FIRST CONFERENCE REPORT

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

Senate Bill No. 770, entitled

A bill to make appropriations for the department of insurance and financial services for the fiscal year ending September 30, 2015; and to provide for the expenditure of the appropriations.

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:

A bill to make appropriations for the department of insurance and financial services for the fiscal year ending September 30, 2015; and to provide for the expenditure of the appropriations.

_______________________ ________________________

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. 770

A bill to make appropriations for the department of insurance

and financial services for the fiscal year ending September 30,

2015; and to provide for the expenditure of the appropriations.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

PART 1

LINE-ITEM APPROPRIATIONS

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 part 2, for the fiscal year ending

September 30, 2015, 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.................................... $ 65,189,700

Interdepartmental grant revenues:

Total interdepartmental grants and intradepartmental

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

ADJUSTED GROSS APPROPRIATION........................... $ 64,482,100

Federal revenues:

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

Special revenue funds:

Total other state restricted revenues.................. 62,427,100

State general fund/general purpose..................... $ 55,000

Sec. 102. DEPARTMENT SERVICES

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

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

Unclassified salaries--6.0 FTE positions............... $ 717,500

Executive director programs--4.0 FTE positions......... 1,011,200

Department services--37.0 FTE positions................ 8,241,900

Property management.................................... 628,100

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

Worker's compensation.................................. 6,200

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

GROSS APPROPRIATION.................................... $ 11,046,200

Appropriated from:

Special revenue funds:

Bank fees.............................................. 1,424,000

Consumer finance fees.................................. 637,200

Credit union fees...................................... 1,168,000

Deferred presentment service transaction fees.......... 502,700

Insurance bureau fund.................................. 3,583,800

Insurance continuing education fees.................... 224,000

Insurance licensing and regulation fees................ 2,754,900

MBLSLA fund............................................ 696,600

State general fund/general purpose..................... $ 55,000

Sec. 103. INSURANCE AND FINANCIAL SERVICES

REGULATION

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

Insurance evaluation--54.0 FTE positions............... $ 13,249,700

Insurance rates and forms--30.0 FTE positions.......... 5,354,600

Financial institutions evaluation--131.0 FTE positions. 18,869,800

Regulatory compliance, market conduct, and licensing--

58.0 FTE positions................................... 10,355,900

Consumer services and protection--23.0 FTE positions... 4,045,800

GROSS APPROPRIATION.................................... $ 51,875,800

Appropriated from:

Interdepartmental grant revenues:

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

Federal revenues:

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

Special revenue funds:

Bank fees.............................................. 6,754,700

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

Consumer finance fees.................................. 4,149,500

Credit union fees...................................... 6,296,300

Deferred presentment service transaction fees.......... 2,553,500

Insurance bureau fund.................................. 19,122,900

Insurance continuing education fees.................... 890,800

Insurance licensing and regulation fees................ 4,892,800

MBLSLA fund............................................ 4,147,600

Multiple employer welfare arrangement.................. 80,700

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

Sec. 104. INFORMATION TECHNOLOGY

Information technology services and projects........... $ 2,267,700

GROSS APPROPRIATION.................................... $ 2,267,700

Appropriated from:

Special revenue funds:

Bank fees.............................................. 255,700

Consumer finance fees.................................. 35,600

Credit union fees...................................... 253,300

Deferred presentment service transaction fees.......... 114,900

Insurance bureau fund.................................. 734,100

Insurance continuing education fees.................... 11,400

Insurance licensing and regulation fees................ 757,900

MBLSLA fund............................................ 104,800

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

PART 2

PROVISIONS CONCERNING APPROPRIATIONS

FOR FISCAL YEAR 2014-2015

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 2014-2015 is $62,482,100.00 and state

spending from state resources to be paid to local units of

government for fiscal year 2014-2015 is $0.00.

Sec. 202. The appropriations authorized under this part and

part 1 are subject to the management and budget act, 1984 PA 431,

MCL 18.1101 to 18.1594.

Sec. 203. As used in this part and part 1:

(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. 205. (1) For each new program or program expansion for

which funds in excess of $500,000.00 are appropriated in part 1,

the department shall identify specific benchmarks intended to

measure the performance or return on taxpayer investment of the

program and its associated expenditures. Not later than November 1,

2014, the department shall report the proposed benchmarks to the

house and senate appropriations subcommittees for that department,

the house and senate fiscal agencies, and the state budget

director. The department shall provide an update on its progress in

achieving those benchmarks at an appropriations subcommittee

meeting called for the purpose of discussing benchmarks and their

status.

(2) It is the intent of the legislature that, beginning with

the budget for the fiscal year ending September 30, 2016, any

proposal for a new program or an expansion of an existing program

in excess of $500,000.00 initiated by the executive branch or the

legislature shall include, as part of the original proposal or

budget request, a list of benchmarks intended to measure the

performance or return on taxpayer investment of the program or

spending increase.

Sec. 208. The departments and agencies receiving

appropriations in this part and part 1 shall use the Internet to

fulfill the reporting requirements of this part. 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 this part and 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 this part and part 1 shall receive and retain copies of all

reports funded from appropriations in this part and 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 chairpersons of the senate and house

appropriations committees and the fiscal agencies.

Sec. 218. The departments and agencies receiving

appropriations in this part and 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 committees, the

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 this part and 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 this part and 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 part 1 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 part 1 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 part 1

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 part 1

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 subcommittees chairs, and the 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, 2014 and

September 30, 2015.

Sec. 235. Total authorized appropriations from all sources

under this part and part 1 for legacy costs for the fiscal year

ending September 30, 2015 is $10,148,200.00. From this amount,

total agency appropriations for pension-related legacy costs are

estimated at $5,627,200.00. Total agency appropriations for retiree

health care legacy costs are estimated at $4,521,000.00.

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

departments and agencies receiving appropriations in this part and

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 this part and 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. The report shall indicate which full-

time equated positions are allocated to economic development and

economic development planning.

Sec. 245. The department, in conjunction with the department

of community health, shall establish an accounting structure within

the Michigan administrative information network that will allow

expenditures associated with the administration of the Healthy

Michigan plan to be identified. By October 1, 2014, the department

shall provide the state budget office and the fiscal agencies with

the relevant accounting structure and associated business objects

script and report that groups administrative costs.

Sec. 246. (1) The amount appropriated from the general fund in

part 1 for executive director program may only be expended to

comply with reporting requirements regarding the Healthy Michigan

plan pursuant to section 105d(9) of the social welfare act, 1939 PA

280, MCL 400.105d.

(2) Prior to expending the amount described in subsection (1),

the department shall acquire at least 2 bids for the project.

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.

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

funds collected by the department 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. 802. (1) Each fiscal year, if expenditures are made from

the autism coverage fund, created by section 7 of the autism

coverage reimbursement act, 2012 PA 101, MCL 550.1837, the

department shall produce a report that contains all of the

following information on the autism coverage reimbursement program,

established by section 5 of the autism coverage reimbursement act,

2012 PA 101, MCL 550.1835, for the fiscal year:

(a) The total number of claims for reimbursement approved and

the number approved within each county, based on the provider's

location.

(b) The total amount expended from the autism coverage fund

for reimbursements and the amount for each carrier receiving

reimbursement.

treatment for which claims for reimbursement are approved.

(2) By October 31 following the end of the fiscal year, the

department shall provide the report required under subsection (1)

to the subcommittees, the fiscal agencies, and the state budget

director.