6.0

Full-time equated classified positions........... 41.0

Unclassified salaries--6.0 FTE positions............... $ 700,000

Executive director programs--4.0 FTE positions......... 615,700

Department services--37.0 FTE positions................ 8,168,800

Property management.................................... 792,000

Rent................................................... 258,800

Worker's compensation.................................. 12,700

Administrative hearings................................ 182,500

GROSS APPROPRIATION.................................... $ 10,730,500

Appropriated from:

Special revenue funds:

Bank fees.............................................. 1,330,000

Consumer finance fees.................................. 632,800

Credit union fees...................................... 1,123,700

Deferred presentment service transaction fees.......... 500,600

Insurance bureau fund.................................. 3,409,500

Insurance continuing education fees.................... 221,600

Insurance licensing and regulation fees................ 2,827,000

MBLSLA fund............................................ 685,300

State general fund/general purpose..................... $ 0

Sec. 103. INSURANCE AND FINANCIAL SERVICES

REGULATION

Full-time equated classified positions.......... 296.0

Insurance evaluation--54.0 FTE positions............... $ 13,142,400

Insurance rates and forms--30.0 FTE positions.......... 5,400,000

Financial institutions evaluation--131.0 FTE positions. 18,661,000

Regulatory compliance, market conduct, and licensing--

58.0 FTE positions................................... 10,150,400

Consumer services and protection--23.0 FTE positions... 4,000,000

GROSS APPROPRIATION.................................... $ 51,353,800

Appropriated from:

Interdepartmental grant revenues:

IDG - LARA, for debt management........................ 707,600

Federal revenues:

Federal revenues....................................... 2,000,000

Special revenue funds:

Bank fees.............................................. 6,742,300

Captive insurance regulatory and supervision fund...... 279,400

Consumer finance fees.................................. 4,129,600

Credit union fees...................................... 6,207,500

Deferred presentment service transaction fees.......... 2,525,100

Insurance bureau fund.................................. 18,964,000

Insurance continuing education fees.................... 886,300

Insurance licensing and regulation fees................ 4,725,600

MBLSLA fund............................................ 4,107,000

Multiple employer welfare arrangement.................. 79,400

State general fund/general purpose..................... $ 0

Sec. 104. INFORMATION TECHNOLOGY

Information technology services and projects........... $ 2,251,200

GROSS APPROPRIATION.................................... $ 2,251,200

Appropriated from:

Special revenue funds:

Bank fees.............................................. 253,800

Consumer finance fees.................................. 35,400

Credit union fees...................................... 251,400

Deferred presentment service transaction fees.......... 114,100

Insurance bureau fund.................................. 728,800

Insurance continuing education fees.................... 11,300

Insurance licensing and regulation fees................ 752,300

MBLSLA fund............................................ 104,100

State general fund/general purpose..................... $ 0

Sec. 105. AUTISM COVERAGE

Autism coverage fund................................... $ 11,000,000

GROSS APPROPRIATION.................................... $ 11,000,000

Appropriated from:

State general fund/general purpose..................... $ 11,000,000

PART 2

PROVISIONS CONCERNING APPROPRIATIONS

FOR FISCAL YEAR 2013-2014

GENERAL SECTIONS

Sec. 201. Pursuant to section 30 of article IX of the state

constitution of 1963, total state spending from state resources

under part 1 for fiscal year 2013-2014 is $73,335,500.00 and state

spending from state resources to be paid to local units of

government for fiscal year 2013-2014 is $0.00.

Sec. 202. The appropriations authorized under this act are

subject to the management and budget act, 1984 PA 431, MCL 18.1101

to 18.1594.

Sec. 203. As used in this act:

(a) "Department" means the department of insurance and

financial services.

(b) "Director" means the director of the department.

Michigan senate fiscal agency.

(d) "Subcommittees" means all members of the subcommittees of

the house and senate appropriations committees with jurisdiction

over the budget for the department.

Sec. 208. The departments and agencies receiving

appropriations in part 1 shall use the Internet to fulfill the

reporting requirements of this act. This requirement may include

transmission of reports via electronic mail to the recipients

identified for each reporting requirement, or it may include

placement of reports on an Internet or Intranet site.

Sec. 209. Funds appropriated in part 1 shall not be used for

the purchase of foreign goods or services, or both, if

competitively priced and of comparable quality American goods or

services, or both, are available. Preference shall be given to

goods or services, or both, manufactured or provided by Michigan

businesses, if they are competitively priced and of comparable

quality. In addition, preference shall be given to goods or

services, or both, that are manufactured or provided by Michigan

businesses owned and operated by veterans, if they are

competitively priced and of comparable quality.

Sec. 210. The director shall take all reasonable steps to

ensure businesses in deprived and depressed communities compete for

and perform contracts to provide services or supplies, or both. The

director shall strongly encourage firms with which the department

contracts to subcontract with certified businesses in depressed and

deprived communities for services, supplies, or both.

Sec. 212. The department and agencies receiving appropriations

in part 1 shall receive and retain copies of all reports funded

from appropriations in part 1. Federal and state guidelines for

short-term and long-term retention of records shall be followed.

The department may electronically retain copies or reports unless

otherwise required by federal and state guidelines.

Sec. 215. The department shall not take disciplinary action

against an employee for communicating with a member of the

legislature or his or her staff.

Sec. 216. Not later than November 30, the state budget office

shall prepare and transmit a report that provides for estimates of

the total general fund/general purpose appropriation lapses at the

close of the prior fiscal year. This report shall summarize the

projected year-end general fund/general purpose appropriation

lapses by major departmental program or program areas. The report

shall be transmitted to the state budget office, the chairpersons

of the senate and house appropriations committees, and the senate

and house fiscal agencies.

Sec. 218. The departments and agencies receiving

appropriations in part 1 shall prepare a report on out-of-state

travel expenses not later than January 1 of each year. The travel

report shall be a listing of all travel by classified and

unclassified employees outside this state in the immediately

preceding fiscal year that was funded in whole or in part with

funds appropriated in the department's budget. The report shall be

submitted to the house and senate appropriations committee, the

house and senate fiscal agencies, and the state budget director.

The report shall include the following information:

(a) The dates of each travel occurrence.

(b) The total transportation and related costs of each travel

occurrence, including the proportion funded with state general

fund/general purpose revenues, the proportion funded with state

restricted revenues, the proportion funded with federal revenues,

and the proportion funded with other revenues.

Sec. 219. No later than April 1, the department shall submit

to the subcommittees and the fiscal agencies a report pertaining to

the following information:

(a) The amount, in square footage, of office space paid for

with the appropriation in part 1 for both state-owned and leased

office space, respectively, during the previous fiscal year.

(b) The amount, in square footage, of office space actually

utilized by the department for both state-owned and leased office

space, respectively, during the previous fiscal year.

be utilized during the current and subsequent fiscal years.

Sec. 221. Funds appropriated in part 1 shall not be used by a

principal executive department, state agency, or authority to hire

a person to provide legal services that are the responsibility of

the attorney general. This prohibition does not apply to legal

services for bonding activities and for those outside services that

the attorney general authorizes.

Sec. 223. (1) In addition to the funds appropriated in part 1,

there is appropriated an amount not to exceed $1,000,000.00 for

federal contingency funds. These funds are not available for

expenditure until they have been transferred to another line item

in this act under section 393(2) of the management and budget act,

1984 PA 431, MCL 18.1393.

(2) In addition to the funds appropriated in part 1, there is

appropriated an amount not to exceed $5,000,000.00 for state

restricted contingency funds. These funds are not available for

expenditure until they have been transferred to another line item

in this act under section 393(2) of the management and budget act,

1984 PA 431, MCL 18.1393.

(3) In addition to the funds appropriated in part 1, there is

appropriated an amount not to exceed $200,000.00 for local

contingency funds. These funds are not available for expenditure

until they have been transferred to another line item in this act

under section 393(2) of the management and budget act, 1984 PA 431,

MCL 18.1393.

(4) In addition to the funds appropriated in part 1, there is

appropriated an amount not to exceed $200,000.00 for private

contingency funds. These funds are not available for expenditure

until they have been transferred to another line item in this act

under section 393(2) of the management and budget act, 1984 PA 431,

MCL 18.1393.

Sec. 228. Unless prohibited by law, the department may accept

credit card or other electronic means of payment for licenses,

fees, or permits.

Sec. 229. The department shall maintain, on a publicly

accessible website, a department scorecard that identifies, tracks,

and regularly updates key metrics that are used to monitor and

improve the department's performance.

Sec. 231. The department shall cooperate with the department

of technology, management, and budget to maintain a searchable

website accessible by the public at no cost that includes, but is

not limited to, all of the following for each department or agency:

(a) Fiscal year-to-date expenditures by category.

(b) Fiscal year-to-date expenditures by appropriation unit.

including the vendor name, payment date, payment amount, and

payment description.

(d) The number of active department employees by job

classification.

(e) Job specifications and wage rates.

Sec. 232. The department shall not develop or produce any

television or radio productions.

Sec. 234. Within 14 days after the release of the executive

budget recommendation, the department shall cooperate with the

state budget office to provide the senate and house appropriations

chairs, the senate and house appropriations subcommittees chairs,

and the senate and house fiscal agencies with an annual report on

estimated state restricted fund balances, state restricted fund

projected revenues, and state restricted fund expenditures for the

fiscal years ending September 30, 2013 and September 30, 2014.

Sec. 238. No state department or agency shall issue a request

for proposal (RFP) for a contract in excess of $5,000,000.00,

unless the department or agency has first considered issuing a

request for information (RFI) or a request for qualification (RFQ)

relative to that contract to better enable the department or agency

to learn more about the market for the products or services that

are the subject of the future RFP. The department or agency shall

notify the department of technology, management, and budget of the

evaluation process used to determine if an RFI or RFQ was not

necessary prior to issuing the RFP.

Sec. 240. (1) It is the intent of the legislature that

departments and agencies receiving appropriations in part 1

properly account for their spending and do not use full-time

equated positions as placeholders for spending in other parts of

their budgets.

(2) No later than February 1, the department shall provide a

report to the legislature specifying the number of filled, full-

time equated positions in pay status within each agency receiving

appropriations in part 1 during the immediately preceding fiscal

year. When reporting on the number of filled, full-time equated

positions in pay status, the department shall provide the maximum

number of filled, full-time equated positions in pay status by

appropriation line item in the last pay period of each quarter of

the immediately preceding fiscal year. The report shall also

include a list of all funded, full-time equated positions by

position title.

INSURANCE AND FINANCIAL SERVICES REGULATION

Sec. 310. (1) No later than February 1, the department shall

submit a report to the subcommittees and the fiscal agencies

providing the following information:

(a) The amounts expended, by fund source, by the department to

support the economic development of the insurance or financial

industries during the preceding fiscal year.

(b) The number of full-time equated positions utilized by the

department to support the economic development of the insurance or

financial industries during the preceding fiscal year.

activities to support the economic development of the insurance or

financial industries.

(2) For purposes of subsection (1), "economic development"

includes any activities to encourage, promote, or advocate for the

expansion, retention, or attraction of business or nonprofit

entities engaged in or involved with the insurance or financial

industries.

Sec. 341. The department shall not promulgate or adopt a rule

more stringent than the applicable federal standard unless

specifically authorized by statute.

Sec. 391. In addition to the funds appropriated in part 1, the

funds collected by the office of financial and insurance regulation

in connection with a conservatorship pursuant to section 32 of the

mortgage brokers, lenders, and servicers licensing act, 1987 PA

173, MCL 445.1682, and funds collected by the department from

corporations being liquidated pursuant to the insurance code of

1956, 1956 PA 218, MCL 500.100 to 500.8302, shall be appropriated

for all expenses necessary to provide for the required services.

Funds are available for expenditure when they are received by the

department of treasury and shall not lapse to the general fund at

the end of the fiscal year.

AUTISM COVERAGE

Sec. 801. Of the amount appropriated in part 1 for the autism

coverage fund, $11,000,000.00 is appropriated and may be expended

by the department as provided in the autism coverage reimbursement

act, 2012 PA 101, MCL 550.1831 to 550.1841.

Sec. 802. (1) From the funds appropriated in part 1, the

department shall produce a report that contains all of the

following information on the autism coverage program for the fiscal

year ending September 30, 2014:

(a) The number of reimbursements for diagnosis or treatment in

each county.

(b) The average cost of a diagnosis reimbursement.

(2) By September 30, 2014, the department shall provide the

report required under subsection (1) to the house and senate

appropriations committees, the fiscal agencies, and the state

budget director using all available information at that time.

PART 2A

PROVISIONS CONCERNING ANTICIPATED APPROPRIATIONS

FOR FISCAL YEAR 2014-2015

GENERAL SECTIONS

Sec. 1201. It is the intent of the legislature to provide

appropriations for the fiscal year ending on September 30, 2015 for

the line items listed in part 1. The fiscal year 2014-2015

appropriations are anticipated to be the same as those for fiscal

year 2013-2014, except that the line items will be adjusted for

changes in caseload and related costs, federal fund match rates,

economic factors, and available revenue. These adjustments will be

determined after the January 2014 consensus revenue estimating

conference.

Sec. 1202. It is the intent of the legislature that the

department identify the amounts for normal retirement costs and

legacy retirement costs for the fiscal year ending on September 30,

2015 for the line items listed in part 1.