2004 Minnesota Statutes

     79.38 Plan of operation. 

    Subdivision 1.    Provisions.  The plan of operation 
 shall provide for all of the following: 

    (a) the establishment of necessary facilities; 

    (b) the management and operation of the reinsurance 
 association; 

    (c) a preliminary premium, payable by each member in 
 proportion to its total premium in the year preceding the 
 inauguration of the reinsurance association, for initial 
 expenses necessary to commence operation of the reinsurance 
 association; 

    (d) procedures to be utilized in charging premiums, 
 including adjustments from excess or deficient premiums from 
 prior periods; 

    (e) procedures governing the actual payment of premiums to 
 the reinsurance association; 

    (f) reimbursement of each member of the board by the 
 reinsurance association for actual and necessary expenses 
 incurred on reinsurance association business; 

    (g) the composition, terms, compensation and other 
 necessary rules consistent with section 79.37 for boards of 
 directors of the reinsurance association; 

    (h) the investment policy of the reinsurance association; 
 and 

    (i) any other matters required by or necessary to 
 effectively implement sections 79.34 to 79.40. 

    Subd. 2.    Validity.  If the reinsurance association is 
 incorporated pursuant to chapter 317A, the plan of operation 
 shall be filed with and accepted by the secretary of state as 
 the corporation's articles of incorporation and bylaws.  The 
 plan of operation shall be valid as articles of incorporation 
 and bylaws under chapter 317A, notwithstanding that one or more 
 of the required provisions for articles and bylaws under chapter 
 317A is not included or requirements of form are not followed.  

    Subd. 3.    Amendments.  (a)   Procedure with members' 
 ratification.  The plan of operation may be amended, in whole 
 or in part, as follows:  proposal of an amendment by a member of 
 the board and adoption by a majority vote of the board at a 
 meeting duly called for that purpose, ratification by a majority 
 vote of the members at any annual meeting or special meeting 
 duly called for that purpose, and approval of the commissioner 
 of labor and industry, provided that an amendment shall be 
 deemed approved 30 days after the day following the date of 
 ratification by the members if not sooner disapproved by written 
 order of the commissioner.  

    (b)   Emergency board power to amend with delayed 
 members' ratification.  The board shall have emergency powers 
 to amend the plan at a meeting duly called for that purpose, 
 without ratification by the members; provided that a meeting of 
 members shall be scheduled to consider ratification of the 
 amendment within 90 days.  

    (c)   Commissioner's power to amend.  If the board 
 proposes an amendment which the members decline to ratify, the 
 commissioner of labor and industry is authorized, upon request 
 of the board, to amend the plan as proposed by the board when 
 the commissioner determines that failure to adopt the proposed 
 amendment may seriously impair the ability of the reinsurance 
 association to meet its financial obligations.  

    (d)   Delegation of authority to ratify.  By a majority 
 vote, the members, voting in person, or by proxy if authorized 
 by the board, at a meeting duly called for that purpose, may 
 authorize the board to exercise the power of amendment of the 
 plan without ratification by the members.  When the members have 
 authorized the board to amend the plan without ratification by 
 the members, the board may, by a majority vote of the directors, 
 amend the plan, provided that notice of the meeting and of the 
 proposed amendment shall be given to each director and officer, 
 including the commissioner of labor and industry.  By a majority 
 vote, the members, voting in person, or by proxy if authorized 
 by the board, at a meeting duly called for that purpose, may 
 prospectively revoke the authority of the board to amend the 
 plan without ratification by the members.  

    HIST: Ex1979 c 3 s 21; 1980 c 556 s 11; 1981 c 346 s 139; 1985 
 c 234 s 21; 1986 c 444; 1987 c 384 art 2 s 1,16; 1989 c 304 s 
 137