Minnesota Session Laws - 1993, Regular Session

  
    Laws of Minnesota 1993 

                        CHAPTER 228-H.F.No. 199 
           An act relating to insurance; workers' compensation; 
          regulating the state fund mutual insurance company; 
          requiring the workers' compensation reinsurance 
          association to provide funds; amending Minnesota 
          Statutes 1992, sections 176A.02, by adding a 
          subdivision; 176A.11; proposing coding for new law in 
          Minnesota Statutes, chapter 79.  
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
    Section 1.  [79.371] [FUNDS FOR THE STATE FUND MUTUAL 
INSURANCE COMPANY.] 
    Subdivision 1.  [ASSOCIATION OBLIGATION.] The reinsurance 
association shall, no later than July 1, 1993, make funds 
available to the state fund mutual insurance company in the 
amount of $20,000,000 according to terms and conditions approved 
by the commissioner.  The obligation to make these funds 
available supersedes any inconsistent requirements of this 
chapter, the bylaws or plan of operation of the association, or 
duty or obligation imposed upon the board. 
    Subd. 2.  [PERSONAL LIABILITY; EXCLUDED.] The members of 
the board and officers or employees of the association are not 
liable personally, either jointly or severally, for the 
obligation created by this section. 
    Subd. 3.  [STATE AND SPECIAL COMPENSATION FUND OBLIGATION.] 
The obligation of the state fund mutual to the state of 
Minnesota pursuant to section 176A.11 and any obligations to the 
special compensation fund for claims incurred prior to the 
effective date of the obligation created pursuant to section 
79.371 shall be subordinant to that obligation.  In the event of 
the insolvency of the state fund mutual the obligation to the 
workers' compensation reinsurance association created pursuant 
to section 79.371 shall be satisfied in full before any payments 
are made to satisfy the obligations to the state or the special 
compensation fund. 
    Sec. 2.  Minnesota Statutes 1992, section 176A.02, is 
amended by adding a subdivision to read: 
    Subd. 2a.  [WORKERS' COMPENSATION REINSURANCE ASSOCIATION 
DIRECTORS.] Until the obligation owed to the workers' 
compensation reinsurance association pursuant to section 79.371 
has been satisfied, the workers' compensation reinsurance 
association shall be entitled to designate two persons to 
represent the workers' compensation reinsurance association on 
the board of directors. 
    The workers' compensation reinsurance association's 
designees shall be appointed to the first available 
directorships, which the governor is to appoint, which becomes 
available after the creation of the obligation authorized by 
section 79.371. 
    The workers' compensation reinsurance association's 
designees shall resign immediately upon satisfaction of the 
obligation authorized by section 79.371. 
    Sec. 3.  Minnesota Statutes 1992, section 176A.11, is 
amended to read: 
    176A.11 [APPROPRIATION.] 
    Subdivision 1.  [AUTHORIZATION.] There is appropriated from 
the general fund to the state fund mutual insurance company a 
sum of $125,600 to be available until expended.  There is 
appropriated from the general fund to the commissioner of 
finance the amounts of $1,176,900 in fiscal year 1984, and 
$4,424,900 in fiscal year 1985, for the purpose of transfer to 
the state fund mutual insurance company upon certification of 
need in accordance with procedures developed by the 
commissioner.  If the appropriation for either year is 
insufficient, the appropriation for the other year is available 
for it.  Any amount appropriated or transferred plus interest at 
eight percent a year shall be amortized over a ten-year period 
and shall be repaid by the fund to the general fund in equal 
installments at the end of each fiscal year with the first 
payment occurring on June 30, 1986, provided that the fund shall 
not begin repayment on this date unless there exists sufficient 
earned surplus to comply with state law.  Repayment shall then 
begin under the terms of this subdivision when sufficient earned 
surplus exists.  
    Subd. 2.  [MORATORIUM ON PAYMENTS.] No payments of 
principal shall be made in regard to the amounts appropriated 
pursuant to subdivision 1 until all obligations owed to the 
workers' compensation reinsurance association pursuant to 
section 79.371 have been satisfied. 
    Subd. 3.  [INSOLVENCY.] In the case of the insolvency of 
the state fund mutual insurance company, the obligation to the 
general fund for the amounts appropriated pursuant to 
subdivision 1 shall be subordinant to the obligations owed to 
the workers' compensation reinsurance association pursuant to 
section 79.371.  This provision shall not affect the priority of 
the obligation to the general fund as to any other creditor of 
the state fund mutual insurance company or in any other way.  
    Sec. 4.  [REPEALER.] 
     Sections 1, 2, and 3, subdivisions 2 and 3, are repealed 
March 1, 2009. 
    Sec. 5.  [EFFECTIVE DATE.] 
    Sections 1 to 3 are effective the day following final 
enactment and apply to any funds made available to the state 
fund mutual insurance company by the workers' compensation 
reinsurance association between July 1, 1992 and July 1, 1993. 
    Presented to the governor May 14, 1993 
    Signed by the governor May 17, 1993, 10:53 a.m.