Senate Bill sb2556
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Florida Senate - 2003 SB 2556
By Senator Posey
24-1370A-03
1 A bill to be entitled
2 An act relating to the Florida Hurricane
3 Catastrophe Fund; amending s. 215.555, F.S.;
4 revising the definition of "covered policy";
5 conforming provisions to the creation of the
6 Citizens Property Insurance Corporation;
7 providing definitions; authorizing the State
8 Board of Administration to adopt rules to
9 specify interest on past due remittances;
10 increasing the aggregate exposure of insurers
11 who may be exempt by rule; revising the maximum
12 amount for which the board is obligated to
13 reimburse insurers for a contract year;
14 authorizing the Office of Insurance Regulation,
15 rather than the Department of Insurance, to
16 take certain actions relative to the fund;
17 providing that emergency assessments are to be
18 levied against insureds procuring certain types
19 of insurance from surplus lines insurers;
20 increasing the maximum assessment that may be
21 levied against assessable insurers and
22 assessable insured; requiring that emergency
23 assessments on assessable insureds be remitted
24 to the Florida Surplus Lines Service Office;
25 specifying that emergency assessments are not
26 premiums subject to taxes, fees, or
27 commissions; providing that reinsurance
28 procured by the board must be from reinsurers
29 acceptable to the Office of Insurance
30 Regulation; clarifying the fiscal year used to
31 determine investment income for purposes of
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1 calculating the maximum amount that may be
2 appropriated by the Legislature for mitigation
3 purposes; providing an effective date.
4
5 Be It Enacted by the Legislature of the State of Florida:
6
7 Section 1. Paragraph (c) of subsection (2) of section
8 215.555, Florida Statutes, is amended, paragraphs (n) and (o)
9 are added to that subsection, subsection (3), paragraphs (c)
10 and (d) of subsection (4), subsection (6), and paragraphs (a)
11 and (c) of subsection (7) of that section are amended, to
12 read:
13 215.555 Florida Hurricane Catastrophe Fund.--
14 (2) DEFINITIONS.--As used in this section:
15 (c) "Covered policy" means any insurance policy
16 covering residential property in this state, including, but
17 not limited to, any homeowner's, mobile home owner's, farm
18 owner's, condominium association, condominium unit owner's,
19 tenant's, or apartment building policy, or any other policy
20 covering a residential structure or its contents issued by any
21 authorized insurer, including the Citizens Property Insurance
22 Corporation and any joint underwriting association or similar
23 entity created pursuant to law. The term "covered policy"
24 includes any collateral protection insurance policy covering
25 personal residences which protects both the borrower's and the
26 lender's financial interests, in an amount at least equal to
27 the coverage for the dwelling in place under the lapsed
28 homeowner's policy, if such policy can be accurately reported
29 as required in subsection (5). Additionally, covered policies
30 include policies covering the peril of wind removed from the
31 Citizens Property Insurance Corporation the Florida
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1 Residential Property and Casualty Joint Underwriting
2 Association, created pursuant to s. 627.351(6), or from the
3 Florida Windstorm Underwriting Association, created pursuant
4 to s. 627.351(2), by an authorized insurer under the terms and
5 conditions of an executed assumption agreement between the
6 authorized insurer and the Citizens Property Insurance
7 Corporation either such association. Each assumption agreement
8 between the Citizens Property Insurance Corporation either
9 association and such authorized insurer must be approved by
10 the Office of Insurance Regulation of the Financial Services
11 Commission Florida Department of Insurance prior to the
12 effective date of the assumption, and such office the
13 Department of Insurance must provide written notification to
14 the board within 15 working days after such approval. "Covered
15 policy" does not include any policy that excludes wind
16 coverage or hurricane coverage or any reinsurance agreement
17 and does not include any policy otherwise meeting this
18 definition which is issued by a surplus lines insurer or a
19 reinsurer. Policies that, based on sound actuarial principles,
20 require individual ratemaking may be excluded by type or
21 category as covered policies by rule if the actuarial
22 soundness of the fund is not jeopardized.
23 (n) "Citizens Property Insurance Corporation" means
24 the entity created pursuant to s. 627.351(6) and includes both
25 the high-risk account, formerly the Florida Windstorm
26 Underwriting Association, and the personal lines and
27 commercial lines account, formerly the Residential Property
28 and Casualty Joint Underwriting Association.
29 (o) "Corporation" means the Florida Hurricane
30 Catastrophe Fund Finance Corporation created in paragraph
31 (6)(d).
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1 (3) FLORIDA HURRICANE CATASTROPHE FUND CREATED.--There
2 is created the Florida Hurricane Catastrophe Fund to be
3 administered by the State Board of Administration. Moneys in
4 the fund may not be expended, loaned, or appropriated except
5 to pay obligations of the fund arising out of reimbursement
6 contracts entered into under subsection (4), payment of debt
7 service on revenue bonds issued under subsection (6), costs of
8 the mitigation program under subsection (7), costs of
9 procuring reinsurance, and costs of administration of the
10 fund. The board shall invest the moneys in the fund pursuant
11 to ss. 215.44-215.52. Except as otherwise provided in this
12 section, earnings from all investments shall be retained in
13 the fund. The board may employ or contract with such staff and
14 professionals as the board deems necessary for the
15 administration of the fund. The board may adopt such rules as
16 are reasonable and necessary to implement this section and may
17 specify interest due on any delinquent remittances. Such rules
18 must conform to the Legislature's specific intent in
19 establishing the fund as expressed in subsection (1), must
20 enhance the fund's potential ability to respond to claims for
21 covered events, must contain general provisions so that the
22 rules can be applied with reasonable flexibility so as to
23 accommodate insurers in situations of an unusual nature or
24 where undue hardship may result, except that such flexibility
25 may not in any way impair, override, supersede, or constrain
26 the public purpose of the fund, and must be consistent with
27 sound insurance practices. The board may, by rule, provide for
28 the exemption from subsections (4) and (5) of insurers writing
29 covered policies with less than $3 million $500,000 in
30 aggregate exposure for covered policies, which exposure
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1 results in a de minimis reimbursement premium, if the
2 exemption does not affect the actuarial soundness of the fund.
3 (4) REIMBURSEMENT CONTRACTS.--
4 (c)1. The contract shall also provide that the
5 obligation of the board with respect to all contracts covering
6 a particular contract year shall not exceed the actual
7 claims-paying capacity of the fund up to a limit of $11
8 billion for that contract year, adjusted based on the reported
9 exposure from the prior contract year to reflect the
10 percentage growth in exposure of the fund for covered policies
11 since 2002 unless the board determines that there is
12 sufficient estimated claims-paying capacity to provide $11
13 billion of capacity for the current contract year and an
14 additional $11 billion of capacity for subsequent contract
15 years. Upon such determination being made, the estimated
16 claims-paying capacity for the current contract year shall be
17 determined by adding to the $11 billion limit one-half of the
18 fund's estimated claims-paying capacity in excess of $22
19 billion.
20 2. The contract shall require the board to annually
21 notify insurers of the fund's estimated borrowing capacity for
22 the next contract year, the projected year-end balance of the
23 fund, and the insurer's estimated share of total reimbursement
24 premium to be paid to the fund. For all regulatory and
25 reinsurance purposes, an insurer may calculate its projected
26 payout from the fund as its share of the total fund premium
27 for the current contract year multiplied by the sum of the
28 projected year-end fund balance and the estimated borrowing
29 capacity for that contract year as reported under this
30 paragraph. In May and October of each year, the board shall
31 publish in the Florida Administrative Weekly a statement of
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1 the fund's estimated borrowing capacity and the projected
2 year-end balance of the fund for the current contract year.
3 (d)1. For purposes of determining potential liability
4 and to aid in the sound administration of the fund, the
5 contract shall require each insurer to report such insurer's
6 losses from each covered event on an interim basis, as
7 directed by the board. The contract shall require the insurer
8 to report to the board no later than December 31 of each year,
9 and quarterly thereafter, its reimbursable losses from covered
10 events for the year. The contract shall require the board to
11 determine and pay, as soon as practicable after receiving
12 these reports of reimbursable losses, the initial amount of
13 reimbursement due and adjustments to this amount based on
14 later loss information. The adjustments to reimbursement
15 amounts shall require the board to pay, or the insurer to
16 return, amounts reflecting the most recent calculation of
17 losses.
18 2. In determining reimbursements pursuant to this
19 subsection, the contract shall provide that the board shall:
20 a. First reimburse insurers writing covered policies,
21 which insurers are in full compliance with this section and
22 have petitioned the Office of Insurance Regulation Department
23 of Insurance and qualified as limited apportionment companies
24 under s. 627.351(2)(b)3. The amount of such reimbursement
25 shall be the lesser of $10 million or an amount equal to 10
26 times the insurer's reimbursement premium for the current
27 year. The amount of reimbursement paid under this
28 sub-subparagraph may not exceed the full amount of
29 reimbursement promised in the reimbursement contract. This
30 sub-subparagraph does not apply with respect to any contract
31 year in which the year-end projected cash balance of the fund,
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1 exclusive of any bonding capacity of the fund, exceeds $2
2 billion. Only one member of any insurer group may receive
3 reimbursement under this sub-subparagraph.
4 b. Next pay to each insurer such insurer's projected
5 payout, which is the amount of reimbursement it is owed, up to
6 an amount equal to the insurer's share of the actual premium
7 paid for that contract year, multiplied by the actual
8 claims-paying capacity available for that contract year;
9 provided, entities created pursuant to s. 627.351 shall be
10 further reimbursed in accordance with sub-subparagraph c.
11 c. Thereafter, establish, based on reimbursable
12 losses, the prorated reimbursement level at the highest level
13 for which any remaining fund balance or bond proceeds are
14 sufficient to reimburse entities created pursuant to s.
15 627.351 for losses exceeding the amounts payable pursuant to
16 sub-subparagraph b. for the current contract year.
17 (6) REVENUE BONDS.--
18 (a) General provisions.--
19 1. Upon the occurrence of a hurricane and a
20 determination that the moneys in the fund are or will be
21 insufficient to pay reimbursement at the levels promised in
22 the reimbursement contracts, the board may take the necessary
23 steps under paragraph (b) or paragraph (c) or paragraph (d)
24 for the issuance of revenue bonds for the benefit of the fund.
25 The proceeds of such revenue bonds may be used to make
26 reimbursement payments under reimbursement contracts; to
27 refinance or replace previously existing borrowings or
28 financial arrangements; to pay interest on bonds; to fund
29 reserves for the bonds; to pay expenses incident to the
30 issuance or sale of any bond issued under this section,
31 including costs of validating, printing, and delivering the
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1 bonds, costs of printing the official statement, costs of
2 publishing notices of sale of the bonds, and related
3 administrative expenses; or for such other purposes related to
4 the financial obligations of the fund as the board may
5 determine. The term of the bonds may not exceed 30 years. The
6 board may pledge or authorize the corporation to pledge all or
7 a portion of all revenues under subsection (5) and under
8 paragraph (b) subparagraph 3. to secure such revenue bonds and
9 the board may execute such agreements between the board and
10 the issuer of any revenue bonds and providers of other
11 financing arrangements under paragraph (7)(b) as the board
12 deems necessary to evidence, secure, preserve, and protect
13 such pledge. If reimbursement premiums received under
14 subsection (5) or earnings on such premiums are used to pay
15 debt service on revenue bonds, such premiums and earnings
16 shall be used only after the use of the moneys derived from
17 assessments under paragraph (b) subparagraph 3. The funds,
18 credit, property, or taxing power of the state or political
19 subdivisions of the state shall not be pledged for the payment
20 of such bonds. The board may also enter into agreements under
21 paragraph (b) or paragraph (c) or paragraph (d) for the
22 purpose of issuing revenue bonds in the absence of a hurricane
23 upon a determination that such action would maximize the
24 ability of the fund to meet future obligations.
25 2. The Legislature finds and declares that the
26 issuance of bonds under this subsection is for the public
27 purpose of paying the proceeds of the bonds to insurers,
28 thereby enabling insurers to pay the claims of policyholders
29 to assure that policyholders are able to pay the cost of
30 construction, reconstruction, repair, restoration, and other
31 costs associated with damage to property of policyholders of
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1 covered policies after the occurrence of a hurricane. Revenue
2 bonds may not be issued under this subsection until validated
3 under chapter 75. The validation of at least the first
4 obligations incurred pursuant to this subsection shall be
5 appealed to the Supreme Court, to be handled on an expedited
6 basis.
7 (b)3. Emergency Assessments.--If the board determines
8 that the amount of revenue produced under subsection (5) is
9 insufficient to fund the obligations, costs, and expenses of
10 the fund and the corporation, including repayment of revenue
11 bonds, the board shall direct the Office of Insurance
12 Regulation Department of Insurance to levy an emergency
13 assessment on each insurer writing property and casualty
14 business in this state, referred to in this section as an
15 "assessable insurer" and on those insureds procuring one or
16 more lines of property and casualty business in this state
17 pursuant to part VII of chapter 626, referred to in this
18 section as an "assessable insured."
19 1. Pursuant to the emergency assessment, each such
20 assessable insurer shall pay to the corporation by July 1 of
21 each year an amount set by the board not exceeding 3 2 percent
22 of its gross direct written premium for the prior year from
23 all property and casualty business in this state except for
24 workers' compensation, except that, if the Governor has
25 declared a state of emergency under s. 252.36 due to the
26 occurrence of a covered event, the amount of the assessment
27 for the contract year may be increased to an amount not
28 exceeding 5 4 percent of such premium.
29 2.a. Pursuant to the emergency assessment, each
30 assessable insured shall pay an amount set by the board not
31 exceeding 3 percent of the gross written premium each year for
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1 all property and casualty business procured in this state,
2 except for workers' compensation. However, if the Governor has
3 declared a state of emergency under s. 252.36 due to the
4 occurrence of a covered event, the amount of the assessment
5 for the contract year may be increased to an amount not
6 exceeding 5 percent of such premium.
7 b. The emergency assessment on each assessable insured
8 shall be collected by the surplus lines agent at the time the
9 agent collects the surplus lines tax required by s. 626.932
10 and shall be remitted to the Florida Surplus Lines Service
11 Office, created pursuant to s. 626.921, at the time the
12 surplus lines agent pays the surplus lines tax to the Florida
13 Surplus Lines Service Office. The emergency assessment on each
14 assessable insured procuring coverage and filing under s.
15 626.938 shall be remitted to the Florida Surplus Lines Service
16 Office, at the time the insured pays the surplus lines tax to
17 the Florida Surplus Lines Service Office. The emergency
18 assessments shall be transferred to the corporation or to the
19 fund pursuant to subparagraph 5. on a periodic basis as
20 determined by the board. The Florida Surplus Lines Service
21 Office shall verify the proper application by surplus lines
22 agents of the emergency assessments and shall assist the board
23 in ensuring the accurate, timely collection and payment of
24 assessments by surplus lines agents as required by the board.
25 The Florida Surplus Lines Service Office shall determine
26 annually the aggregate written premium on property and
27 casualty business, except workers compensation, procured by
28 assessable insureds and shall report that information to the
29 board in a form and at a time specified by it to ensure that
30 the fund and the corporation can meet their financing
31 obligations.
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1 3. Any assessment authority not used for the contract
2 year may be used for a subsequent contract year. If, for a
3 subsequent contract year, the board determines that the amount
4 of revenue produced under subsection (5) is insufficient to
5 fund the obligations, costs, and expenses of the fund and the
6 corporation, including repayment of revenue bonds for that
7 contract year, the board shall direct the Office of Insurance
8 Regulation Department of Insurance to levy an emergency
9 assessment up to an amount not exceeding the amount of unused
10 assessment authority from a previous contract year or years,
11 plus an additional 3 2 percent if the Governor has declared a
12 state of emergency under s. 252.36 due to the occurrence of a
13 covered event. Any assessment authority not used for the
14 contract year may be used for a subsequent contract year. As
15 used in this subsection, the term "property and casualty
16 business" includes all lines of business identified on Form 2,
17 Exhibit of Premiums and Losses, in the annual statement
18 required of authorized insurers by s. 624.424 and any rules
19 adopted under such section, except for those lines identified
20 as accident and health insurance. The annual assessments under
21 this subparagraph shall continue as long as the revenue bonds
22 issued with respect to which the assessment was imposed are
23 outstanding, unless adequate provision has been made for the
24 payment of such bonds pursuant to the documents authorizing
25 issuance of the bonds. An assessable insurer or assessable
26 insured shall not at any time be subject to aggregate annual
27 assessments under this subparagraph of more than 3 2 percent
28 of premium, except that in the case of a declared emergency,
29 an assessable insurer or assessable insured shall not at any
30 time be subject to aggregate annual assessments under this
31 subparagraph of more than 8 6 percent of premium; provided, no
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1 more than 5 4 percent may be assessed for obligations arising
2 due to losses in any one contract year.
3 4. Any rate filing or portion of a rate filing
4 reflecting a rate change attributable entirely to the
5 assessment levied under this subparagraph shall be deemed
6 approved when made, subject to the authority of the Office of
7 Insurance Regulation Department of Insurance to require
8 actuarial justification as to the adequacy of any rate at any
9 time. If the rate filing reflects only a rate change
10 attributable to the assessment under this paragraph, the
11 filing may consist of a certification so stating.
12 5. The assessments otherwise payable to the
13 corporation pursuant to this paragraph subparagraph shall be
14 paid instead to the fund unless and until the Office of
15 Insurance Regulation and the Florida Surplus Lines Service
16 Office have Department of Insurance has received from the
17 corporation and the fund a notice, which shall be conclusive
18 and upon which they the Department of Insurance may rely
19 without further inquiry, that the corporation has issued bonds
20 and the fund has no agreements in effect with local
21 governments pursuant to paragraph (c) paragraph (b). On or
22 after the date of such notice and until such date as the
23 corporation has no bonds outstanding, the fund shall have no
24 right, title, or interest in or to the assessments, except as
25 provided in the fund's agreements with the corporation.
26 6. Emergency assessments are not premium and are not
27 subject to premium tax or surplus lines tax, fees, or
28 commissions; however, the failure by an assessable insured to
29 pay an emergency assessment shall be treated as a failure to
30 pay premium.
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1 (c)(b) Revenue bond issuance through counties or
2 municipalities.--
3 1. If the board elects to enter into agreements with
4 local governments for the issuance of revenue bonds for the
5 benefit of the fund, the board shall enter into such contracts
6 with one or more local governments, including agreements
7 providing for the pledge of revenues, as are necessary to
8 effect such issuance. The governing body of a county or
9 municipality is authorized to issue bonds as defined in s.
10 125.013 or s. 166.101 from time to time to fund an assistance
11 program, in conjunction with the Florida Hurricane Catastrophe
12 Fund, for the purposes set forth in this section or for the
13 purpose of paying the costs of construction, reconstruction,
14 repair, restoration, and other costs associated with damage to
15 properties of policyholders of covered policies due to the
16 occurrence of a hurricane by assuring that policyholders
17 located in this state are able to recover claims under
18 property insurance policies after a covered event.
19 2. In order to avoid needless and indiscriminate
20 proliferation, duplication, and fragmentation of such
21 assistance programs, any local government may provide for the
22 payment of fund reimbursements, regardless of whether or not
23 the losses for which reimbursement is made occurred within or
24 outside of the territorial jurisdiction of the local
25 government.
26 3. The state hereby covenants with holders of bonds
27 issued under this paragraph that the state will not repeal or
28 abrogate the power of the board to direct the Office of
29 Insurance Regulation Department of Insurance to levy the
30 assessments and to collect the proceeds of the revenues
31 pledged to the payment of such bonds as long as any such bonds
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1 remain outstanding unless adequate provision has been made for
2 the payment of such bonds pursuant to the documents
3 authorizing the issuance of such bonds.
4 4. There shall be no liability on the part of, and no
5 cause of action shall arise against any members or employees
6 of the governing body of a local government for any actions
7 taken by them in the performance of their duties under this
8 paragraph.
9 (d)(c) Florida Hurricane Catastrophe Fund Finance
10 Corporation.--
11 1. In addition to the findings and declarations in
12 subsection (1), the Legislature also finds and declares that:
13 a. The public benefits corporation created under this
14 paragraph will provide a mechanism necessary for the
15 cost-effective and efficient issuance of bonds. This mechanism
16 will eliminate unnecessary costs in the bond issuance process,
17 thereby increasing the amounts available to pay reimbursement
18 for losses to property sustained as a result of hurricane
19 damage.
20 b. The purpose of such bonds is to fund reimbursements
21 through the Florida Hurricane Catastrophe Fund to pay for the
22 costs of construction, reconstruction, repair, restoration,
23 and other costs associated with damage to properties of
24 policyholders of covered policies due to the occurrence of a
25 hurricane.
26 c. The efficacy of the financing mechanism will be
27 enhanced by the corporation's ownership of the assessments, by
28 the insulation of the assessments from possible bankruptcy
29 proceedings, and by covenants of the state with the
30 corporation's bondholders.
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1 2.a. There is created a public benefits corporation,
2 which is an instrumentality of the state, to be known as the
3 Florida Hurricane Catastrophe Fund Finance Corporation.
4 b. The corporation shall operate under a five-member
5 board of directors consisting of the Governor or a designee,
6 the Comptroller or a designee, the Treasurer or a designee,
7 the director of the Division of Bond Finance of the State
8 Board of Administration, and the chief operating officer of
9 the Florida Hurricane Catastrophe Fund.
10 c. The corporation has all of the powers of
11 corporations under chapter 607 and under chapter 617, subject
12 only to the provisions of this subsection.
13 d. The corporation may issue bonds and engage in such
14 other financial transactions as are necessary to provide
15 sufficient funds to achieve the purposes of this section.
16 e. The corporation may invest in any of the
17 investments authorized under s. 215.47.
18 f. There shall be no liability on the part of, and no
19 cause of action shall arise against, any board members or
20 employees of the corporation for any actions taken by them in
21 the performance of their duties under this paragraph.
22 3.a. In actions under chapter 75 to validate any bonds
23 issued by the corporation, the notice required by s. 75.06
24 shall be published only in Leon County and in two newspapers
25 of general circulation in the state, and the complaint and
26 order of the court shall be served only on the State Attorney
27 of the Second Judicial Circuit.
28 b. The state hereby covenants with holders of bonds of
29 the corporation that the state will not repeal or abrogate the
30 power of the board to direct the Office of Insurance
31 Regulation Department of Insurance to levy the assessments and
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1 to collect the proceeds of the revenues pledged to the payment
2 of such bonds as long as any such bonds remain outstanding
3 unless adequate provision has been made for the payment of
4 such bonds pursuant to the documents authorizing the issuance
5 of such bonds.
6 4. The bonds of the corporation are not a debt of the
7 state or of any political subdivision, and neither the state
8 nor any political subdivision is liable on such bonds. The
9 corporation does not have the power to pledge the credit, the
10 revenues, or the taxing power of the state or of any political
11 subdivision. The credit, revenues, or taxing power of the
12 state or of any political subdivision shall not be deemed to
13 be pledged to the payment of any bonds of the corporation.
14 5.a. The property, revenues, and other assets of the
15 corporation; the transactions and operations of the
16 corporation and the income from such transactions and
17 operations; and all bonds issued under this paragraph and
18 interest on such bonds are exempt from taxation by the state
19 and any political subdivision, including the intangibles tax
20 under chapter 199 and the income tax under chapter 220. This
21 exemption does not apply to any tax imposed by chapter 220 on
22 interest, income, or profits on debt obligations owned by
23 corporations other than the Florida Hurricane Catastrophe Fund
24 Finance Corporation.
25 b. All bonds of the corporation shall be and
26 constitute legal investments without limitation for all public
27 bodies of this state; for all banks, trust companies, savings
28 banks, savings associations, savings and loan associations,
29 and investment companies; for all administrators, executors,
30 trustees, and other fiduciaries; for all insurance companies
31 and associations and other persons carrying on an insurance
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1 business; and for all other persons who are now or may
2 hereafter be authorized to invest in bonds or other
3 obligations of the state and shall be and constitute eligible
4 securities to be deposited as collateral for the security of
5 any state, county, municipal, or other public funds. This
6 sub-subparagraph shall be considered as additional and
7 supplemental authority and shall not be limited without
8 specific reference to this sub-subparagraph.
9 6. The corporation and its corporate existence shall
10 continue until terminated by law; however, no such law shall
11 take effect as long as the corporation has bonds outstanding
12 unless adequate provision has been made for the payment of
13 such bonds pursuant to the documents authorizing the issuance
14 of such bonds. Upon termination of the existence of the
15 corporation, all of its rights and properties in excess of its
16 obligations shall pass to and be vested in the state.
17 (e)(d) Protection of bondholders.--
18 1. As long as the corporation has any bonds
19 outstanding, neither the fund nor the corporation shall have
20 the authority to file a voluntary petition under chapter 9 of
21 the federal Bankruptcy Code or such corresponding chapter or
22 sections as may be in effect, from time to time, and neither
23 any public officer nor any organization, entity, or other
24 person shall authorize the fund or the corporation to be or
25 become a debtor under chapter 9 of the federal Bankruptcy Code
26 or such corresponding chapter or sections as may be in effect,
27 from time to time, during any such period.
28 2. The state hereby covenants with holders of bonds of
29 the corporation that the state will not limit or alter the
30 denial of authority under this paragraph or the rights under
31 this section vested in the fund or the corporation to fulfill
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1 the terms of any agreements made with such bondholders or in
2 any way impair the rights and remedies of such bondholders as
3 long as any such bonds remain outstanding unless adequate
4 provision has been made for the payment of such bonds pursuant
5 to the documents authorizing the issuance of such bonds.
6 3. Notwithstanding any other provision of law, any
7 pledge of or other security interest in revenue, money,
8 accounts, contract rights, general intangibles, or other
9 personal property made or created by the fund or the
10 corporation shall be valid, binding, and perfected from the
11 time such pledge is made or other security interest attaches
12 without any physical delivery of the collateral or further act
13 and the lien of any such pledge or other security interest
14 shall be valid, binding, and perfected against all parties
15 having claims of any kind in tort, contract, or otherwise
16 against the fund or the corporation irrespective of whether or
17 not such parties have notice of such claims. No instrument by
18 which such a pledge or security interest is created nor any
19 financing statement need be recorded or filed.
20 (7) ADDITIONAL POWERS AND DUTIES.--
21 (a) The board may procure reinsurance from reinsurers
22 acceptable to the Office of Insurance Regulation approved
23 under s. 624.610 for the purpose of maximizing the capacity of
24 the fund.
25 (c) Each fiscal year, the Legislature shall
26 appropriate from the investment income of the Florida
27 Hurricane Catastrophe Fund an amount no less than $10 million
28 and no more than 35 percent of the investment income, based on
29 the most recent fiscal year-end audited financial statements,
30 from the prior fiscal year for the purpose of providing
31 funding for local governments, state agencies, public and
18
CODING: Words stricken are deletions; words underlined are additions.
Florida Senate - 2003 SB 2556
24-1370A-03
1 private educational institutions, and nonprofit organizations
2 to support programs intended to improve hurricane
3 preparedness, reduce potential losses in the event of a
4 hurricane, provide research into means to reduce such losses,
5 educate or inform the public as to means to reduce hurricane
6 losses, assist the public in determining the appropriateness
7 of particular upgrades to structures or in the financing of
8 such upgrades, or protect local infrastructure from potential
9 damage from a hurricane. Moneys shall first be available for
10 appropriation under this paragraph in fiscal year 1997-1998.
11 Moneys in excess of the $10 million specified in this
12 paragraph shall not be available for appropriation under this
13 paragraph if the State Board of Administration finds that an
14 appropriation of investment income from the fund would
15 jeopardize the actuarial soundness of the fund.
16 Section 2. This act shall take effect upon becoming a
17 law.
18
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20 SENATE SUMMARY
21 Revises provisions relating to the Florida Hurricane
Catastrophe Fund. Revises definitions to conform.
22 Provides for emergency assessments to be levied against
insureds procuring certain types of insurance. (See bills
23 for details.)
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25
26
27
28
29
30
31
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CODING: Words stricken are deletions; words underlined are additions.